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- Title
Do Detail and Its Verifiability Serve as Indicators of Strategy Effectiveness and as Sources of Credibility in Voluntary Qualitative Disclosure?
- Authors
Cannon, James N.; Denison, Christine A.; Watanabe, Olena V.
- Abstract
This article examines whether detail and its verifiability serve as indicators of strategy effectiveness and provide sources of credibility in voluntary qualitative disclosure. In an archival study, utilizing a difference-in-difference research design, we find that firms that introduce customer retention strategy disclosures with verifiable detail are more effective at retaining customers than are firms that introduce disclosures with nonverifiable detail. In contrast, we find no significant difference between the performance of firms that initiate disclosures with verifiable detail and that of firms that initiate disclosures with no detail. In an experimental study, we find that customer retention strategy disclosures that include either verifiable or nonverifiable detail are perceived to be more credible than disclosures that provide no detail. In combination, we infer it is the verifiability of detail that predicts strategy effectiveness consistent with the disclosure, despite detail invoking perceived credibility in such disclosure.
- Subjects
CUSTOMER retention; ORGANIZATIONAL performance; EXPERIMENTAL design
- Publication
Journal of Accounting, Auditing & Finance, 2021, Vol 36, Issue 3, p557
- ISSN
0148-558X
- Publication type
Article
- DOI
10.1177/0148558X19885554