An empirical investigation of an incentive

plan that includes nonfinancial performance

measures
(Banker, Potter & Srinivasan, 2000)
DISCUSSION

Fernando Siahaan 10599584

Ada Sneekes 5928257
Roy Stift 5870984
Joris Tanke 5947448

Proposition 1
The conclusion that customer
satisfaction is related to future
economic benefits is not well justified

Proposition 1
The conclusion that customer
satisfaction is related to future
economic benefits is not well justified
Pros

Just one question

Focus on short-term effects
Higher service -> higher costs = no higher profit
No lower focus on financial measures
Increased bonus payments

Cons
Significant results on higher revs, higher prof. P/r, lower costs.
Customer loyalty, repeated business.

Proposition 2
The research method is too limited to
answer the research question

Proposition 2
The research method is too limited to
answer the research question
Pros

RQs are general, methods hotel specific, not to be generalized.

Different types of visitors (Business vs. Tourists)
Just 18 hotels, one chain
Measure short term effect of customer satisfaction on financial
performance

Cons
Hotels are spread over US
Correction for geographical factors
Customer satisfaction important for all types of industry.