Banking Today

by

Published: November 11,2002

For many customers, particularly those who interact with their bank via their neighborhood or office-center branch, quality service is a make-or-break proposition in the overall relationship mix. However, the manner in which banks define and support that definition of “service” isn’t always clear.

In the branch environment, the bank’s community “face” isn’t necessarily that of the CEO or the corporate executive management team. Ultimately, a positive or negative image is determined by the professionalism of the people on the brick-and-mortar front lines and their empowerment to make decisions in order to make their customers’ financial lives easier.

Whether they’re opening a checking account or asking for advice about Susie’s college education, many customers see their branch as the center of their banking universe. When they have concerns, they like knowing that they can count on their branch.

But broader trends in the banking industry have made this service proposition a challenge. In recent years, factors ranging from merger consolidations, corporate reorganizations and cost-cutting initiatives have impacted service quality at the branch level. On a national level, many of the foibles associated with these efforts have been reported in the banking and business press. But another significant factor has also affected service at the branch level and that’s organizational philosophy.

While banks have spent oodles of dollars on service training programs during the past decade, an organizational philosophy that defines “service training” simply as the mastery of operational procedures can impede progress. While this issue doesn’t get a lot of coverage in the banking press, an excellent article in a recent edition of Banking Strategies magazine outlines the challenges.

In contrast to what has been done in the past, service training programs that are now deemed more effective are placing more emphasis on solving customers’ problems in a timely fashion. While policies and procedures are a fact of banking life, thanks to the industry’s regulatory environment, banks are beginning to put those policies into a broader customer perspective.

An important key to effective service training is a reorientation from instructor lectures to role-playing under the watchful eye of trainers who can guide and coach. Moreover, banks that are committed to enhanced service training are putting this training into a more comprehensive, longer-term perspective. These banks are realizing that a one-time course or certificate of achievement isn’t a panacea for service problems. Indeed, the beneficial effects of training will disappear if they are not supported on a regular basis in the actual work environment.

Banks that have been recognized for improved training efforts, such as National City Corp. in Cleveland and FleetBoston Financial Corp., are also providing follow-up classes, on-the-job coaching by supervisors and more clear advancement opportunities based on the customer service component.

Banks are also placing more attention on turnover issues, as studies show that high levels of branch personnel turnover can leave customers with employees who are unprepared to respond to their problems.

While “hard” skills such as computer literacy and a knowledge of operational procedures are a must in the branch environment, bankers are realizing that poor service can sabotage the whole customer relationship. Increasingly, banks are recognizing that service should be more than just an afterthought in their organizational and management training programs. Perhaps one banking executive tabbed the challenge best in the Banking Strategies article: “We used to spend seven or eight days with someone in a new-hire class crunching through all the rules, policies and procedures of transaction processing. Then at the end, we would say, ‘Oh, by the way, let’s talk about customer service.’”

North Mississippi-based journalist and consultant Karen Kahler Holliday writes frequently for the Mississippi Business Journal. Send comments about her column to mbj@msbusiness.com.


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