Customer churn prediction in the banking industry

Internship Report presented as the partial requirement for obtaining a Master's degree in Data Science and Advanced Analytics, specialization in Business AnalyticsThe objective of this project is to create a predictive model that will decrease customer churn in a Portuguese bank. That is, we intend to identify customers who could be considering closing their checking accounts. For the bank to be able to take the necessary corrective measures, the model also aims to determine the characteristics of the customers that decided to leave. This model will make use of customer data that the organization already has to hand. Data pre-processing with data cleansing, transformation, and reduction was the initial stage of the analysis. The dataset is imbalanced, meaning that we have a small number of positive outcomes or churners; thus, under-sampling and other approaches were employed to address this issue. The predictive models used are logistic regression, support vector machine, decision trees and artificial neural networks, and for each, parameter tuning was also conducted. In conclusion, regarding the customer churn prediction, the recommended model is a support vector machine with a precision of 0.84 and an AUROC of 0.905. These findings will contribute to the customer lifetime value, helping the bank better understand their customers' behavior and allow them to draw strategies accordingly with the information obtained

The antecedents and consequences of salesperson deviance: A question of fit

The linkages between salesperson-organization fit and salesperson deviance behaviors have not received adequate attention in the marketing literature. Salespeople can be viewed as either a tremendous asset for the realization of an organization\u27s long term goals or as a potential threat to its overall success. This research addresses the importance of managing salesperson-organization fit in mitigating subsequent anti-normative behaviors. The study employs a conceptual model of sales-specific organizational congruence factors (work/nonwork demands fit, compensation structure fit, and values congruence) which drive salesperson deviance behaviors. The study examines how deviant behaviors are employed as a coping mechanism by salespeople who do not \u27fit\u27 within an organization. These behaviors influence salesperson competence through individual and organizational outcomes (performance, organizational commitment, turnover intentions and life satisfaction). The empirical tests of the hypotheses are based upon online survey data collected from 408 non-retail industrial salespeople from multiple companies in various industries

The Effects of Attrition on the Growth and Equity of Competitive Services

The growth of a new service is similar to a leaking bucket: There is an influx of new customers and, concurrently, an outflow of customers who either switch to competitors or leave the category. This attrition is a major concern for service providers and significantly affects long-range profits. In this study, the authors investigate the influence of attrition on the growth of service markets. They develop a model of a multifirm growing market, where a firm may acquire customers from the pool of nonusers (which can include new customers as well as customers who disadopted the category in the past) and also acquire customers who switched from competitors. Alternatively, the firm may lose customers who switch or “churn” to a competitor or leave the category entirely. By capturing the complex dynamics of customer acquisition and retention, this model enables an in-depth analysis of the growth of services. The authors use the model to explore the influence of attrition on the service category and on a particular brand. For service categories, they show that ignoring attrition biases the diffusion parameters and hence affects management diagnostics. For the individual brand, they present a brand-level growth model and use it to capture the effect of attrition on the firm’s customer equity: they calculate the customer equity of a growing service and evaluate service firms that operate in competitive industries, including Amazon.com, Barnes&Noble.com, E*Trade, Mobistar, and SK Telecom. For four of the five firms, the results are close to the stock market valuations, which may indicate the role of customer equity in the valuation of growing service firms. The services growth model adds to the customer equity approach not only by explicitly incorporating customer attrition into market growth, but also by allowing for inter-firm churn dynamics to be included in the estimation. Hence, it is especially well suited to dealing with cases where interfirm customer churn is an integral part of the growth process

Gainsharing and Mutual Monitoring: A Combined Agency-Procedural Justice Interpretation

This study examines the behavioral consequences of gainsharing using a combined theoretical framework that includes elements of agency and procedural justice theory. The hypothesis tested is that gainsharing as a collective form of incentive alignment results in increased mutual monitoring among agents (employees) when the plan is perceived to be procedurally fair. The hypothesis was supported in two separate firms using a quasi-experimental field study. The implications of the study for future extensions of agency theory to examine intraorganizational phenomena are discussed

Variability Within Organizations: Implications for Strategic Human Resource Management

[Excerpt] Strategic human resource management refers to the pattern of planned human resource deployments and activities intended to enable an organization to achieve its goals (Wright & McMahan, 1992). It involves all of the activities that are implemented by an organization to affect the behavior of individuals in an effort to implement the strategic needs of a business. Over the last decade or so, the field of strategic human resource management has witnessed a progression through a number of stages, including a) initial excitement and energy around the convincing argument that HR practices should be considered as a system that, when implemented appropriately, can enhance organizational performance; b) empirical tests of this argument, and c) critiques of the growing field accompanied by propositions for how thinking on the topic can be expanded and improved. Of the critiques that have been levied at the field, the most common contend that the “black box” through which HRM practices are thought to impact organizational performance remains insufficiently specified. Less common, but no less valuable, are critiques surrounding the conceptualization and measurement of fit or alignment, and the need to identify the boundary conditions that influence the effectiveness of “high performance” HRM systems. Even more critiques and proposed theoretical extensions to the field are likely, as it is through such endeavors that we will improve upon and advance our science (cf. Reichers & Schneider, 1990). In this chapter, we introduce and discuss another potential critique of the SHRM field, and, in so doing, hope to illuminate a number of important research questions for the future. In particular, we are concerned with the lack of attention which has been paid to variability within SHRM research. By variability we mean variability at all relevant levels of analysis, but particularly variability within organizations (i.e., individual and group levels). It is our contention that by failing to examine the potential role of variability in SHRM research, we miss a very interesting and important part of the picture

Research trends in customer churn prediction: A data mining approach

This study aims to present a very recent literature review on customer churn prediction based on 40 relevant articles published between 2010 and June 2020. For searching the literature, the 40 most relevant articles according to Google Scholar ranking were selected and collected. Then, each of the articles were scrutinized according to six main dimensions: Reference; Areas of Research; Main Goal; Dataset; Techniques; outcomes. The research has proven that the most widely used data mining techniques are decision tree (DT), support vector machines (SVM) and Logistic Regression (LR). The process combined with the massive data accumulation in the telecom industry and the increasingly mature data mining technology motivates the development and application of customer churn model to predict the customer behavior. Therefore, the telecom company can effectively predict the churn of customers, and then avoid customer churn by taking measures such as reducing monthly fixed fees. The present literature review offers recent insights on customer churn prediction scientific literature, revealing research gaps, providing evidences on current trends and helping to understand how to develop accurate and efficient Marketing strategies. The most important finding is that artificial intelligence techniques are are obviously becoming more used in recent years for telecom customer churn prediction. Especially, artificial NN are outstandingly recognized as a competent prediction method. This is a relevant topic for journals related to other social sciences, such as Banking, and also telecom data make up an outstanding source for developing novel prediction modeling techniques. Thus, this study can lead to recommendations for future customer churn prediction improvement, in addition to providing an overview of current research trends.info:eu-repo/semantics/acceptedVersio

Environmental, operational and financial sustainability of packaging methods in delivery businesses

Thesis (M. Eng. in Logistics)--Massachusetts Institute of Technology, Engineering Systems Division, 2010.Cataloged from PDF version of thesis.Includes bibliographical references (p. 143-148).In retail delivery companies, packaging is used to transport goods to customers while preventing damage, shrinkage and loss of the contents. With consumer preferences reflecting the growing concern for the environment, retail delivery businesses are at the crossroads of implementing a sustainable operational and financial business model of delivering packages to customers. In this thesis, we will address the issue of sustainable packaging in retail delivery companies by evaluating the financial, environmental and operational viability of such strategies. The thesis will be limited to the downstream order fulfillment cycle from the retail delivery company to the customer. We will focus on three areas applicable to sustainable packaging. The first area is materials innovation where we will analyze alternative materials suitable for retail delivery packaging. The second area involves waste elimination through reducing packaging material use and reusing of packaging materials through a returnable tote program. Lastly, we will understand the implementation challenges to increase the success rate of the strategies mentioned earlier.by Joshua Ng and Kendall Chow.M.Eng.in Logistic

Does Managerial Training have any impact on the performance of MSE Managers? Empirical evidence from Ghana

Received the best full paper award in the performance management trackAdopting the human capital theory as a lens, this study investigates the impact of managerial training on the performance of the managers of Micro and Small Enterprises (MSEs) in Ghana. The study uses primary data collected from 506 MSEs who are clients of Financial Non- Governmental Organisations (FNGOs) in the Volta Region of Ghana. Managerial Training (MT) and Performance has been measured on a five-point Likert scale anchored by strongly disagree (1) and strongly agree (5). MT has been measured using 4 main constructs namely, training content, training efficiency, training frequency and training accessibility whilst performance was measured using 12 items. The study controlled for business age, industry category, manager’s educational level and gender. The study shows that managerial training content, efficiency, frequency, and accessibility are statistically significant in explaining performance among MSE managers in Ghana. Secondly, the study also shows that industry category, managers educational level, and business age influences the performance of managers. However, gender is statistically insignificant and does not have any impact on the performance of MSE managers in Ghana. The study, therefore, argues for the delivery of managerial training which is content-rich, efficient, frequent and accessible to MSE managers to develop their managerial capabilities (Fatoki, 2011; Newman et al., 2014)

The strategic impact of technology based CRM on call centers' performance

The primary objective of this paper is to test a model that can explain the impact of technology based CRM on inbound call center performance. To do this, data were collected from 168 call center managers and analyzed through structural equation modeling. The research findings indicate that technology based CRM significantly affects first call resolution and perceived service quality, but weakly influence caller satisfactions through the mediating role of first call resolutions.Observably, this research believes that customer contact centers as the first touch points to company are dependent on other factors such as company policy, product quality, customer characteristics, etc. to influence caller satisfactions, but unfortunately most of these factors fall outside the operational control of contact center activities. The findings in this research has empirically provided the long waiting evidence that technology based CRM applications within the inbound contact center industry can only influence caller satisfactions through first call resolution and perceived service quality. A major implication for call center managers is that this research findings has availed them the opportunity on how to effectively develop, implement, and evaluate their CRM applications