• Title/Summary/Keyword: Product Risk Management

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How Enduring Product Involvement and Perceived Risk Affect Consumers' Online Merchant Selection Process: The 'Required Trust Level' Perspective (지속적 관여도 및 인지된 위험이 소비자의 온라인 상인선택 프로세스에 미치는 영향에 관한 연구: 요구신뢰 수준 개념을 중심으로)

  • Hong, Il-Yoo B.;Lee, Jung-Min;Cho, Hwi-Hyung
    • Asia pacific journal of information systems
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    • v.22 no.1
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    • pp.29-52
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    • 2012
  • Consumers differ in the way they make a purchase. An audio mania would willingly make a bold, yet serious, decision to buy a top-of-the-line home theater system, while he is not interested in replacing his two-decade-old shabby car. On the contrary, an automobile enthusiast wouldn't mind spending forty thousand dollars to buy a new Jaguar convertible, yet cares little about his junky component system. It is product involvement that helps us explain such differences among individuals in the purchase style. Product involvement refers to the extent to which a product is perceived to be important to a consumer (Zaichkowsky, 2001). Product involvement is an important factor that strongly influences consumer's purchase decision-making process, and thus has been of prime interest to consumer behavior researchers. Furthermore, researchers found that involvement is closely related to perceived risk (Dholakia, 2001). While abundant research exists addressing how product involvement relates to overall perceived risk, little attention has been paid to the relationship between involvement and different types of perceived risk in an electronic commerce setting. Given that perceived risk can be a substantial barrier to the online purchase (Jarvenpaa, 2000), research addressing such an issue will offer useful implications on what specific types of perceived risk an online firm should focus on mitigating if it is to increase sales to a fullest potential. Meanwhile, past research has focused on such consumer responses as information search and dissemination as a consequence of involvement, neglecting other behavioral responses like online merchant selection. For one example, will a consumer seriously considering the purchase of a pricey Guzzi bag perceive a great degree of risk associated with online buying and therefore choose to buy it from a digital storefront rather than from an online marketplace to mitigate risk? Will a consumer require greater trust on the part of the online merchant when the perceived risk of online buying is rather high? We intend to find answers to these research questions through an empirical study. This paper explores the impact of enduring product involvement and perceived risks on required trust level, and further on online merchant choice. For the purpose of the research, five types or components of perceived risk are taken into consideration, including financial, performance, delivery, psychological, and social risks. A research model has been built around the constructs under consideration, and 12 hypotheses have been developed based on the research model to examine the relationships between enduring involvement and five components of perceived risk, between five components of perceived risk and required trust level, between enduring involvement and required trust level, and finally between required trust level and preference toward an e-tailer. To attain our research objectives, we conducted an empirical analysis consisting of two phases of data collection: a pilot test and main survey. The pilot test was conducted using 25 college students to ensure that the questionnaire items are clear and straightforward. Then the main survey was conducted using 295 college students at a major university for nine days between December 13, 2010 and December 21, 2010. The measures employed to test the model included eight constructs: (1) enduring involvement, (2) financial risk, (3) performance risk, (4) delivery risk, (5) psychological risk, (6) social risk, (7) required trust level, (8) preference toward an e-tailer. The statistical package, SPSS 17.0, was used to test the internal consistency among the items within the individual measures. Based on the Cronbach's ${\alpha}$ coefficients of the individual measure, the reliability of all the variables is supported. Meanwhile, the Amos 18.0 package was employed to perform a confirmatory factor analysis designed to assess the unidimensionality of the measures. The goodness of fit for the measurement model was satisfied. Unidimensionality was tested using convergent, discriminant, and nomological validity. The statistical evidences proved that the three types of validity were all satisfied. Now the structured equation modeling technique was used to analyze the individual paths along the relationships among the research constructs. The results indicated that enduring involvement has significant positive relationships with all the five components of perceived risk, while only performance risk is significantly related to trust level required by consumers for purchase. It can be inferred from the findings that product performance problems are mostly likely to occur when a merchant behaves in an opportunistic manner. Positive relationships were also found between involvement and required trust level and between required trust level and online merchant choice. Enduring involvement is concerned with the pleasure a consumer derives from a product class and/or with the desire for knowledge for the product class, and thus is likely to motivate the consumer to look for ways of mitigating perceived risk by requiring a higher level of trust on the part of the online merchant. Likewise, a consumer requiring a high level of trust on the merchant will choose a digital storefront rather than an e-marketplace, since a digital storefront is believed to be trustworthier than an e-marketplace, as it fulfills orders by itself rather than acting as an intermediary. The findings of the present research provide both academic and practical implications. The first academic implication is that enduring product involvement is a strong motivator of consumer responses, especially the selection of a merchant, in the context of electronic shopping. Secondly, academicians are advised to pay attention to the finding that an individual component or type of perceived risk can be used as an important research construct, since it would allow one to pinpoint the specific types of risk that are influenced by antecedents or that influence consequents. Meanwhile, our research provides implications useful for online merchants (both online storefronts and e-marketplaces). Merchants may develop strategies to attract consumers by managing perceived performance risk involved in purchase decisions, since it was found to have significant positive relationship with the level of trust required by a consumer on the part of the merchant. One way to manage performance risk would be to thoroughly examine the product before shipping to ensure that it has no deficiencies or flaws. Secondly, digital storefronts are advised to focus on symbolic goods (e.g., cars, cell phones, fashion outfits, and handbags) in which consumers are relatively more involved than others, whereas e- marketplaces should put their emphasis on non-symbolic goods (e.g., drinks, books, MP3 players, and bike accessories).

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Perceived Risk Factors Affecting Consumers' Online Shopping Behaviour

  • THAM, Kok Wai;DASTANE, Omkar;JOHARI, Zainudin;ISMAIL, Nurlida Binti
    • The Journal of Asian Finance, Economics and Business
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    • v.6 no.4
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    • pp.249-260
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    • 2019
  • The study examines the impact of financial risk, convenience risk, non-delivery risk; return policy risk and product risk on online consumer behavior of Malaysian consumers. The research employed a self-administered survey to collect empirical data from 245 Malaysian online shoppers by using convenience sampling. Cronbach alpha was calculated to confirm the reliability of the data and then normality was assessed. Confirmatory Factor Analysis was then conducted to test the model using the goodness-of-fit tests. And finally, structural equation modeling is used to test the hypotheses and draw conclusions. IBM SPSS AMOS version 22.0 was utilized for data analysis. The research indicates that product risk, convenience risk, and return policy risk have a significant and positive impact on online shopping behavior. Financial risk is found to have insignificant and negative effects on consumer behavior. In addition, the non-delivery risk is found to have a significant and negative impact on online shopping behavior. The findings provide a useful model for measuring and managing perceived risk in online shopping which may result in an increase in participation of Malaysian consumers and reduce their cognitive deficiencies in the e-commerce environment. Several managerial implications are discussed along with the scope for future research.

A Study on the Effects of Price Discount, Product Review, and Perceived Risk and their Interaction Effects in Social Commerce (소셜 커머스에서 가격할인, 상품후기, 지각된 위험의 영향과 상호작용에 관한 연구)

  • Bang, Jounghae;Qian, Chen;Kim, Min Sun;Lee, Eun Hyung
    • Knowledge Management Research
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    • v.14 no.4
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    • pp.87-98
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    • 2013
  • Along with the recent development of Social Network Service (SNS), such as Facebook and Twitter, social commerce market is expanding rapidly. As much, understanding consumers' purchase intention in social commerce becomes important. This study attempted to investigate the factors of consumers' purchase intention, and the effects of these determinants(price discount, perceived risk and product review) on consumer's purchasing intension in social commerce networks. Also, the interaction effects between these factors on consumer's purchasing intension were studied. The results showed that the effect of perceived risk on consumer's purchase intention found to be significantly negative. The interaction effect between price discount and perceived risk, and the interaction effect between price discount and review were meaningful on consumers' purchase intention. It indicates that the important factor for consumers to purchase products in social commerce is not just price discount but perceived risk, and that review which consumers think is manipulated has negative effect on purchase intention.

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Background and Develpoment of Caries Management based on Risk Assesssment(CAMBRA) (임상가를 위한 특집 2 - 우식위험도 평가에 근거한 치아우식증 관리(CAMBRA)의 이론적 배경 및 발전 과정)

  • Cho, Young-Sik
    • The Journal of the Korean dental association
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    • v.52 no.8
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    • pp.464-471
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    • 2014
  • This article reviewed theological background and historicak development in dental caries management by risk assessment. Dental caries prevention and treatment according to CAMBRA model is patient-centered, risk-based, evidence-based practice. Team approach is necessary and clinician need to integrate science, practice and product. Dental hygienist take a important role in implementing CAMBRA. CAMBRA model could be incorporated into dental and dental hygiene education. Dentist and dental hygienist able to provide scientific and ethical care managing dental caries by risk assessment.

Project Scheduling Technique for New Product Development (신제품 개발 프로젝트 일정관리기법)

  • Ahn Tae-Ho
    • Management & Information Systems Review
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    • v.14
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    • pp.67-77
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    • 2004
  • Although project management for new product development is a very important issue, only a few approach from project scheduling has been made. The traditional project scheduling research has focused on the project network with certainty, but the new product development project has some uncertainties in network; Some activities may not need to be peformed, and/or some precedent relationships between activities may not need to be kept. In this paper, a simulation model is introduced in order to reflect uncertainties in project network for new product development. This simulation model can be used as a project scheduling technique for product development. By repeating the simulation, the degree of the risk and the feasibility of the project can be assessed.

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Analysis of Installation Environment and Fire Risk of Induction Motors Installed in the Curing Process of a Rubber Product Manufacturing Plant (고무제품제조공장의 가류공정에 설치된 유도전동기의 설치환경 및 화재위험성 분석)

  • Jong-Chan Lee;Doo-Hyun Kim;Sung-Chul Kim
    • Journal of the Korean Society of Safety
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    • v.38 no.2
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    • pp.23-29
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    • 2023
  • This study analyzed the fire status of a rubber product manufacturing factory based on 19 years of fire data. Through the analysis of the current state of fire, electrical fires accounted for 58.19%, and among electrical fires, motor fires were the highest at 26.21%. For the motor fire occurrence process, the curing process accounted for the highest rate of 51.9%. Therefore, the installation environment was investigated for the motor in the curing process, and it was confirmed that the motor's maximum ambient temperature exceeded 40℃. In particular, in the case of the motor for curing operation, the motor was installed in a separate motor room, so the average indoor temperature was 48.10℃ and the motor frame's maximum temperature was 72.80℃. In this study, the risk of motor fire was confirmed through a field survey, and a safety management plan was derived by finding a process with high fire risk and conducting an experiment on the motor's installation environment and electrical characteristics in that process.

CRPN (Customer-oriented Risk Priority Number): RPN Evaluation Method Based on Customer Opinion through SNS Opinion Mining (CRPN(Customer-oriented Risk Priority Number): SNS 오피니언 마이닝을 활용한 고객 의견 기반의 RPN 평가 기법)

  • Yoo, In-Hyeok;Kang, Won-Kyung;Choi, Kyu-Nam;Park, Ji-Yun;Lee, Geon-Ju;Kang, Sung-Woo
    • Journal of Korean Society for Quality Management
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    • v.47 no.1
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    • pp.97-108
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    • 2019
  • Purpose: The purpose of this study is to propose a new Risk Priority Number(RPN) evaluation method which analyzes value of product functions by mining customer opinions in Social Network Service(SNS). Methods: A traditional RPN is measured by three evaluation standards (Severity, Occurrence, Detection) which are analyzed by manufacturing engineers and researchers. On the other hand, these standards are analyzed by customers' viewpoints through SNS opinion mining in this research. In order to extract customer feedbacks from textual data sets, the methodology in this paper implies natural language processing, hereby collecting product related data sets and analyzing the opinions automatically. An emotional polarity of an opinion indicates severity, while the number of negative opinion shows occurrence, and the entire number of customer opinion refers to detection. Results: The results of this study are as follows; As a result of the CRPN evaluation, it is confirmed that the features evaluated as risky are highly likely to be improved in the next series. Therefore, CRPN is an effective risk assessment model that reflects customer feedback. Conclusion: Reflecting customer feedback is a useful tool for risk assessment of the product as well as for developing new products and improving existing products.

An Objective method of risk assessment based on RAM analysis for warship (함정 분야의 RAM분석 기반 위험평가 방안)

  • Beak, Yong-Kawn;Kang, Byoung-Soo;Jo, Kwan-Jun
    • Journal of Korean Society for Quality Management
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    • v.43 no.4
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    • pp.511-520
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    • 2015
  • Purpose: This study suggests a method of risk assessment based on RAM analysis in order to reduce the subjectivity. Methods: RAM analysis is used to assessment risk consequence(RC) and risk likelihood(RL). Result: The calculated result of the product, which has higher risk assessment, shows lower MTBF system. Conclusion: Risk assessment based on objective database will provide objectivity and effective quality control.

A Study on Developmemt of Heat-Emission Prevention Device for SSR (무접점스위치(SSR) 발열 방지 장치 개발에 대한 연구)

  • Lee, Man-Soo;Kim, Jun-Yong;Kim, Jin-Bae
    • Journal of the Korea Safety Management & Science
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    • v.21 no.4
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    • pp.25-30
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    • 2019
  • Electric of using in daily life is always exposed to risk of electrical fire and electric shock. Only degree of risk is different, there is no risk free electrical product. Generally, the higher voltage, the risk of electric shock is high. The much electric current, the risk of electrical fire is high. But, we can't help using electric because of risk and we effort to reduce the risk of electrical fire and electric shock. This study deal with the fire prevention generated on heating equipment using SSR for current.

A Study on the Relevance of Risk Transfer and the conformity of goods in Trade Transactions (무역거래상의 리스크이전과 물품의 계약적합성에 관한 연구)

  • Chung, Jae-Hwan
    • Korea Trade Review
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    • v.44 no.2
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    • pp.159-172
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    • 2019
  • An important issue in trade transactions is risk management. Trading partners focus on how to recognize risks and how to address these areas. This article discusses whether the quality of a substantial period of time remains appropriate to the contract even after the risk has been transferred. If the contracted product is not delivered, then the risk is not transferred because it does not fulfill the obligations of delivery. In order to prevent such risks, the Seller must regard the quality of the goods of their fulfillment and provide them to the Buyer in detail. In addition, it is necessary to carry out several times of transportation or insurances of insurance according to the transaction conditions. Commercial practice comes from repetitive trading activities over many years. I think it is constantly changing as the transaction continues. Changes in the way of international commerce always create new orders and regulations. We need to keep a close eye on them.