Excellent Service Delivering in ICICI Bank - Research Paper Example

Introduction: The aim of the paper is to select an organization in service operation, and detail the way the service of the organization is designed to deliver excellent service. The paper will substantiate why the organization is believed to deliver excellent service with reference to literature on service delivery and service excellence. Along with this a comprehensive view of the organization or the service enterprise will also be illustrated with data and analysis on the data so presented. An explanation regarding the collections of data for the data analysis is also part of the assignment. An analysis and critic view of the service delivery of the organization in alignment with the service delivery or service excellence literature will also be portrayed. At the end an evaluation of what is being learnt from the organization will serve as a conclusion. In accordance with the requirements of the paper the service and the service organization undertaken for this study is a banking service organization in India called "ICICI Bank" Here is a brief outlook on the organization. Overview of ICICI Bank Ltd., ICICI Bank Today "ICICI Bank is India's second-largest bank with total assets of Rs. 3,744.10 billion (US$ 77 billion) at December 31, 2008 and profit after tax Rs. 30.14 billion for the nine months ended December 31, 2008. The Bank has a network of 1,420 branches and about 4,644 ATMs in India and presence in 18 countries. ICICI Bank offers a wide range of banking products and financial services to corporate and retail customers through a variety of delivery channels and through its specialised subsidiaries and affiliates in the areas of investment banking, life and non-life insurance, venture capital and asset management. The Bank currently has subsidiaries in the United Kingdom, Russia and Canada, branches in United States, Singapore, Bahrain, Hong Kong, Sri Lanka, Qatar and Dubai International Finance Centre and representative offices in United Arab Emirates, China, South Africa, Bangladesh, Thailand, Malaysia and Indonesia. Our UK subsidiary has established branches in Belgium and Germany." (ICICI bank online) History of ICICI bank "ICICI Bank was originally promoted in 1994 by ICICI Limited, an Indian financial institution, and was its wholly-owned subsidiary. ICICI's shareholding in ICICI Bank was reduced to 46% through a public offering of shares in India in fiscal 1998, an equity offering in the form of ADRs listed on the NYSE in fiscal 2000, ICICI Bank's acquisition of Bank of Madura Limited in an all-stock amalgamation in fiscal 2001, and secondary market sales by ICICI to institutional investors in fiscal 2001 and fiscal 2002. ICICI was formed in 1955 at the initiative of the World Bank, the Government of India and representatives of Indian industry. The principal objective was to create a development financial institution for providing medium-term and long-term project financing to Indian businesses. In the 1990s, ICICI transformed its business from a development financial institution offering only project finance to a diversified financial services group offering a wide variety of products and services, both directly and through a number of subsidiaries and affiliates like ICICI Bank. In 1999, ICICI become the first Indian company and the first bank or financial institution from non-Japan Asia to be listed on the NYSE." (ICICI bank Online) Literature - Service delivery /Service excellence : Service delivery and excellence in service is the key word for organizations involved in the service industry. In the book of "Service operations Management: Improving service delivery" Service delivery is explained as "understanding the needs of our customers, managing the process that delivers services, ensuring our objectives are met, while also paying attention to the continual improvement of our services." The book also defines service from the customer's perspective by saying, "service is the combinations of the customers' experience and their perception of the outcome of the service." The experience at a theme park for example, includes the experience of the rides and the restaurants, and the outcomes will include the food and drink, the emotions of enjoyment and their view of value for money at the end of the day."(Johnston 11) A service experience the book says "The service experience is the customer's direct experience of the service process and concerns the way the customer is dealt with by the service provider. It contains aspects of how customer-facing staff, interact with customers and also the customer's experience of the organization and its facilities." (Johnston 11) Service outcome is described as "the result for the customer of service delivery. The key and most obvious output is the expected and often tangible output of the service. Examples of this might be the ability of a recipient of a software training course to construct a spreadsheet or for a patient in a hospital to enjoy full mobility after a hip operation"(Johnston 12) The book further lists less tangible out comes such as value, emotions, judgments and intentions. While the book of Robert Junston, explains the various aspects involved in the process service delivery a journal article by Theo Gilbert Jamison CEO of Performance solutions by design which is a global performance consulting firm catering to luxury and premium brands with an emphasis on transforming organization culture states six principles of Service Excellence. To start with: Principle 1: Vision and Mission: "World-class organizations that are able to create and sustain a culture of service excellence have a sound vision and mission that is known, owned, and energized by every employee. In such cases, their vision statements clarify what they aspire to be in the future; while their mission statements articulate their purpose, what they stand for."(Jamison 2009) Principle 2: Business objectives: "World-class organizations that are able to create and sustain a culture of service excellence have clear, simple, quantifiable organizational goals and objectives that every employee is aware of." (Jamison 2009) A clear business objective that is communicated and understood by every employee leads to the development of service excellence and eventually the organization will adapt itself to a service excellence model. Principle 3: Service standards: "The purpose of service standards are to clarify for employees exactly what actions and behaviors are expected of them in driving excellence everyday, and creating customer loyalty."(Jamison 2009) Principle 4: Intervention and Learning Strategy: Every business must have a sound financial strategy in place. World class organizations lay the same emphasis in developing systems and processes in order to interweave Vision, mission, Business objectives and service standards. Principle 5: Organizational Alignment: In order to create and sustain service excellence standards world class organization ensure the organizations goals , objectives and service standards are regularly discussed and checked with employees. They are completely aware that only if the employees align themselves to the organizations objectives service excellence can be achieved. ."(Jamison 2009) Principle 6: Measurement & Leadership Accountability: "The purpose of service standards are to clarify for employees exactly what actions and behaviors are expected of them in driving excellence everyday, and creating customer loyalty." (Jamison 2009) The above literature explains to us the concept of service delivery and the essentials for the achievement of service excellence. Going forward let us look at the chosen bank in terms of principles, systems and processes it follows to achieve the desired benchmark of service excellence. Initiatives for effective Service delivery.. Over viewing some of the best practices, initiatives and developments ICICI bank has made in order achieve service quality and service excellence, are the improvements in customer satisfaction scores, cycle time and sales revenue. The bank created hundreds of hiring opportunities due to its rapid scale of mergers and acquisitions. It called itself "The Indian face of global banking" A recruit of 800 new banking employees with little or no banking experience gave a huge blow to the customer satisfaction scores of ICICI bank. In order to meet service standards the bank created a new Structured Workplace Induction and Functional Training (SWIFT) program. This oriented new employees and provided online performance support. The components of the program included a video on customer service, visits to a bank branch, online performance support, an interaction with the senior leaders of the bank, e learning banking software and role simulations. The result of this comprehensive training program for the new recruits saw a 49% jump in the customer satisfaction scores. (ASTD 2004) Similar improvements were seen in the other departments of the bank namely cash remittances, and account opening processes. The Six Sigma process was followed to take care of error rates in the bank .By training nineteen employees in Six Sigma, problem solving and change agent roles and responsibilities and asking them to handover the same across 300 branches in the country ensured the sharpening of service quality and service delivery.The bank blended a new program called "Selling skills for bankers" which resulted in a 50% increase of sales and a 66% increase in all cross sell figures. (ASTD 2004) Systems and Processes for Service excellence.. Working on systems and processes to improve service excellence the bank with the support of TATA interactive systems worked towards reducing customer wait time. "For a bank manager of ICICI bank improving the customer's satisfaction levels is the primary concern. One key factor is customer wait time; the time customer spends waiting for service at the branch. To help reduce wait time ICICI bank introduced the Dynamic Queue management (DQM) system to assign specific banking services to each of the service counters at the branch. The DQM system then automatically assigns incoming customers to relevant counters. Ideally this should reduce bottlenecks at any particular counter, reduce customer wait time, and add to customer satisfaction. But, the branch managers needed to be sensitized to its abilities to help them manage queues - something they were prone to doing manually on the branch floor." (TATA 2009) To handle this TATA interactive systems used their Game based learning Objects model to create an analogous universe for the branch managers where they single handedly controlled an airport's services. The objectives of the program where : To internalize need for frequent DQM monitoring, analysis and service assignations.; To provide practice in an immersive and safe environment ;To use games as skill enhancers; and communicate the implications of ineffective usage of the DQM system namely - irate customers, reduced efficiency at the branch and the back log at service desks. (TATA 2009) This resulted in increasing the scale of service excellence for the bank. It primarily reduced the number of lost customers - the reduction in attrition or the beginning of a downtrend in attrition due to the service quality and excellence in service delivery. It also allowed branch managers to experiment different service configurations. Principles and code of conduct for service excellence ICICI bank follows a strict code of conduct with respect to its service delivery and compliant handling system. This further helps in maintaining transparency in operations with customers at the same time boost reliability among customers. The code of conduct is as follows: Giving you information about them in any one or more of the following languages: Hindi, English or the appropriate local language. b. Ensuring that our advertising and promotional literature is clear and not misleading. c. Ensuring that you are given clear information about our products and services, the terms and conditions and the interest rates/service charges, which apply to them. d. Giving you information on what are the benefits to you, how you can avail of the benefits, what are their financial implications and whom you can contact for addressing your queries and how.( ICICI 2009) To maintain an ethical and professional attitude in handling customer complaints the bank advocates the following principles: Correcting mistakes promptly and canceling any bank charges that we apply due to our mistake. b. Handling your complaints promptly. c. Telling you how to take your complaint forward if you are still not satisfied, providing suitable alternative avenues to alleviate problems arising out of technological failures. ( ICICI 2009) Data analysis: The data analysis is through data extracted from secondary sources and is based on an interview conducted between the customers of two banks, The State bank of India and the ICICI bank. (The State bank of India is the largest public sector bank of India which is more than triple in size when compared to ICICI bank.) . The data collection for this analysis is also through other secondary sources like the Internet and the fact sheet of the two banks. The analysis and survey is to compare and contrast the customer satisfaction variables and scores between the two banks in order to evaluate the service excellence of ICICI bank. Mean and mean differences have been calculated for analysis of the data. The table will strongly relate to two primary aspects of customer satisfaction, reliability and tangibility. Each question to the customer is based on a 7 point scale Strongly agree ----5 and Strongly disagree-----1. Table 1: Tangibility ratings State bank of India ICICI bank S.No Dimension Mean Mean 1 Up to date equipment 4.1 6.53 2 Physical facilities 3.47 6.58 3 Neatness of employees 5.18 6.95 4 Communication material 5.11 6.89 Tangibility (1+2+3+4) 17.84 26.93 Source: CBS Interactive Table 2: Reliability ratings Conclusion: Analysis of Data: The data presented in tangibility and reliability clearly shows the superiority in service delivery of ICICI bank with SBI. While the differences in the tangibility stand at 9.09 quite a huge margin the tangibility factor , the difference in the dimensions of reliability are negligible. It proves that the safety and security customers align with the nationalized banks are seldom enjoyed by the private players in most parts of the country. Though ICICI bank scores above SBI in all parameters one should keep in mind the size and set up of the State bank of India. ICICI bank has no doubt emerged as a successful leader in among private banks and its constant renovations and changes in the systems and procedures towards service delivery has helped gain a much higher score on the tangibility factor. Source: CBS Interactive Evaluation: On evaluating the overall performance of the bank in terms of its initiatives, systems, processes and code of conduct the bank has clearly penetrated every area in its business to ensure quality customer service delivery and ensure standards of service excellence. The bank in accordance with the six principles of service excellence has ensured the vision and mission of the bank are communicated to every employee, and the business objective aligned through the training and development of systems, procedures and technology in order to maintain service standards and ensure service quality. Overall the bank is in a continuous phase of improvement in services, service quality and moving towards a higher bench mark of service excellence. Learning: The study on the bank has given rich insights regarding the essentials of service delivery and service excellence. It highlights the importance of customer satisfaction and the articulation of various departments systems and processes in order to achieve service excellence. In the age of the consumer the bank clearly operates and positions its service for the customer to see value and maintain a long term relationship with the bank. References: ASTD best Awards. 2004. American Society for learning and Development. 22 April 2009. http://www.astd.org/NR/rdonlyres/B1A5882A-C337-4DED-AED8-BEC93FD0BD2B/12892/2004BESTAwardsBooklet.pdf ICICI bank website. 2009. ICICI bank Limited. 22 April 2009. www.icicibank.com Johnston, Robert & Graham Clark, Service operations Management: Improving service delivery. London. Prentice Hall. 2005. Jameson Gilbert. 2009. Ezine Articles. 22 April 2009. http://ezinearticles.com/The-Six-Principles-of-Service-Excellence&id=2194232 Rajkumar. Bnet. January 2008. CBS Interactive.22 April 2009. http://findarticles.com/p/articles/mi_7058/is_1-2_17/ai_n28556199/pg_11/tag=content;col1 Tata Interactive Systems case study 2009. Tata Interactive Systems. 22 April 2009. http://www.tatainteractive.com/casestudies/ICICI_DQM_Case_Study.pdf Read More