The variety of tangibles, considered over wine

In one of our recent classes we discussed (as part of ‘Customer Service Quality’ in Retail Banking I) the five dimensions/drivers of perceived customer service quality. These dimensions are reliability, tangibles, assurance, empathy and responsiveness.

Just back from holidays, sitting in my garden with a glass of wine (the same wine, incidentally, as I drank on a lovely French terrace the week before), our lively debate on the importance of ‘tangibles’ for a bank came to mind.

The concept of ‘tangibles’ refers to the physical surroundings (e.g. bank branch) where the service is being delivered. But the idea can also, for instance, be applied to the communication materials being used – or the attire of the bank staff.

With proper research, the relative importance of the five dimensions can be evaluated.

Several, rigorous studies in various countries show a variety of results: for instance, Avkiran’s 1999 study of customer service in branch banking found that staff conduct is an overriding dimension.

Consider the following test evaluation, measuring the perceived quality of a mortgage bank adviser. Sitting in a standard, neutral office, test subjects in the role of customers gave the adviser an overall score of 7 on the quality of advice given (where 10 was excellent and 1 extremely bad). However, hearing the same adviser giving exactly the same advice, but now in a well-designed bank branch office, the ‘customers’ gave a score of 8.4.

These results offer compelling direction on where to invest and to improve: one lesson might be to better design bank interiors rather than send advisers for additional training.

Back to my garden: in France I scored my wine as a 9; one week later, in a less charming environment, my score for the same wine was a somewhat petite 7.

The debate in the classroom will continue: there is no right or wrong, only the customer is always right. Ask and carry out research with your own (potential) customers in your own market; find out the relative importance of the ingredients of customer service quality.

The results of your investigations will give you clear directions on how to enhance your bank’s customer service quality in the most effective way.

Lessons from a taxi driver…in customer service

Just a week ago I was taking a taxi ride from Heathrow to Pennyhill Park Hotel in Surrey, the chosen location for the IARB’s London Executive Management Programme. My taxi driver was a very pleasant lady, originally from Sri Lanka. As so often happens, our discussion soon turned to where I was going and why. She was fascinated to hear about the International Academy of Retail Banking and the ambition to make retail banking a profession with meaningful qualifications.

“But surely all bankers already have qualifications, don’t they?” she asked, as the discussion progressed.

I assured her that most would have very good academic qualifications, but few would have a ‘banking qualification’.

Like so many customers, she was very surprised to hear this.

The conversation then moved to my own career: 22 years in the UK, followed by 18 years in Africa and the Middle East. She was pleased to hear that I was coming back to ‘teach’ UK bankers but was yet again surprised to hear that there were no UK-based bankers attending the training.

“This clearly shows what is wrong with banking in the UK,” she quickly concluded. “They are big-headed and think they have nothing to learn.”

This lady is a retail banking customer, both personal/consumer and MSME, but she does the minimum with her banks because of the “cost and poor attitude of staff. They just don’t care.”

And she struggles to make ends meet, having to spend hundreds of pounds each month on insurance, fuel, tax and servicing: all of these costs need to be met before she has any income for herself. She relies on referrals from web site ‘taxi firms’ and any adverse feedback on her performance might see her removed, essentially closing her business. So she drives carefully and skilfully. She arrives on time and delivers people on time. She carries the bags of her clients to and from the car and even offers a small bottle of water…and she is genuinely interested in her clients.

Banking bosses now talk a lot about customer centricity, along with customer satisfaction and experience levels. Is it just talk? I wonder if they also listen?