Journal Screenshot

International Journal of Academic Research in Accounting, Finance and Management Sciences

Open Access Journal

ISSN: 2225-8329

Examining the Relationship between Service Innovation and Competitive Advantage: Does Brand Recognition Matter?

George Dominic Kofi Mante, Umar Haiyat Abdul Kohar

http://dx.doi.org/10.6007/IJARAFMS/v14-i1/20638

Open access

Despite the wide contention that service innovation has diverse performance implications. The mechanisms and conditions under which service innovation drives competitive advantage is less understood. Drawing insights from the dynamic capability perspective and survey data from 400 senior managers of banks in Ghana, we found support for the argument that service innovation is important in the quest to improve competitive advantage. Our findings also suggest that brand awareness does not just support competitive advantage but serves transformative mechanism to reap superior competitive advantage in the service environment. Our findings make contemporary contribution to the DCT as well as important managerial guidance for managers in the banking space in resource constrained regions like Sub-Sahara Africa (SSA).

Abou-Moghli, A. A., Al Abdallah, G. M., & Al Muala, A. (2012). Impact of innovation on realizing competitive advantage in banking sector in Jordan. American Academic & Scholarly Research Journal, 4(5), 1.
Afaq, A., Gaur, L., & Singh, G. (2023). Social CRM: linking the dots of customer service and customer loyalty during COVID-19 in the hotel industry. International Journal of Contemporary Hospitality Management, 35(3), 992–1009.
Al-omoush, K. S., Khalid, M., & Attar, A. (2020). The drivers of E-banking entrepreneurship?: an empirical study. 38(2), 485–500. https://doi.org/10.1108/IJBM-03-2019-0113
Alvarado-Karste, D., & Guzmán, F. (2020). The effect of brand identity-cognitive style fit and social influence on consumer-based brand equity. Journal of Product & Brand Management, 29(7), 971–984.
Amoako-Gyampah, K., Boakye, K. G., Famiyeh, S., & Adaku, E. (2020). Supplier integration, operational capability and firm performance: an investigation in an emerging economy environment. Production Planning & Control, 31(13), 1128–1148.
Andotra, N., & Bhat, D. A. R. (2017). Understanding customer experiences in destination building: A demographic analysis of Kashmirtourism development corporation customers. Scholars World–International Refereed Multidisciplinary Journal of Contemporary Research, 5(4), 93–102.
Anning-Dorson, T. (2018). Innovation and competitive advantage creation: The role of organisational leadership in service firms from emerging markets. International Marketing Review, 35(4), 580–600. https://doi.org/10.1108/IMR-11-2015-0262
Anning-Dorson, T., & Nyamekye, M. B. (2020). Be flexible: turning innovativeness into competitive advantage in hospitality firms. International Journal of Contemporary Hospitality Management, 32(2), 605–624. https://doi.org/10.1108/IJCHM-12-2018-1014
Azeem, M., Ahmed, M., Haider, S., & Sajjad, M. (2021). Expanding competitive advantage through organizational culture, knowledge sharing and organizational innovation. Technology in Society, 66, 101635.
Azzari, V., & Pelissari, A. (2021). Does brand awareness influences purchase intention? The mediation role of brand equity dimensions. BBR. Brazilian Business Review, 17, 669–685.
Bahrami, M., & Shokouhyar, S. (2022). The role of big data analytics capabilities in bolstering supply chain resilience and firm performance: a dynamic capability view. Information Technology & People, 35(5), 1621–1651.
Barney, J. (1991). Firm Resources and Sustained Competitive Advantage. Journal of Management, 17(1), 99–120.
Baumgartner, H., & Weijters, B. (2012). Commentary on “common method bias in marketing: Causes, mechanisms, and procedural remedies.” Journal of Retailing, 88(4), 563–566.
Boinett, C. K., Kibet, Y., & Jemaiyo, B. (2022). Relationship between Brand Awareness and Competitive Advantage of Independent Petroleum Dealers in Uasin Gishu County , Kenya. 10(4), 27–39.
Busse, C., Schleper, M. C., & Wagner, S. M. (2018). Supplier development for sustainability?: contextual barriers in global supply chains. International Journal of Physical Distribution and Logistics Management, 1–39.
Bustinza, O. F., Gomes, E., Vendrell?Herrero, F., & Baines, T. (2019). Product–service innovation and performance: the role of collaborative partnerships and R&D intensity. R&d Management, 49(1), 33–45.
Chen, J.-S., Hung Tai Tsou, & Huang, A. Y.-H. (2009). Service Delivery Innovation. Journal of Service Research, 12(1), 36–55. https://doi.org/10.1177/1094670509338619
Chen, K. H., Wang, C. H., Huang, S. Z., & Shen, G. C. (2016). Service innovation and new product performance: The influence of market-linking capabilities and market turbulence. International Journal of Production Economics, 172, 54–64. https://doi.org/10.1016/j.ijpe.2015.11.004
Chen, L., Li, Y.-Q., & Liu, C.-H. (2019). How airline service quality determines the quantity of repurchase intention-Mediate and moderate effects of brand quality and perceived value. Journal of Air Transport Management, 75, 185–197.
Chiu, C.-N., & Yang, C.-L. (2019). Competitive advantage and simultaneous mutual influences between information technology adoption and service innovation: Moderating effects of environmental factors. Structural Change and Economic Dynamics, 49, 192–205.
Chong, D., & Ali, H. (2022). Literature Review: Competitive Strategy, Competitive Advantages, and Marketing Performance on E-Commerce Shopee Indonesia. Dinasti International Journal of Digital Business Management, 3(2), 299–309.
Clottey, T., & Benton Jr, W. C. (2013). Guidelines for improving the power values of statistical tests for nonresponse bias assessment in OM research. Decision Sciences, 44(4), 797–812.
Daosue, C., & Wanarat, S. (2019). The effects of advertising and sales promotion on brand awareness for a food product brand in wholesale shops, Bangkok and metropolitan areas. ABAC Journal, 39(1).
den Hertog, P., van der Aa, W., & de Jong, M. W. (2010). Capabilities for managing service innovation: Towards a conceptual framework. Journal of Service Management, 21(4), 490–514. https://doi.org/10.1108/09564231011066123
Dzogbewu, T. C., Fianko, S. K., Amoah, N., Afrifa, S., & de Beer, D. (2022). Additive manufacturing in South Africa: critical success factors. Heliyon.
Eisenhardt, K. M., & Martin, J. A. (2000). Dynamic capabilities: what are they? Strategic Management Journal, 21(10?11), 1105–1121.
Eloranta, V., & Turunen, T. (2015). Seeking competitive advantage with service infusion: A systematic literature review. Journal of Service Management, 26(3), 394–425. https://doi.org/10.1108/JOSM-12-2013-0359
Feng, C., Ma, R., & Jiang, L. (2020). The impact of service innovation on firm performance: a meta-analysis. Journal of Service Management, 16. https://doi.org/10.1108/JOSM-03-2019-0089
Ferreira, J., Coelho, A., & Moutinho, L. (2020). Dynamic capabilities, creativity and innovation capability and their impact on competitive advantage and firm performance: The moderating role of entrepreneurial orientation. Technovation, 92, 102061.
Greco, L. M., O’Boyle, E. H., & Walter, S. L. (2015). Absence of malice: A meta-analysis of nonresponse bias in counterproductive work behavior research. Journal of Applied Psychology, 100(1), 75.
Gyemang, M., & Emeagwali, O. (2020). The roles of dynamic capabilities, innovation, organizational agility and knowledge management on competitive performance in telecommunication industr. Management Science Letters, 10(7), 1533–1542.
Hair Jr, J. F., Sarstedt, M., Hopkins, L., & Kuppelwieser, V. G. (2014). Partial least squares structural equation modeling (PLS-SEM): An emerging tool in business research. European Business Review.
Hameed, W. U., Nisar, Q. A., & Wu, H.-C. (2021). Relationships between external knowledge, internal innovation, firms’ open innovation performance, service innovation and business performance in the Pakistani hotel industry. International Journal of Hospitality Management, 92, 102745.
Hanif, M. I., & Asgher, M. U. (2018). Service innovation and service innovation performance: A study of Banking services. Pakistan Journal of Commerce and Social Science, 12(2), 670–694.
Harrigan, K. R., Di Guardo, M. C., & Cowgill, B. (2017). Multiplicative-innovation synergies: tests in technological acquisitions. The Journal of Technology Transfer, 42, 1212–1233.
Heinonen, K., & Strandvik, T. (2020). Reframing service innovation: COVID-19 as a catalyst for imposed service innovation. Journal of Service Management, 32(1), 101–112.
Hinson, R. E., Abdul-Hamid, I. K., & Osabutey, E. L. C. (2017). Investigating market orientation and positioning in star-rated hotels in Ghana. International Journal of Contemporary Hospitality Management, 29(10), 2629–2646.
Huang, Y.-C., & Liu, C.-H. (2020). Buffering effects of brand perception to behavioural intention-Evidence of China airlines. Research in Transportation Business & Management, 37, 100468.
Islam, M. M., Hossain, M. B., Akhtar, M. N., Moni, M. A., & Hasan, K. F. (2022). CNN based on transfer learning models using data augmentation and transformation for detection of concrete crack. Algorithms, 15(8), 287.
Kano, K., Choi, L. K., subhan Riza, B., & Octavyra, R. D. (2022). Implications of digital marketing strategy the competitive advantages of small businesses in indonesia. Startupreneur Business Digital (SABDA Journal), 1(1), 44–62.
Kasasbeh, E. (2017). Factors Influencing Competitive Advantage in Banking Sector?: A Systematic Literature Review. March. https://doi.org/10.3923/rjbm.2017.67.73
Kaur, K., & Kumar, P. (2020). Social media usage in Indian beauty and wellness industry: a qualitative study. The TQM Journal, 33(1), 17–32.
Keiningham, T., Aksoy, L., Bruce, H. L., Cadet, F., Clennell, N., Hodgkinson, I. R., & Kearney, T. (2020). Customer experience driven business model innovation. Journal of Business Research, 116, 431–440.
Keller, K. L. (2009). Building strong brands in a modern marketing communications environment. Journal of Marketing Communications, 15(2–3), 139–155. https://doi.org/10.1080/13527260902757530
Khan, A., & Tao, M. (2022). Knowledge absorption capacity’s efficacy to enhance innovation performance through big data analytics and digital platform capability. Journal of Innovation & Knowledge, 7(3), 100201.
Kiani, B., Shirouyehzad, H., Bafti, F. K., & Fouladgar, H. (2009). System dynamics approach to analysing the cost factors effects on cost of quality. International Journal of Quality & Reliability Management, 26(7), 685–698.
Kwateng, K. O., & Osei-wusu, E. E. (2020). Exploring the effect of online banking on bank performance using data envelopment analysis. 27(1), 137–165.
https://doi.org/10.1108/BIJ-06-2018-0154
Lay Hong, T., Cheong, B. C., & Rizal, S. H. (2016). Service Innovation in Malaysian Banking Industry towards Sustainable Competitive Advantage through Environmentally and Socially Practices. Procedia - Social and Behavioral Sciences, 224(August 2015), 52–59. https://doi.org/10.1016/j.sbspro.2016.05.399
Lee, K., & Yoo, J. (2019). How does open innovation lead competitive advantage? A dynamic capability view perspective. PloS One, 14(11), e0223405.
Lee, S. M., & Lee, D. (2020). “Untact”: a new customer service strategy in the digital age. Service Business, 14(1), 1–22.
Lestari, S. D., Leon, F. M., Widyastuti, S., Brabo, N. A., & Putra, A. H. P. K. (2020). Antecedents and consequences of innovation and business strategy on performance and competitive advantage of SMEs. The Journal of Asian Finance, Economics and Business, 7(6), 365–378.
Liat, C. B., Mansori, S., Chuan, G. C., & Imrie, B. C. (2017). Hotel service recovery and service quality: Influences of corporate image and generational differences in the relationship between customer satisfaction and loyalty. Journal of Global Marketing, 30(1), 42–51.
MacKenzie, S. B., & Podsakoff, P. M. (2012). Common method bias in marketing: Causes, mechanisms, and procedural remedies. Journal of Retailing, 88(4), 542–555.
Mahmoud, M. A., Hinson, R. E., & Anim, P. A. (2018). Service innovation and customer satisfaction: the role of customer value creation. European Journal of Innovation Management, 21(3), 402–422. https://doi.org/10.1108/EJIM-09-2017-0117
Mainardes, E. W., Funchal, B., & Soares, J. (2017). The informatics technology and innovation in the service production. Structural Change and Economic Dynamics, 43, 27–38.
Mazurek, M. (2019). Brand reputation and its influence on consumers’ behavior. In Contemporary issues in behavioral finance (pp. 45–52). Emerald Publishing Limited.
Meigounpoory, M. R., Rezvani, M., & Afshar, M. (2015). Identification of Service Innovation Dimensions in Service Organizations. International Journal of Management, Accounting & Economics, 2(7), 737–748.
https://liverpool.idm.oclc.org/login?url=http://search.ebscohost.com/login.aspx?direct=true&db=bth&AN=110456883&site=eds-live&scope=site
M?otkowska, K., & Kowalik, I. (2023). Mazovia brand awareness among corporate customers: implications for local authorities. Central European Management Journal, 31(1), 130–145.
Muneeb, D., Khattak, A., Wahba, K., Abdalla, S., & Ahmad, S. Z. (2023). Dynamic capabilities as a strategic flexibility enabler: organizational responsiveness to COVID-19. Journal of Asia Business Studies, 17(4), 824–849.
Navneet Bhatnagar& Arun Kumar Gopalaswamy. (2017). The role of a firm ’ s innovation competence on customer adoption of service innovation. https://doi.org/10.1108/MRR-11-2015-0280
Noorlitaria, G., Pangestu, F. R., Fitriansyah, U. S., & Mahsyar, S. (2020). How does brand awareness affect purchase intention in mediation by perceived quality and brand loyalty. Journal of Critical Reviews, 7(2), 103–109.
Nyadera, I. N., Agwanda, B., Onder, M., & Mukhtar, I. A. (2022). Multilateralism, developmental regionalism, and the African Development Bank. Politics and Governance, 10(2), 82–94.
Osborne, S. P. (2020). Public service logic: Creating value for public service users, citizens, and society through public service delivery. Routledge.
Pizzi, G., & Scarpi, D. (2019). The year of establishment effect on brand heritage and attitudes. Journal of Consumer Marketing, 36(6), 827–834.
Podsakoff, P. M., MacKenzie, S. B., & Podsakoff, N. P. (2012). Sources of method bias in social science research and recommendations on how to control it. Annual Review of Psychology, 63, 539–569.
Prajogo, D. I., & Oke, A. (2016). Human capital, service innovation advantage, and business performance: The moderating roles of dynamic and competitive environments. International Journal of Operations and Production Management, 36(9), 974–994. https://doi.org/10.1108/IJOPM-11-2014-0537
Rachmawati, E., & Suroso, A. (2020). A moderating role of halal brand awareness to purchase decision making. Journal of Islamic Marketing, 13(2), 542–563.
Razak, M., Hidayat, M., Launtu, A., Kusuma Putra, A. H. P. A. H. P., & Bahasoan, S. (2020). Antecedents and consequence of brand management: empirical study of Apple’s brand product. Journal of Asia Business Studies, 14(3), 307–322.
Rehman, S. U., Bresciani, S., Ashfaq, K., & Alam, G. M. (2022). Intellectual capital, knowledge management and competitive advantage: a resource orchestration perspective. Journal of Knowledge Management, 26(7), 1705–1731.
Reio Jr, T. G. (2010). The threat of common method variance bias to theory building. Human Resource Development Review, 9(4), 405–411.
Sabahi, S., & Parast, M. M. (2020). Firm innovation and supply chain resilience: a dynamic capability perspective. International Journal of Logistics Research and Applications, 23(3), 254–269.
Salunke, S., Weerawardena, J., & Mccoll-kennedy, J. R. (2019). The central role of knowledge integration capability in service innovation- based competitive strategy. Industrial Marketing Management, 76(July 2018), 144–156.
https://doi.org/10.1016/j.indmarman.2018.07.004
Schilke, O. (2014). On the contingent value of dynamic capabilities for competitive advantage: The nonlinear moderating effect of environmental dynamism. Strategic Management Journal, 35(2), 179–203.
Sharma, D. V., & Bhat, D. A. R. (2020). An empirical study exploring the relationship among human capital innovation, service innovation, competitive advantage and employee productivity in hospitality services. Service Innovation, Competitive Advantage and Employee Productivity In Hospitality Services (June 30, 2020).
Sharma, V., & Bhat, D. A. R. (2019). Empirical assessment of the role of human capital innovation in service innovation implementation in the hospitality industry. Researcher: A Multidisciplinary Journal, 15(1), 65–77.
Shujaat, S., Shah, A., & Khan, Z. (2020). Corporate social responsibility?: a pathway to sustainable competitive advantage?? 38(1), 159–174. https://doi.org/10.1108/IJBM-01-2019-0037
Si, S., Chen, H., Liu, W., & Yan, Y. (2019). Disruptive innovation , business model and sharing economy?: the bike-sharing cases in China. https://doi.org/10.1108/MD-06-2019-0818
Srivastava, V., Kishore, S., & Dhingra, D. (2021). Technology and the Future of Customer Experience. In S. Popli & B. Rishi (Eds.), Crafting Customer Experience Strategy (pp. 91–116). Emerald Publishing Limited. https://doi.org/10.1108/978-1-83909-710-220211006
Tai, Y.-F., Wang, Y.-C., & Luo, C.-C. (2021). Technology-or human-related service innovation? Enhancing customer satisfaction, delight, and loyalty in the hospitality industry. Service Business, 15, 667–694.
Teece, D. J. (2007). Explicating Dynamic Capabilities?: The Nature and Microfoundations of ( Sustainable ) Enterprise Performance. 1350(August), 1319–1350.
https://doi.org/10.1002/smj
Teece, D. J., Pisano, G., & Shuen, A. (1997). Dynamic capabilities and strategic management. Knowledge and Strategy, 18(March), 77–116.
https://doi.org/10.1093/0199248540.003.0013
Tehseen, S., Ramayah, T., & Sajilan, S. (2017). Testing and controlling for common method variance: A review of available methods. Journal of Management Sciences, 4(2), 142–168.
Tsai, M. C., & Wang, C. (2017). Linking service innovation to firm performance: The roles of ambidextrous innovation and market orientation capability. Chinese Management Studies, 11(4), 730–750. https://doi.org/10.1108/CMS-03-2017-0045
Tsou, H. T., & Chen, J. S. (2020). Dynamic capabilities, human capital and service innovation: the case of Taiwan ICT industry. Asian Journal of Technology Innovation, 28(2), 181–203. https://doi.org/10.1080/19761597.2020.1719852
Valjakka, T., Kansola, M., Hakanen, T., & Valkokari, K. (2013). Antecedents of value co-creation in b2b networks. The Philosopher’s Stone for Sustainability: Proceedings of the 4th CIRP International Conference on Industrial Product-Service Systems, Tokyo, Japan, November 8th-9th, 2012, 173–177.
Victorino, L., Verma, R., Plaschka, G., & Dev, C. (2005). Service innovation and customer choices in the hospitality industry. Managing Service Quality: An International Journal, 15(6), 555–576.
Wagner, D., Wenzel, M., Wagner, H.-T., & Koch, J. (2017). Sense, seize, reconfigure: online communities as strategic assets. Journal of Business Strategy.
Wang, C.-N., Day, J.-D., & Farid, M. (2019). Service innovation model of the automobile service industry. Applied Sciences, 9(12), 2403.
Wang, X., Yang, Z., Wang, X., & Yang, Z. (2010). The Effect of Brand Credibility on Consumers ’ Brand Purchase Intention in Emerging Economies?: The Moderating Role of Brand Awareness and Brand Image The Effect of Brand Credibility on Consumers ’ Brand Purchase Intention in Emerging Economies?: The Mode. 1762. https://doi.org/10.1080/08911762.2010.487419
Wilden, R., & Gudergan, S. (2017). Service-dominant orientation, dynamic capabilities and firm performance. Journal of Service Theory and Practice, 27(4), 808–832. https://doi.org/10.1108/JSTP-04-2016-0077
Woo, H., Kim, S. J., & Wang, H. (2021). Understanding the role of service innovation behavior on business customer performance and loyalty. Industrial Marketing Management, 93, 41–51.
Yang-Fei, T., Wang, Y.-C., & Ching-Ching, L. (2021). Technology-or human-related service innovation? Enhancing customer satisfaction, delight, and loyalty in the hospitality industry. Service Business, 15(4), 667–694.
Yee, R. W. Y., Yeung, A. C. L., & Cheng, T. C. E. (2010). Int . J . Production Economics An empirical study of employee loyalty , service quality and firm performance in the service industry. Intern. Journal of Production Economics, 124(1), 109–120. https://doi.org/10.1016/j.ijpe.2009.10.015
Yuan, B., & Cao, X. (2022). Do corporate social responsibility practices contribute to green innovation? The mediating role of green dynamic capability. Technology in Society, 68, 101868.
YuSheng, K., & Ibrahim, M. (2019). Service innovation, service delivery and customer satisfaction and loyalty in the banking sector of Ghana. International Journal of Bank Marketing, 37(5), 1215–1233. https://doi.org/10.1108/IJBM-06-2018-0142
Zhao, J., Butt, R. S., Murad, M., Mirza, F., & Saleh Al-Faryan, M. A. (2022). Untying the influence of advertisements on consumers buying behavior and brand loyalty through brand awareness: the moderating role of perceived quality. Frontiers in Psychology, 12, 803348.
Zia, A., Younus, S., Mirza, F., & Author, C. (2021). Investigating the Impact of Brand Image and Brand Loyalty on Brand Equity?: the Mediating Role of Brand Awareness. 15(2), 1091–1106.
Ziyae, B., & Sadeghi, H. (2021). Service innovation in the hotel industry?: the dynamic capabilities view. 2019. https://doi.org/10.1108/JEC-12-2020-0205

(Mante & Kohar, 2024)
Mante, G. D. K., & Kohar, U. H. A. (2024). Examining the Relationship between Service Innovation and Competitive Advantage: Does Brand Recognition Matter? International Journal of Academic Research in Accounting Finance and Management Sciences, 14(1), 183–205.