Product/service adoption strategies and bank customer accounting in Hong Kong

The purpose of this research is to investigate the joint influence of early product adoption and bank customer accounting in Hong Kong.

In‐depth interviews at three Hong Kong banks provided the basis for designing a survey instrument, which was used to collect data from 35 local and overseas banks. Performance data were collected from the financial statements published by the banks

Findings revealed significant interactive influences of early product adoption and customer accounting practices on bank performance. That is, performance would be enhanced if customer accounting practices were used to a greater extent in those banks that were early in adopting a greater range of products. The evidence shows that bank performance in an intensely competitive market such as Hong Kong is driven by the fit between customer accounting practices and early product adoption strategies.

This paper is subject to small sample size and the use of a cross‐sectional sample setting.

The evidence that is provided in this study adds to the understanding of the relationship between management accounting and organisational strategy. The topic is of interest given the recent deregulation of the banking industry in Hong Kong and the expansion of products that have been offered by banks during the last five years.