Connect with us


Why are local banks lagging behind in quality customer service delivery




Our local banks in Ghana (critically, the older banks) appear to be crippled by a cancerous cultural paradigm. These banks are usually unconcerned about the ongoing changes in the financial world. These banks behave as if they are rendering a favour to customers by serving them and as such portray a lackadaisical attitude and gross disrespect which have turned out to be norms in our banking system. Is this the culture?

Excuse me! Banking service is no favour. It is a high end business aimed at bringing in profit to the bank. Therefore, the Customer is King. The service a bank is delivering is aimed to make profit. Some of our local banks have an impregnable cultural paradigm. By Cultural Paradigm, I mean a set of assumptions held in common by all the staff and management yet taken for granted in the bank. These paradigms are often unspoken within the bank.

Some of our local banks have existed more than three decades in the Ghanaian banking market. Nevertheless, the annual financial performances of these old banks are nothing to write home about. One may ask the following question: Why are they not leading the pack? Why are they not able to raise the money to acquire the smaller and vulnerable banks who cannot meet the new minimum capital requirement? BANKING I believe it is because these banks do not have the balance sheet to give them the capacity to initiate acquisitions of this nature.

Corporate Culture, I believe, is a contributory factor to the poor financial performance of some of the banks. One may argue that just as we all can talk about different cultures such as French Culture, Arab Culture and Ghanaian Culture so can we equally give commentary on our local banks cultures; such as ADB Bank culture, Barclays Bank culture, Cal Bank Culture, Fidelity Bank culture, GCB Bank culture, Stanbic Bank culture Zenith Bank Culture, GHL Bank Culture etc. According to Charles Handy “Culture is the way we do things around here”. Culture is expressed as being the way people go about doing things around their environment where they belong or occupy.

Therefore, a corporate culture is the way staff do things around the company. This means the sum total of their belief, knowledge, attitudes, norms and customs that prevail in the organisation. The second tier of culture can be found in a sub-culture. A sub-culture is described as a group of people within a culture (whether distinct or hidden) which differentiates them from the larger culture to which they belong. A corporate culture has always aroused interest.

These interests in corporate culture have been sustained in both academic and professional environments and have been sustained and indeed raised by an increasing globalisation and knowledge. According to Andrzej Huczynski and David Buchanan (2001), organisational culture was originally introduced to managers predominantly by consultants. Corporate culture recently has proven to be very important.

  • Power Culture: Denoted by the Greek god “Zeus”, a Power Culture normally exhibits one major source of power and influence. It focuses on personal charisma and risk-taking.
  • Role Culture: A Role culture is denoted by the Greek god “Apollo”. In this version of culture, people describe their job by its duties, not by its purpose. So job descriptions dictate “the way we do things around here”. This form of culture is usually common in a bureaucratic organisation, where the organisational structure determines the authority and responsibility of individuals and there is a strong emphasis on hierarchy and status. This culture turns to focus on positions, bureaucracy, and hierarchy.
  • Task Culture: Task culture is denoted by the Greek god “Athena”. The emphasis here is on achieving the particular task at hand and staff may need to be flexible to ensure deadlines are met. People thus describe their positions in terms of the results they are achieving. Nothing is allowed to get in the way of task accomplishment. This is best seen in projects teams that exists for a specific task. Focus on problem-solving, teamwork, creativity.
  • Person Culture: Denoted by the Greek god “Dionysius”. Person Culture is characterised by the fact that it exists to satisfy the requirements of particular individual(s) involved in the organisation. The focus tends to be on individual needs (selfinterest) and independence. People in this type of corporate culture appear to ignore or breach corporate policies and procedures.

Once upon a time, I started my career as a bank clerk. I worked hard and was nominated as the First Male Teller in the bank I worked. In my experiences, some bank staff were seen as more cut for the Tellers (Cashiers) role than others. In those days, I saw it like “The Beauty and the Beast Contest”. The smiley types who wear a smile all the time, persons who were neatly dressed and presentable, persons who appear lively and bubbly all the time; these types of persons did well as Tellers because they smiled at you when you enter the banking hall. They were warm. Their smiles were always infectious. It is a big deal to us – customers – because it made customers felt welcomed. Just imagine when you walk into one of these institutions: a legal firm, a boutique shop, a nightclub, a bank or a hotel. What do you see that gives you your impressions about the place? A good corporate culture has good performance benefits to all stakeholders and as such we have to manage our corporate culture carefully because it impacts on:

• Customers

Poor corporate culture hinders quality customer service delivery. In a real case, one local bank failed to process a well labelled cheque paid into a customer of the bank’s account. The cheque was clearly labelled ‘special clearing’ instructions for more than 72 hours. Reason: Was mistakenly mixed with local clearing. Unbelievable excuse from the bank. It simply failed to deliver so the excuses were totally unacceptable.

• Team behaviour

In a Person cultured environment, some staff become powerful to the detriment of the team’s success. This is normally the case when people are appointed through introductions or referrals of a high placed director or shareholder. Such appointees assume unhealthy role of leaking team information to their referees. Consequently, they undermine the whole team’s togetherness and bonding. Some supervisors refuse to talk to these appointees for fear of intimidation.

•Easy decisions and control by Management

Staff who wield Person powers in a branch can frustrate management decisions because of fear of intimidation or reprisal. In one case study, one local bank junior staff who got employed through a connection with high-powered director(s) and or executive person(s) became a weaker link in the communication channel created by the bank. He/ She literally blocked management’s decision flow at his/ her desk because she/he knew a “director”.

• Staff performance and evaluation

In a person culture, individual staff performance becomes virtually impossible. In the case of the aforementioned example of the staff having a related link or relationship with an executive director or board member, some senior managers are not able to confront such staff on nonperformance issues. The said staff becomes untouchable. This leads to low performances in benchmark targets of the overall bank performance.

• Training and Development

In a very highly entrenched corporate culture, the people do not accept criticism of their behaviour. Consequently, training and development becomes impaired. Even when training is delivered, it is always watered down and not seen as a serious catalyst for change.

• Product development

Poor corporate culture generates poor products or services. It is strange but true that a poor corporate culture can so easily permeate an organisation’s values to dilute good product/service. This is especially relevant in a service industry such as a bank. A bank service is intangible. Therefore, a bank service can easily be incarcerated by a poor corporate culture.

This is due to the inseparability feature of a service and the deliverer of the service. Therefore, organisational culture varies from organisation to organisation while national culture differs from nation to nation.

In order not to be judgemental on a particular bank, (whatever the type of culture a particular bank has), let the bank’s management team ask themselves the question and answer themselves: Does our existing corporate culture impacts on our financial performance positively or negatively? Sometimes attitude, style and behaviours of staff towards a service delivery could fuel the anger of a customer.

On the contrary, some of the newer banks in the country are performing financially better than these older banks. Could these be attributed to culture or a case of wrong people placed in wrong roles? Although, the concept of organisational culture is not universally accepted it remains controversial, and the paradigm and definition wars continue to rage.

Others may reject the argument of different corporate cultures. Nevertheless, Corporate Culture is believed to affect organisational performance. Therefore, bank executives are expected to manage the respective corporate culture in their banking environment so as to improve the banks financial performance.

Continue Reading
Click to comment


Transforming Banking Operations to Suit New Age Customers



Customer needs are rapidly changing. To meet those needs, banks need to make customer experience the starting point for process design.

In todays banking, people do jobs that majority of customers never see but without which a bank cannot function. Thousands of people handle the closing and fulfillment of loans, the processing of payments, and the resolution of customer disputes. They figure out when exceptions can be made for customer approvals and help the bank comply with money laundering rules, to name but a few.

Ten years from now, back-office operations will look starkly different. For starters, far fewer people will be needed. Research estimates that 75 to 80 percent of transactional operations and up to 40 percent of more strategic activities can be automated. Operations staff will have a very different set of tasks and thus will need different skills. Instead of processing transactions or compiling data, they will use technology to advise clients on the best financial options and products, do creative problem solving, and develop new products and services to enhance the customer experience. Banks, in other words, will look and feel a whole lot more like tech companies.

Customer– The starting point for Banking Operations Transformation

Financial institutions need to do big picture, board-level thinking about how to prepare for the revolutionary impact digital technology will have on banking operations. With operations consuming 15 to 20 percent of a bank’s annual budget (Exhibit), transforming these functions will lead to significant improvements in profitability and return more capital to shareholders. It can also boost revenues by enabling banks to provide better products and services to customers.

Today, many bank processes are anchored to how banks have always done business—and often serve the needs of the bank more than the customer. Banks need to reverse this dynamic and make customer experience the starting point for process design. To do so, they need to understand what customers want, and how and when they want it. Instead of a major cost center, operations of the future will be a driver of innovation and customer experience.

Six defining characteristics of future banking operations.

  • Distinctive, Personalized Products and Services

Today, banks offer standardized products hardcoded with specific benefits, parameters, and rules–30-year mortgages, travel rewards credit cards, savings accounts with minimum balances. A variety of operational roles are charged with supporting these products and managing the rules governing them. In future, these activities will be automated, and employee roles will shift toward product development. Instead of evaluating credit risks and deciding on mortgage approvals, operations staff will work with automated systems to enable a bank to offer its customers flexible and customized mortgages.

  • Extensive use of automation and new technologies that empower the customer

Automation and artificial intelligence, already an important part of consumer banking, will penetrate operations far more deeply in the coming years, delivering benefits not only for a bank’s cost structure, but for its customers. Digitizing the loan-closing and fulfillment experience, for instance, will speed the process and give customers the flexibility and freedom to view and sign documents online or with their mobile app. Typically, consumers have to wait at least a month to get approval for a mortgage—digitizing this process and automating approvals and processing would shrink wait time from days to minutes.

Same for call centers. Instead of waiting on hold or being pinballed between different representatives, customers could get instant, efficient automated customer service powered by advanced AI.

AI and advanced analytics could also improve dispute resolution. Customers can contact their bank any time through internet, mobile, or email channels and receive quick, real-time decisions. On the back end, systems would perform almost instant data evaluation about the dispute, surveying the customer’s history with the bank and leveraging historical dispute patterns to resolve the issue.

  • Seamless processes and consistent quality

Today, many operations employees perform dozens or even hundreds of similar tasks every day–reviewing customer disputes on credit or debit cards, processing or approving loans, making sure payments are processed properly, and so on. It’s not surprising errors happen.

Automating these and other processes will reduce human bias in decision-making and lower errors to almost zero. This will give operations employees time to help customers with complex, large, or sensitive issues that can’t be addressed through automation. And these employees will have the decision-making authority and skills quickly resolve customer issues.

  • Analytics-driven proactive management

The use of predictive analytics can dramatically improve the management of operations in several ways. First, it enables operations leaders to be more precise and accurate in their predictions. Instead of using simple arithmetic based on a limited number of variables to predict demand, demand predictions for specific products and services can be made based on granular profiles of customer segments and customer behavior using dozens or hundreds of variables. Banks can build detailed profiles from a multitude of data sets–including online interactions, geographic information from cell-phone usage, and aggregated payments behavior–and then apply analytics to predict the needs and desires of their customers—down to the level of a single individual in some cases.

Comprehensive data sets will also enable managers to set more KPIs. For example, instead of tracking just average handle times and customer satisfaction at a call center, banks could drill down to see how much time millennials or residents of a particular environment spend on the phone with reps. If they spend longer than average, banks can determine why and, if needed, change how they communicate with these customers or adjust products or services to better serve them.

Finally, applying analytics to large amounts of customer data can transform issue resolution, bringing it to a deeply granular level and making it proactive not reactive. Instead of a bank addressing an error or customer problem only when it reaches a certain scale or frequency, software can find errors that happen to even just one customer, such as a fee that’s been miscalculated or a double payment to a credit card. The customer can then be alerted about the mistake and informed that it has already been corrected; this kind of preemptive outreach can dramatically boost customer satisfaction. Banks could also proactively reach out to customers whom predictive modeling indicates are likely to call with questions or issues. For instance, if a bank notices that its older customers have a tendency to call within the first week of opening an account or getting a new credit card, an AI customer service rep could reach out to check in.

  • Eliminating siloes for a simpler organization

Banks have always functioned with an organizational trinity: front offices (branches), middle offices (call centers), and back offices (operations). In the next ten years, this trinity will evolve dramatically. As we’ve already noted, back offices will slim down. Call centers will all but disappear due to AI bots and automation, and branches will be scaled down in number and transformed in function. As more customer transactions move to digital channels, front-line branch employees will operate as skilled personal advisors, helping customers get answers to complex questions that can’t be addressed digitally, giving advice about bank products and features, and generally serving as a one-stop-shop for customers in need across journeys. This is a new paradigm in which customers will receive personalized advice, relying on a simpler organization.

  • Talent as a differentiator: Going beyond the call of duty

Today’s operations employees are unlikely to recognize their future counterparts. Roles that previously toiled in obscurity and without interaction with customers will now be intensely focused on customer needs, doing critical outreach. They will also have tech, data, and user-experience backgrounds, and will include digital designers, customer service and experience experts, engineers, and data scientists. These highly paid individuals will focus on innovation and on developing technological approaches to improving in customer experience. They will also have deep knowledge of a bank’s systems and possess the empathy and communication skills needed to manage exceptions and offer “white glove” service to customers with complex problems.

Starting the Transformation

To thrive in a world where once-siloed roles like loan closing and fulfillment, compliance, and risk management become an integral part of product development, product management, and customer experience, banks will need to make major organizational changes. They will need to rethink how the people who make the bank run are going to function. This calls for three major efforts:

Develop a plan to migrate to a journey-based organization:

Today, functions such as call centers, payments processing, and risk underwriting are organized by product or segment. As banks increasingly focus on personalized interactions, a journey-based operating model will be required. With a journey-based model, banks will ensure operations resources own the customer inquiry or problem until it is solved. A journey-based model will integrate resources with different capabilities and knowledge and will cut across the currently established siloes. To do this, banks will need to re-think how they staff, measure, and track performance, and ultimately deliver to customers.

Design and implement a new talent model:

Operations employees in 2030 will need to know how to code, develop products, and understand data, but they will also need the personal warmth and insight to manage exceptions and deal with complex customer problems. To attract this kind of talent, banks will need to expand their geographic footprints and identify talent pools with the required skills and attributes. They will need a new hiring approach to assess and hire talent for operations with different skills from those required today. Finally, banks will need training approaches to develop not only technical skills, but also empathy and the ability to impress customers in every single interaction.

Build a roadmap to accelerate digitization:

Banks need to act now to develop an aggressive tactical roadmap that outlines the plan for digitization and automation. Banks that lack a clear long-term automation plan—one that will result in a fully digital operation a decade from now—will struggle to meet customer expectations.

The future will look very different for banks and their customers in 2030. Banks have a unique opportunity to lay the groundwork now to provide personalized, distinctive, and advice-focused value to customers.

Continue Reading