Decision Making in the Simmons Bank - Essay Example

Task One - Research Planning for Decision Making Background for Research Simmons Bank has requested that Milton Brown undertake research in order for the bank to improve all forms of interaction that they have with their customers. As a result of the recent controversy over the mis-selling of Payment Protection Insurance (PPI) products, Simmons Bank has lost a significant percentage of domestic accounts. Although Simmons Bank admitted to the mis-selling of these products and set aside £1bn in compensation funds, confidence has been lost in the bank. PPI is a type of insurance designed to pay out if a policyholder is unable to pay credit card and/or other monthly debt payments because he or she has suffered redundancy or ill health. However, many of the people sold PPI found they were not eligible to claim, others did not understand that purchase of the policy was voluntary, and some did not even realize they had bought the cover (Insley, “Barclays to settle PPI claims no questions asked “).The number of complaints over the controversial loan insurance has risen by 93% in the first half of the year - and is expected to continue to increase. There has been a level of overcompensation on Simmons Bank’ behalf in respect of communication as a result of this dispute. Simmons Bank has greatly increased its volume of communications to customers via direct mail, phone and emails trying to rebuild customer confidence in the bank and also to win back affected customer’s support. This high volume of communication annoyed customers even further and consequently, resulted in even more complaints being made about the bank. The purpose of the research is to rationalize the best way of communicating and determine when and how customers prefer to be contacted. Simmons Bank target market is the general public however its customer population can be broken into segments: Mass, middle, affluent, and students. Task 3 – Observation Techniques Jane Williams 07/05/2012 Mystery shopping is a technique that is used to evaluate any type of customer interaction and to test anything from product knowledge to customer service/politeness, handling of complaints and the follow-up procedure, refund and exchange procedures and sales skills. The ultimate aim of mystery shopping is to improve customer satisfaction thus increasing sales and customer revenue. This method of research allows an organization to view their product or service from the perspective of the customer or client and accurately identify individual staff’s strengths and weaknesses, as well as organizational strengths and weaknesses. There are various different forms of mystery shopping but all seek to serve the same purpose. The four types are video mystery shopping, written reporting mystery shopping (or physical mystery shopping), phone mystery shopping and Internet mystery shopping. Simmons Bank could benefit from using any one of these methods of mystery shopping and they would all provide useful insight into how Simmons Bank and its employees conduct business. Some questions that physical mystery shopping, video mystery shopping and telephone mystery shopping could aim to answer may include, ‘is the product I am looking for easily accessible?’, ‘is the salesperson well informed?’, and ‘is the salesperson attentive?’ Some questions that internet mystery shopping could aim to verify, may be ‘is the site user-friendly?’, ‘is it easy to find what I am looking for?’ ‘Is it easy to send an email enquiry?’ this method of mystery shopping research could provide insight for Simmons Bank into customer’s online experience of the bank. It could also help identify key areas of improvement if the website was proven to be non user-friendly and uninformative. The mystery shoppers that would be used for Simmons Bank’ research would need to be representative of the target market. To gain a true representation of a customer’s experience of Simmons Bank, a mystery shopper from each of the market segments should conduct the exercise. There should be a mystery shopper representative from the student bracket, the mass market bracket, the middle bracket and the mass affluent bracket. Establishing and maintaining a mystery shopping programme: 1. Establishing In order to establish a mystery shopping programme, it is imperative for Simmons Bank to first define the objectives of the research. The objectives in this case are; Firstly, to determine the quality of the contact between Simmons Bank and its customers, post the findings of the questionnaire and interviews conducted to determine customer’s preferred types of contact from Simmons Bank. Thirdly, to determine if staffs are conducting the highest level of customer service that is expected of them when doing so. The specifications also need to be established in these initial stages of setting up a mystery shopper programme. Specifications: Simmons Bank will be launching a new ISA and wants visibility on the quality of customer service being given to customers when they call into a branch to find out more about the application, when they phone the customer service line to get more information and when they go to Simmons Bank.com to get further information. Simmons Bank also wants to ensure that the findings of the preferred contacts research is being implemented by staff and customers are being contacted as often as they specified and by the means of communication they prefer. The product will launch on the 5/6/2012 and the mystery shopping research should be conducted over the course of two months from the date of the launch. This will be in conjunction with a marketing campaign focusing on the new ISA. Recruit: The mystery shoppers used for this exercise must be representative of Simmons Bank’ target audience. Mystery shoppers are trained in what to observe, checked for memory retention and memory recall – because they cannot always record at the point of contact. So shoppers are not ‘naïve’ – they need project specific training on schedule completion. The encounter may be basic or complex, but must be objective, observed directly rather than interpreted (facts not perceptions) (Jesson, “Mystery Shoppers”). They will need to be briefed on exactly what they are looking out for in the branch, on the phone and on the website. For those visiting a branch, they will need to complete a post visit evaluation questionnaire. Lastly, a mystery shopper work programme will need to be drawn up and sent to each of the participants, with a running order of the various tasks to be completed and a timeline for indication of how long each activity should take. 2. Maintaining a mystery shopper programme: Training Adequate training programmes are required for all mystery shoppers, which need to be carried out before the initial mystery shopping task and on a quarterly basis for consistency and to keep the skills learned fresh in the mystery shopper’s minds. Rewards and incentives Sales tend to increase at a much faster rate in the process of holding a sales contest where the winners would be determined by the scores of mystery shopping. The prizes often involve trips or cruises to the various desirable destinations. Program Consistency It is important for the success of the mystery shopping that the programs should be carried out for the consistently maintain the program. The shopping must takes place on a going basis so that the employers can perform as though each of the customers is a mystery shopper (Service Trac, “Three Ways To Get More for Your Mystery-Shopping Dollar”). In addition to this, Simmons Bank should store details of each mystery shopper in a database for future mystery shopping projects. Advantages and Disadvantages of establishing a mystery shopper programme As with all research methodologies, there are advantages and disadvantages to mystery shopping programmes. The advantages outweigh the disadvantages; however it is important to be aware of the pitfalls of mystery shopping so they can be avoided. Organisation should be aware about the use and advantages of the mystery shoppers. Therefore they must: feature the specific purpose of the business; And accordingly assess the impact of monitoring on autonomy, privacy and other legitimate rights of the staff. Those initiating the activities of mystery shopper’s must comply with the Act of Data Protection and also of Human Rights (Partners IN Salford, “Advantages and Disadvantages”). Advantages Disadvantages Replicating the customer experience by using the target audience as shoppers Gaining insight on how to improve the customer experience It can compliment other customer satisfaction surveys an efficient way of identifying staff in need of further training a regular summary of strengths and weaknesses which can be your action plan It can be regarded with suspicion by staff who may feel defensive about this undercover technique High cost. Mystery shopping is resource intensive if you use a large sample Although mystery shopping provides an illustration of the customer experience, it does not specifically measure customer satisfaction For Simmons Bank, the advantages of a mystery shopping programme far outweigh the disadvantages, some of which are avoidable and some of which are minor issues but still worth noting. By evaluating the service customers receive, evaluating the conclusions and implementing the necessary changes, Simmons Bank can aim for higher customer retention levels and increased profits. Is Mystery Shopping an Appropriate Research Method for Simmons Bank? Mystery shopping has its own advantages and disadvantages. The advantages are more and much more productive than the disadvantages. It is through mystery shopping that customers experience can be replicated with the help of the shoppers, measures can be taken to improve the customers experience but at the same time, mystery shopping usually involves a huge amount of cost and most importantly it does not measure the customer satisfaction. Thus it can be said that mystery shoppers are useful only when the quality and the standard are to be checked, uncover the needs of training within the particular outlet but when it comes to customer satisfaction, mystery shopping cannot be regarded as one of the best tool. Mystery shopping is an appropriate research method for Simmons Bank, as each of Simmons Bank’ customer touch points can be evaluated. Mystery shoppers can visit a Simmons Bank branch, call a Simmons Bank customer service line and go online and use the customer service email tool on the site. As Simmons Bank has a healthy budget for developing and maintain a mystery shopping programme, it will provide ongoing quality assurance and control, once all the findings are addressed and with the view to improve where necessary. Reference Insley, Jill. “Barclays to settle PPI claims no questions asked”. The Guardian. Jun. 2011. http://www.guardian.co.uk/money/2011/jun/13/barclays-settle-ppi-claims Jesson, Jill. “Mystery Shoppers”. A Typology of the Research Method – Mystery Customer. Apr. 2005: 10. http://www.m-e-l.co.uk/Casestudies/05.01_A_Typology_of_the_Research_Method_Mystery_Shopping.pdf Partners IN Salford, “Advantages and Disadvantages”. Mystery Shoppers. ServiveTrac. “Three Ways To Get More for Your Mystery-Shopping Dollar” Mystery Shopping as a Training Tool. Read More