THE MEDIATING EFFECTS OF KEY PERFORMANCE ACHIEVEMENT IN SALE FORCE RETENTION IN MALAYSIAN COMMERCIAL BANKS

Abstract

Erosion of revenue due to intense competition has forced the banks to create a sales culture as a new transformation in the banking sector. Banks are now recruiting staff with selling skills and abilities to perform their selling activities, whose performance is measured by Key Performance Indicator (KPI). Due to the competitive nature of the banking market and high-performance culture, a highly competent sales force is accounted to deliver great sales service. This service quality serves as a differentiated strategy to capture the market and increase bank performance. The critical issue is the low retention rate of the sales force especially top sales force in the banks. This paper investigates the mediating role of KPI achievement on the relationship between leadership, teamwork, and high-performance culture with retention of the sales force. Using hierarchical regression analysis, responses from self-administered questionnaires obtained from the sales force of all Malaysian local commercial banks were analyzed. The results showed that KPI achievement fully mediated the relationship between high-performance culture, teamwork, and the banks’ sales force retention. This mediation effect indicates that the sales force perceives that having achieved their KPI is an important reason for them to remain in the same bank.