Developing an edge in the Banking Industry using Customer Service Excellence

The world has become a “Village” what Marshall McLuhan (1962) called Global Village, therefore consumers are now more enlightened and as such expects the very best products and services from any business they patronize. Every business that must continue to grow and be of relevance to consumers must continue to serve them excellently and make them perceive the service as best for them. Businesses will only survive when the needs of consumers are met adequately. Entrepreneurs created companies to meet specific consumer needs, it is important not to forget that meeting the consumers needs alone does not solve their problem; how and where the customer needs are met are very significant questions in the determination of whether they will do more business or tell others about the services experienced. The how and where questions are necessary fundamentals to the People, Process and Environment (PPE) concepts of excellent customer service.

A. Coskun, Cheryl J. Frohlich (1992) mentioned that “Service is the competitive edge in Banking”, these authors emphasized that “Customers are demanding more humanized banking and that banks must evaluate their marketing deficiencies and become more proactive. They believe that having a model for developing a bank’s effectiveness and improving customer satisfaction will create a competitive edge”.

What is an edge?

Though the circulated topic says “Developing an edge in the Banking industry using Customer Service excellence”, the only edge that must be developed in a business is one that is competitive. A competitive edge is also known as competitive advantage; it was described as an advantage over competitors or rivals gained by offering consumers greater value, either by means of lower prices or by providing greater benefits and service that justifies higher prices (Tutor2u.net, nd). For simplicity sake, competitive advantage refers to the best position an organization can be when compared with its rivals. If a company decides to use lower prices as a competitive advantage over other companies at the detriment of its service, it will only get the customers for a while after which they will all run away looking for organizations that can give them service reliability. A common example in Nigeria is the Telecommunications industry in which operators tries to outperform competitors by crazy reduction of tariffs and unimaginable promotion and bonanzas. Most times, this measure only succeeds at increasing the subscriber base temporarily, the consumers who later finds out that the organization has started experiencing difficulties in giving excellent service normally goes back to where they are coming from or either move ahead in search of other companies that can better meet their needs.

Who    - The People Factor

There is intense competition amongst Banks nowadays, international banks now compete with local banks for the same funds hence the struggle for deposits and financial transactions have continued to be on the rise. All banks now offer similar products and services; this gives customers a big chance of deciding carefully to choose which banks they will patronize. One of the ways an organization can meet up with this ever increasing standard expected by customers is by maintaining an excellent workforce. This means that the question “who” is answered by the employees and the management.

-              Every employee must be a customer service officer

-              Managers must hire employees with customer service and people orientation

-         After hiring, new employees must be thoroughly trained in the vision and mission of the organization.

-              On the job, there must be constant practical and theoretical training sessions

-              Employees must consciously build Team spirit

-              Employees that can maintain their cool under pressure are more desirable

-            Many service businesses are discovering there is a high correlation between happy employees and long-term organizational success. After all, it's your staff that provides the service that your customers pay for that keeps your bank profitable. – Sanflippo Barbara (1993)

-              Unhappy employees don’t enjoy serving customers (They should not work in a bank)

-              How employee feels towards the following is very important

o   Teamwork

o   Goal clarity

o   Sales and service leadership

o   Fear of making decisions

o   Poor communication

o   Career path

o   Staffing and training.

To further hammer on the significance of the People factor, some proven ways to energize a banks quality service as dictated by Sanflippo, Barbara are as follows:

1. Conduct a Sales and Service Climate Survey
2. Create a Staff Satisfaction Index and Build It into Your Strategic Plan
1. As Federal Express believes, if your staff satisfaction index (SSI) keeps climbing, your customer satisfaction will increase and these two factors will have a positive effect on your bank's results.

3.  Get as Many of Your Employees Involved in the Process as Possible (if possible all your employees)
4. Recognize and Reward Your Staff for Service and Sales Performance
5. Enhance Your Orientation Program
1. Most banks are concerned with the first impression their customers receive in dealing with their staff. How about the first impression your new staff member receives from your bank the first day of employment? Do they feel welcome and important? Do they thoroughly understand your bank's commitment to and their role in the quality service culture? Walt Disney Studios and the Ritz Carlton Hotels believe staff orientation is their opportunity to instill their customer first philosophy and gain the respect and commitment of every new staff member. Your orientation is a golden opportunity to reinforce your new employee's decision to work for your bank, to start to imbue the bank's mission and values and gain commitment to the quality service process.
6. Invest in Your People with Quality Training

  

How – The Process Factor

“Excellent customer support is a critical factor in overall customer satisfaction, and hence loyalty. It is recognized as a significant enabler to growing market share in a highly competitive market”. J Trigger and M Harrison (2006). This confirms Roth and Jackson (1995) quoted by Frances X. Frei and Patrick T. Harker (nd) “process capability and execution are major drivers of performance due to their impact on customer satisfaction and service quality in banking”

The best processes in banking today must consider the following:

-              The cycle time (amount of time from start of process to finish)

Every Bank and Branch must adopt a method that does not waste customers’ time while capturing all necessary information for a particular transaction. It must be done in line with the common saying “Do it right at the first time without errors” associated with Phillip Crosby. Customers get irritated when they have to waste so much time perambulating about one process indefinitely, this makes them feel that the bank or its official lack the credibility to deliver on their demands. It is not a lie that bad processes kill business.

-              Labour skill

The type of labour required to perform a process must be meticulously considered. If wrong unskilled labour or semi skilled labour is employed for a job that must be done by skilled labour, good process can be carried out wrongly and will result in bad service which eventually leads to reduction in customer’s satisfaction index. New processes must be communicated well ahead of time so that employees can learn and absorb them before the go live time. There is no doubt that every staff has a responsibility of updating themselves on latest processes as the Bank management also invests in Business Process Reengineering.

-              Technology

In our world, this seems the most important. The rate at which new and better innovations are created makes one to wonder if there will ever be a process that will remain constant forever. Change is the only constant thing, and by that saying; every organization that refuses to keep up the pace with Technology is heading for a doom. Nigerian Banks started using ATM’s and found out that even the processes of managing the machines are also highly significant at determining whether customers will patronize a bank’s machine over the others. Examples include the processes of cash reload, retract card or cash retrieval, ATM servicing and maintenance, and every other process that would make the machine work in perfect condition. If the processes are too long, then customers will feel the negative impact and may run to competitor’s machines.

Excellent management of Bank processes will reduce waste to the minimal thereby reducing cost as well as increase profitability. The following are examples of classic types of waste prevalent in the Banking system:

Seven Classic Types of Wastes

1. Overproduction
2. Waiting
3. Transportation
4. Over-processing
5. Inventory
6. Rework
7. Motion

Where – The environment factor

The peculiarity of a business environment speaks volume about how responsible the business managers are. Since the number of competing banks is ever increasing, bank or branch management staff must do everything possible to remain in the good books of customers. Failure of which will lead to customer loss.

The reason for this is not farfetched, customer perception of a company is made in the first few minutes of contact with the company’s premises. It is likely that more depositors will prefer to pay in their money in a well lit and attractive environment rather than a dark and dirty environment. Banks should begin to look at how customers do not need to come into the premises to make cash deposits too. This should be an innovation for the soonest future.

All those things that shape how our environment looks also determine if a customer will come back for more transactions or not. They include:

1.                  The signage

2.                  The Wall paint

3.                  The toilets

4.                  The window blinds

5.                  The floor

6.                  The staff outlook and dressing

7.                  Spatial arrangement

8.                  The car park (and more)

Value versus Service

Do you prefer Value to Service?

Like many would say, both value and service are important to any organization that must continue to exist. Others could prefer value to service, while some would prefer going in the reverse. It is no news that every profit oriented business is created and funded so that shareholders may have dividends from their investments. Notwithstanding, this still does not totally stipulate that the business is existent because of the profit alone. It is the customers that bring the profit with their requests. When they don’t come, the profitability won’t come. This places the responsibility of looking for what would make the customers come on the management and every internal stakeholder of the business. In some organizations, employees who are seeing to add immediate value gets more reward compared with those that gradually and consistently contribute to the business. Should this be so? No, not at all! It is very good to recognize both the marketing and the operations staff who are meeting the customers’ needs, but with the right balance that would continue to favor customer service and not just one off high performance. Let’s think of a scenario where the customer is brought and there is no one with the professional capacity or technical knowhow to attend to his request. In this case, the customer will leave in annoyance and never to come back again.

Customers are the reason businesses exist and what they want to get is the service. When they get excellent service, they are sure to come back for more. However, organizations have continued to place more value on employees that seemingly brings the short term huge business rather than those who retain the not so big businesses that would stay for long. It is very true that without the huge businesses, profits might be limited, but it is also certain that when the huge businesses are not forthcoming, the not-so-big businesses that have been successfully retained would sustain the company. If they had not been retained and maintained, the result would have been very negative for the value proposition of the organization. One thing that should always be remembered is that, bringing a business can never equal retaining it. The ability to bring a business is just too small compared to that required to retain it. A business that is brought and not retained constitutes to only a short term benefit for the organization, whereas any business that is retained will continue to meet the profit speculation of shareholders. So which one would you say should be strategically pursued? It is better to look at service as most important. Hence, as management reward value adding employees, service excellence should also get the commendation from the top executives.

Conclusively, service is the reason why the customer visited in the first place. If the customer learns that service cannot be rendered as expected, the business or transaction request is taken to any available alternative solution provider. Monthly performance report sessions of profit oriented organizations should adapt their focus to catering for sessions that would evaluate what their businesses has to offer the customers. Customers won’t come to tell you what they need if you don’t care to ask them. One way these customers would be sure that your company cares about good service is to see that the employees that serve them are happy and knowledgeable about what they do. This calls for employee motivation. According to Hezberg, key components of service like employee achievement, employee recognition for achievement, interest in tasks, responsibility for enlarged tasks and growth and advancements to higher tasks can all be described as motivational factors (Adewusi, 2011). These factors produce long term positive increase in productivity and would eventually add more value to the business. Unlike the immediate value that is achievable from huge businesses brought in without a certainty of its retention with the organization.

Service Soliloquy - 18/8/2012

Three things you should not do to a customer:

There are so many things never to be done to a customer. In my own view, any attempt to do them is not just counterproductive but suicidal for organizations that claim to be customer centric. It was in responding to a blog request that I recalled from some experience that customers don’t want to get this kinds of treatment from the companies they patronize.

1.       Never tell a customer he is stupid

Normally, common sense should have warned any employee never to attack a customer verbally, but customer service professionals yet fall into this abominable malady. An earlier blog article of SuccessDrive mentioned how an employee repeatedly and overtly attacked a customer with blatant insults. He was approached about his unruly act but he never regretted what he did. Instead, he tutored the observers of his dastardly act on how never to annoy an employee under pressure. Can we then say that the customer needs the employee more than the employee needs him? No! This employee already lost it. He had written his own sack letter which will manifest soonest. This is not being negative or pessimistic; he should have known that the business is existent to serve the customers. When the customers refuse to come, the business will close shop and he has to stay at home.

2.       Never toss the customer around

The customer is king is a common cliché used in business circles. Do businesses really mean it? If yes, then how many employees have turned their kings to and fro in the name of serving them or responding to their requests. It is anomalous to push a customer around. Employees are there to direct the stranded customers to the exact table where he would be served. What we find in most organizations are employees who readily turn the customers back because the customer failed to do it the way they expected. And yet, we keep saying these same customers are kings. Who is fooling who? Customers know those organizations that are lying about serving them excellently and will stop patronizing them gradually.

3.       Never argue with the customer

Customers do not like to know they are wrong. And if you must tell them that they are less knowledgeable about an issue, it has to be done with respect, empathy and understanding. That way the customer will not get offended. Many organizations have encouraged their employees to fall into the taboo of arguing with customers either because they refused to train them or sometimes because they roll out controversial policies. It is very important for businesses to take cognizance of the fact that, a well appreciated customer consistently treated with respect will market the company positively. He is sure to tell others about the excellent service in what is known as “positive word of mouth.” This only suggests that, instead of arguing with the customer, employees should listen more to understand the customer’s plight and offer alternative solutions that would get his problems solved.

Many of the customer service failures occur because employees are not trained. Sometimes they also occur because the companies are not really concerned about the customers but preach service just for the lip service. Organizations that would succeed by exceeding the expectations of its customers must first know the customers, what they need and how to meet the needs. Otherwise, treating customers with lip service and a neglected promise of excellent service delivery can only lead to the demise of an unsuspecting organization.

Service Soliloquy - 17/8/2012

The unruly employee:

I was in the office of a well known Nigerian University and observed as a medium size crowd awaited the attendant response of an officer of the institution’s cybercafé located in the administrative block. I was in a hurry just like everyone was. Knowing very well that the cyber officer is under pressure, I moved on to a user of on one of the busy computers to ask for the procedure at the internet office, before meeting with the officer in charge. This actually helped me to avoid an impending tongue lash that could have been directed at me. I knew exactly what I wanted and what I needed the officer to do for me before meeting with him, so his job was only to deliver without needing to listen extensively to what I needed. No wonder he treated my request without much problem arising, yet not with the perfect touch a customer care expectant customer like me would anticipate.

I was almost done with my request as I waited for the officer to hand over my printed forms to me. I saw a customer complaining to the officer from the other end and could not really understand what the customer wants. Obviously, the customer was complaining about the service and that he wanted the officer to attend to his case. All of a sudden, I heard the officer shout at the customer “you are very stupid for saying that”. I was taken aback and felt very embarrassed. What more can one expect? The customer retorted “who do you think you are?” and to everyone’s surprise the officer who was already fuming repeated himself. This time he made it very clear and confirmed to everyone standing “I repeat, you are very, very, very stupid for saying what you said”. Everyone was astonished that someone whose work was to bring and satisfy customers’ needs is the one responsible for their overt abuse.

I could not stand there until the matter degenerates to an unending brawl; I had to beg the customer to overlook the officer’s rudeness. I calmed the upset customer and he left somewhat in a better mood. Several customers tried to caution the officer about his unruly behaviour but he was adamant. I also met with him, trying to make him see why should accommodate all manner of pressure from his customers. My effort was fruitless as he repeated severally that the customer is very stupid. His explanation about what the customer did was only able to clarify to us that he was under pressure. He mentioned that the customer should have known that he was under pressure and should have avoided getting him upset. I had to stop when I realized that this man got it all wrong and there was nothing we could do about his attitude. Other customers confirmed that this is his usual disposition towards them and that he had even threatened to slap another customer that morning.

Now the question is, why would any employee upset his customer? Do you know of any good reason for this kind of disposition? If you have valid reasons why this customer should be treated this way or any other comments that could help with way forward on this complaint, kindly comment on the blog at http://successdrive.blogspot.com

Service Soliloquy – 14/8/2012

Significant issues in Customer Satisfaction 

Sue Barrett authored an article featured by the Customer Care Institute; she reiterated how everyone sells something consciously or unconsciously. Her submission reminded me that customers actually buy from salespeople who carefully prepare to meet their needs. The increasing number of salespeople in the world does not allow anyone to just launch a product without first planning for it. All the products being purchased today have one alternative or the other, yet customers must continue to buy. It is the active involvement of all stakeholders in the roll out of a product that counts towards how the customers would receive it. Going by the events of proactive organizations today, remarkable businesses first research what the customers wants by aligning strategic goals properly and ensuring that they fulfill the customer needs. The business is there to meet the needs of its customers, who when well served becomes a free way to advertise to others.  

The creation of a new product starts from the field where customer views and behaviours are collected, analyzed, reviewed and turned into a useful basis for customer satisfaction. Projects to launch new products should rely on what an organization gathered from the market without forgetting that the inputs from all stakeholders are very significant. Employees from operations, marketing and other support groups should be carried along in the creation of a new product. Customer observations from the front end should never be neglected as it determines how the new product would be accepted. Support from the management is a must for the success of a new product that will satisfy a most customers. As patronage increases, it influences profitability and eventually puts the meticulous organization ahead of the competition.

Businesses will continue to be in great need for excellent relationship amongst its stakeholders. This means that organizational policies should focus at all those things that would improve such relationships. This can be done by considering the people factor that would include both customers and employees. Neglecting the employees and their welfare is not only counterproductive; it can be suicidal for any corporation. Employees should have opportunities to be responsible. The system should encourage them to be nice to customers. According to Kano model as developed by Professor Noriaki Kano in the 80s, certain factors known as “Must be” should be taken into consideration to achieve remarkable satisfaction of stakeholders. The theory just like Hezberg’s theory of Hygiene factors described that dissatisfaction ensues when certain attributes that are ordinarily taken for granted in a product are neglected. Hence, the theory of holistic marketing comes to play here. Everything matters and must be well considered to satisfy the customers. It is only by satisfying the customers that business goals also become realizable.

My Service Story

Do you have a customer service story to share? 

The Success Drive blog is collecting and rewarding best stories submitted. All you need to do is to tell us what your service provider did to make you happy or upset you in your own words. The best submission enters a draw and gets a chance to be selected in a lucky dip. To participate, send your stories with the title “MY SERVICE STORY” to the successdriveltd@yahoo.co.uk. 

The best stories have a chance to be published in our new quarterly customer care journal with all the credits assigned to the author. Please send in only the stories that are written by you.

Remember to send all stories to: successdriveltd@yahoo.co.uk with the title "MY SERVICE STORY".

Continuous improvement a must

There are several ways to satisfying the customers' needs. One way to get better is by continuous improvement and objective management of customer expectations. Proactive organizations usually capitalize on both management and employee involvement to achieve significant results in overall business improvements. An example of a proactive organization is the Toyota Corporation. This automobile giant relies on a bottom-up flow of information and ideas that leads to continuous improvement. This allows for proper involvement of each work team in the identification and selection of waste for elimination. In Toyota, projects are selected by those who work in the teams and every member of a team work together to remove such waste by carefully looking at the processes. The resulting achievements of the Toyota Production System points to the fact that top management cannot just enforce change without carrying those that must change along. It is the employees that would work with the change; they are the ones that can jettison the efforts directed towards any change especially when they don't believe in it. This does not mean that only the employees hold all it takes to make the change successful. Excellent communication of ideas and information from the employees in Toyota is something to be envied; organizations that rely only on top to bottom flow of ideas may end up not carrying the users of the information along. This makes employee think that they are not responsible for the success of change initiatives. Can management achieve change without the employees who are the end users? No! Employees are very important for change that would affect them, just like the management support for such changes cannot be overemphasized.

 

 

Management should not just impose their ideas

One reason why management imposes ideas on their employees is just to ensure that the business aligns to the strategic plan of the organization. A question that regularly seeks to be answered, and in the mind of employees directs its queries to know why management should not care about the observations of the people who use the ideas, information and policies in the organization. Management cannot make change initiatives work through employee coercion. This is something that management should be aware of. Top executives should not just sit down in their cozy offices after attending a high level meeting to dish out instructions. An attempt should be made to be part of what is been endured by the lower cadre employees. The operation staffs of an international financial organization once complained that management had disrupted business severally with change initiations that are not properly coordinated. This is because no questions were asked, nor clarifications made before such changes were implemented. The effect of such change usually results in employee and customer dissatisfaction. Customers do not want change ideas that had not changed the employees working them. Therefore, the focus of every initiated change in any proactive organization is to get buy-in from the associates or employees who will use them to satisfy the customers. Management involvement is also significant in the sense that it assures the end users to whom the change is directed are they are assured that there is a high level support for the anticipated change coming from companywide involvement.

 

 

The essentials for change initiation

There is no doubt that change is the only thing that must take place in a proactive organization. Companies that don't get positioned for changes usually wakes up to find themselves far behind. This happened in the case of Polaroid, Enron and many others. Making examples of corporations that lost what they once had is not enough, but there is need to learn from them. Training employees to understand the tools of continuous improvement is very important. The stakeholders of change in an organization must understand and know how to use the tools of continuous improvement. By this they can conveniently identify and eliminate non-value adding parts of their activities and processes. When employees know why they are doing what they are asked to do and are part of the initiators, they tend to act supportively in ensuring that the change is upheld. Another thing that must be watched is the roll-out of change without proper check whether it aligns with the overall strategy of the organization. When changes are approved, there should be proper consideration for allowing it to work; otherwise it would mean another waste of resource that had to be called off in a short while. Careful consideration of effects of changes on all the stakeholders of the business before its official launch is very important and helps to get a positive triple bottom line effect i.e. people, planet and profit (Elkington, 1995).