9th Global Conference on Business & Economics ISBN : 978-0-9742114-2-7 The Role of Marketing Information Systems in Responding to External Environmental Factors: An Empirical Study of the Jordanian Banking Industry Ghazi A. Al-Weshah University of Wales, Newport - Newport Business School E-mail: [email protected]Contact No: +44 (0) 7853134270 Ghazi A. Al-Weshah is final year-PhD student in marketing at the Newport Business School, South Wales, UK. He has MBA/marketing since 2002. He had worked as an instructor in business and marketing for 4 year Jordan and Saudi Arabia. Prior to academe he was working as a financial controller in banking industry Jonathan H. Deacon University of Wales, Newport - Newport Business School E-mail: [email protected]Contact No: +44 (0) 1633 43 23 22 Dr. Jonathan H Deacon is a Reader in Marketing and Entrepreneurship at the Newport Business School, he is a visiting academic at institutions in Spain, Germany and the USA and is Chair of the Chartered Institute of Marketing Wales – prior to academe he had success in business and broadcasting. October 16-17, 2009 Cambridge University, UK 1
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9th Global Conference on Business & Economics ISBN : 978-0-9742114-2-7
The Role of Marketing Information Systems in Responding to External Environmental Factors: An Empirical Study of the Jordanian Banking Industry
Ghazi A. Al-WeshahUniversity of Wales, Newport - Newport Business School
Ghazi A. Al-Weshah is final year-PhD student in marketing at the Newport Business School, South Wales, UK. He has MBA/marketing since 2002. He had worked as an instructor in business and marketing for 4 year Jordan and Saudi Arabia. Prior to academe he was working as a financial controller in banking industry
Jonathan H. DeaconUniversity of Wales, Newport - Newport Business School
Dr. Jonathan H Deacon is a Reader in Marketing and Entrepreneurship at the Newport Business School, he is a visiting academic at institutions in Spain, Germany and the USA and is Chair of the Chartered Institute of Marketing Wales – prior to academe he had success in business and broadcasting.
**Correlation is significant at the 0.01 level (2-tailed)
The closer the coefficient is to 1, the stronger the relationship. On the other hand, the closer
the coefficient is to zero, the weaker the relationship. As we notice from the table 3 above,
the Pearson correlation coefficient between marketing information system and adapting to
external environmental factors is (0.387). This value indicates to weak relationship between
the two variables. Moreover, the positive coefficient indicates to the positive direction of the
relationship between the two variables. Therefore, there is a weak positive relationship
between MKIS and adapting to external environmental factors in Jordanian banking industry.
The effect of MKIS on adapting to environmental factors
Correlation coefficient does not take into account which variable is considered to be
dependent variable and which the independent. One of the current study aims is to assess the
effect of MKIS as independent variable on adapting to external environmental factors as a
one of dependent variables. For that purpose, the linear regression model is used. As we
mentioned before, the linear regression can be expressed as: Y= B0 +BiXi where the value of
independent variable is Y is a linear function of the corresponding value of the independent
variable X. the slope (Bi), and the intercept (B0) .
Practically, the current study uses SPSS to estimate the following regression equation for the
two variables:
AEF= 1.859 + 0.559 MKIS …. (1)
Where:
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AEF= adapting (responding) to environmental factors (dependent variable)
MKIS= marketing information system (independent variable)
According to equation 1, the slope of line (0.559) indicates to the expected change in
adapting to external environmental factors when marketing information system in a bank is
changed by one unit. The intercept (1.859) is the estimation value of adapting to
environmental factors when there is no marketing information system in bank. In other
words, the value indicates to the adapting to environmental factors regardless of marketing
information system.
The strength of cause (MKIS) and effect (adapting to external environmental factors)
relationship
The Coefficient of determination (R2) measures the proportion of variation in a dependent
variable that can be explained statistically by the independent variable. In other words, (R2)
indicates to the proportion of changes in the dependent variable that is associated with
changes in the independent variable. Practically, the current study computed (R2) using SPSS
and it is (0.15). This percentage is the proportion of changes in the adapting to environmental
factors that is associated with changes in marketing information system. Therefore, this
percent (0.15) indicates to the relative contribution of marketing information system in
adapting to environmental factors in Jordanian banking industry
CONCLUSION AND STRATEGIC IMPLICATIONS
In the light of previous- mentioned statistical analysis of the study questionnaire, the findings
of the study can be summarised as follows:
There is a weak positive relationship between MKIS and responding to external
environmental factors in Jordanian banking industry. The Pearson correlation
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9th Global Conference on Business & Economics ISBN : 978-0-9742114-2-7
coefficient between the two variables is (0.387). The value indicated that responding
or adapting to external environment is not mainly associated with MKIS output.
The expected change in adapting to external environmental factors when marketing
information system in a bank is changed by one unit is (0.559). this value indicated
that any development in MKIS will lead to more ability to adapt to external
environment in low rate.
The proportion of changes in the responding to environmental factors that is
associated with changes in marketing information system is (0.15). Therefore,
statistically, there is (0.85) of variation (change) in responding to external
environmental factors can be explained by other factors other than MKIS.
In the light of the above-mentioned findings, the current study concludes that MKIS in
Jordanian banking industry is not effectively employed to analyse the expected change in
external environment up to date. However, the MKIS in Jordanian banking industry has
potentials in foreseeable future to create informational competitive advantage that support
responding to external environment.
Consequently, the study recommends that Jordanian banks encounter greater risks whenever
the environment changes. As a result, more coordination is needed to increase the capacity of
information processing. Organizations have to expand the scope of information that they deal
with in order to be receptive to environmental change and volatility. To cope successfully
with environmental volatility, managers need to increase their information-gathering
activities in an attempt to improve their decision making under uncertainty and variation.
Moreover, the information scope is expected to be different and focus more on what is
actually and regularly needed by banks.
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RECOMMENDATIONS FOR FURTHER RESEARCH
The current study was limited to the Jordanian Banks working inside Jordan. Therefore, the
study did not include the foreign Banks working inside Jordan or Jordanian banks outside
Jordan. This study employed cross-sectional design to collect the primary data at specific
time period. Moreover, it focused on the quantitative techniques to investigate the role of
MKIS in responding to external environmental factors in the Jordanian banking Industry. In
the light of these limitations, future research can consider the qualitative techniques of
collecting and analysing data to find out additional support for the findings of quantitative
data analysis and to identify the missing issues that are not discovered in the quantitative
approach. Longitudinal design can be employed in further research to compare the change of
MKIS effect on the environment over the years Moreover, the further studies can be
extended to other services and manufacturing industries.
Note: the current study is part of PhD research conducted at University of Wales, Newport.
UK.
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Appendix A: structure of Jordan banking system
Jordan Banking System
)End of 2008(
1 .National BanksYear of
establishment Number of
branches
Number of mini-
branches
Number of branches
outside Jordan
A. commercial Banks
Arab Bank PLC 1930 82 - 89
Jordan Ahli Bank PLC1956 42 4 6
Bank of Jordan PLC1960 44 30 7
Cairo Amman Bank 1960 36 16 16
The Housing Bank for Trade and Finance
1974 96 3 7
Jordan -Kuwait Bank 1977 34 12 1
Jordan Commercial Bank 1978 24 2 3
Arab Banking Corporation (Jordan)
1989 12 - -
Union Bank for saving and Investment
1991 12 2 1
B. Islamic Banks
Jordan Islamic Bank for Finances and Investment
1979 54 9 -
Islamic International Arab 1997 11 - -
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Bank PLC
Source: adapted from Central bank of Jordan, annual report, 2008