The moderating effect of power distance on perceived interdependence and relationship quality in commercial banking : A cross‐cultural comparison

Purpose – The purpose of this cross‐cultural study is to examine the moderating effect of power distance on perceived interdependence and relationship quality in a bank‐corporate client relationship. Design/methodology/approach – Data were collected through surveys administered to bank customers in India and Canada. Confirmatory Factor Analysis and Multiple Regression were employed to assess the relationships among model variables. Findings – Results indicate that Power distance moderates the Interdependence and Relationship Quality Relationships. Research limitations/implications – This research was limited to only Indian and Canadian customers and their banks. Only one dimension of culture was used as a moderator of the Interdependence and Relationship Quality relationship. The study is limited to a single dimension of service banking. Practical implications – Buyer‐seller relationships are dependent on the specific cultural basis of the parties. Managers must be cognizant of the cultural values of the buyer/client in order to understand the most effective means of establishing and nurturing the buyer‐seller relationship. Originality/value – Given that Values, Interdependence, Interdependence Asymmetry, Trust and Commitment are critically important to the development of effective relationships, statistical data are presented supporting the fact that an element of national culture (Power Distance) moderates the degree of interdependence and the strength of the trust‐commitment linkage. To date, these relationships have not been explored in an eastern cultural context.