COST EFFECTIVE SERVICE EXCELLENCE IN GLOBAL BANKING

We are always talking about delivering of good service, satisfying customers, delighting customers, understanding customer expectations etc. There are so many interpretations. But how we exactly get to know whether we satisfy our customer? 

Is he/she telling the truth?

Have we ever measure the quality of our service? 

Can we really improve a thing what we don’t measure?

Measuring the service quality should be the first and most essential step, that any business can take in improving their services.
Poor service quality can cost the business, whether business is a month old startup or a decade old enterprise. The service quality is really matters. In today’s competitive business landscape, no matter how high we set the quality bar, a business would soon come and push the bar a little higher if we  could deliver an optimum service. Therefore, we need to offer our services in such a manner to customers continuously, while controlling costs.

But how do we measure the quality of our service?

SERVQUAL- Introduction

SERVQUAL is a service quality framework that was developed in 1985 by Zethaml, Parasuraman, and Berry. Since then, it is considered as the most holistic framework for measuring service quality.

Initially the framework used ten aspects to measure service quality. Subsequently it was revised in 1988 and seven of initial aspects were combined to form empathy and assurance. This gave rise to the widely famous RATER model with five aspects to measure service quality. 

05 Aspect model of SERVQUAL

 

Reliability- Ability to deliver the promised level and type of service consistently and accurately.

Assurance-The employee’s ability to establish trust and confidence with the customer which is based on the employee’s knowledge and ability.

Tangibles-The business aspects, or service aspects that  customers see and feel (tangibles) such as website, building,  employees, and equipment etc.

Empathy-The employee’s ability to show care and genuine concern for customers.

Responsiveness-The organization’s ability to respond to the customer’s needs promptly. 

 

SERVQUAL to measure the service quality in banking industry

We must correctly focus on above key elements and have a proper understanding whether customer is fully satisfied in every ingredient.  But how we evaluate? 

What should we evaluate on customer satisfaction in global banking?

It is the positive or negative impact of the customer on these five elements

Ex- Is there a positive impact of “responsiveness” on  customer satisfaction in global banking industry?

If a customer is satisfied in every aspect discussed above, it can be treated as an excellent quality of service has been delivered to the customer.

How HR Cost strategies Involve in the service Quality?

General belief is service excellence and cost effectiveness are in conflict. Is it true? Shall we have a look?

There are so many ways to budget allocation in the field of HR. For instance, we can allocate costs according to the tasks, instead of trying to figure out what activities cost us in total.  Then we could consider the amount of money that  HR is supposed to use for the supervision of each department. Then we can look on the cost that goes for recruitment, training and development, etc. Through this the organization has more accurate image of what’s going on.

For collaborative idea, we need to start taking a closer look at the financial aspect of the HR. Planning and budgeting aren’t the only tasks that will determine the efficiency of the HR involvement. 

Cost optimization is the concept of balancing short term business needs and long term value. Hence when doing HR budgeting and funds allocation for various organizational tasks, it is important to have a proper understanding to spend money on all activities wisely without being a hindrance to the quality of service. That’s the way of sound HR budgeting should be.

some investments that would be quite good for the business in the long run, however, making them right now would compromise the well being of the organization. When it comes to the long term strategy, we need to make baby steps and figure out exactly where should the organization  be in five or ten years instead of in a month or two.
Organization need to invest in their education. HR is constantly changing and staff needs to be well informed. Further the field is heavily regulated. Hence this is something that the organization needs to pay for

Then how do you think? 

Can we cut COST without cutting QUALITY?

 Absolutely, Yes.

Organizations have achieved both  high productivity and customer satisfaction.

For an example Singapore Airlines has earned a higher reputation in the competitive  aviation industry by providing customers with exceptional quality service and same time became one of the world’s most cost effective full-service airlines.

Reference

Jochen W. (2018) cost effective service excellence.repec.org. [online] Available from : https://ideas.repec.org/a/spr/joamsc/v46y2018i1d10.1007_s11747-017-0560-7.html. [Accessed : 03 June 2021] 

Mcquerrey L. (2018) what is customer service in banking.chron.com/ [online] Available from: https://work.chron.com/customer-service-banking-12283.html. [Accessed : 03  June 2021] 

Jessica E.(2019) activity base costing.bcsconsulting.com[online] Available from: https://www.bcsconsulting.com/blog/activity-based-costing-abc-easy-as-123/. [Accessed: 03  June 2021]