ANZ Bank Service Delivery System - Case Study Example

ANZ Bank Service Delivery System Outline Table of contents Executive summary Introduction Literature Conclusion Recommendations References Executive Summary The paper reviews current service management systems, service blueprinting technique utilized by the ANZ bank, Australia. The paper critically evaluates the appropriateness of the current service delivery system in terms of its strengths and weaknesses from a theoretical perspective and specifies the areas for improvement; in addition the paper suggests a Service Delivery Systems that is most adequate to improve the Service Delivery System of the organization from the clients’ perspective. Finally, the paper offers diagrammatic representation of a service blueprint incorporating the suggested improvements by justifying the envisioned suggestions the theoretical and practical perspectives. The paper provides a discussion of the evolution and application of service blueprinting techniques. The complexity and diversity of banking sector presents challenges to the offering of service by the banks to the customers. The service blueprinting method offers means of capitalising on the interaction of the bank and the customers to enhance the satisfaction of the clients. The paper discusses web based service delivery system, particularly the internet banking perspective. Background The Australia and New Zealand Banking Group Limited commonly referred to as ANZ, is the fourth largest bank in Australia and the Leading Bank in New Zealand and serves personal, small business and corporate customers. The bank offers diverse products and services such as deposit and transaction products, which include Term deposit, cheque accounts, at call deposit, Telephone banking, cash management, Overdrafts and Over the Counter banking. In addition, the bank provides international services including Off-shore banking services, foreign currency deposit accounts, Foreign exchange execution services and traveller’s cheques and global ATM access. The bank also offers borrowing in terms of commercial facilities including business mortgage Loan, credit and margin facilities in terms of leasing and asset–based finance as well as loans and guarantees. This is in addition to range of internationally accepted credit cards. In terms of investments the bank offers Capital markets instruments such as government and corporate bonds and equity derivatives in addition to alternative and structured investments including bespoke investment solutions and private equity. Moreover the bank handles managed investments and equities such as access to initial public offerings and discretionary and advisory or based portfolio management. From the planning perspective, ANZ customers enjoy estate planning and asset protection, superannuation and retirement planning including financial risk management and personal risk management in terms of insurances. The diversified nature of the banks services have made the bank to interact with customers through different levels, Barabba, (1995). There are different ways to bank by the customers such as internet banking, traditional banking, mobile banking, phone banking and ATMs and EFTPOS. The banks management espouse improvements to the efficiency and effectiveness of services; however the complexity and variability of services offered by the bank means that the bank has to utilize different Service Delivery Systems so as to achieve the desired objectives. The service encounter, which is a period of time during which a customer interacts directly with a service, the bank has therefore utilised different service delivery systems. The banking environment offers diverse service delivery components covering aspects such as identity management, authentication, charging and payment, customer data mining, content adaptation, customer interaction and analytics, and customer credit evaluations. Therefore banks had to implement different service delivery systems such as centralised service delivery system for services such as loan appraisals, client focused service delivery, location based service delivery for the branch banking services and web based service delivery for internet banking. Literature Review Web based service blueprinting technique The underlying principle about service blueprinting is that it is a process of defining the assortment of resources demanded for coordinating the various components and the performance of services. According to Gummesson, (1990) service blueprinting is a systematic way of describing a service in order to make sure that all elements are included, so that their cost and contribution to revenue in the composition of the service can be examined. However, Shostack, (1985) provided a different opinion, offering that a service blueprint should encompass three main features. These features include incorporating a time dimension within the design, fostering the researcher to ascribe the development of the service delivery system which the client experiences. ANZ bank has been promoting internet banking. This web based service delivery is founded on un-localized and internet driven service quality and customer satisfaction research. The service blueprint offers the visualization as a flowchart the service processes and interactions which encompasses the interaction with the customer in the front stage, while at the back stage there is service production. In the web based Service blueprint, the flowchart of the service processes which are based on the web tools while spotlighting on customer interactions. The web based effective flowchart analysis demands that the stakeholders such as employees to replace what they perceive of the service delivery while giving preference to the way clients experience that delivery. To the extent that the design of the service process is from a manager's perspective and task oriented, a service gap will result between actual and desired service quality. In order to objectively evaluate the web based service delivery system, an appraisal system is a requisite which includes researching customer experiences, which includes collecting all-inclusive and meticulous information concerning the client’s perception of their involvement in the service encounter. The information collected is utilized to construct a wide-ranging procedural flowchart showing the client’s participation. In addition, every step is analyzed to recognize the strengths and the weaknesses of the delivery system. The strengths are then fostered through consistent repetition, and as well analyzing the weaknesses considering the bank’s vision, mission strategic plan and capabilities. The service blueprinting creates an understanding of web based service creation by the ANZ bank and delivery systems through an inclusive description of banking service process. The service delivery should typically consider from the view point of how customers experience the service deliv, however in most cases it typically looks at the processes rather from a banks perspective company (i.e. manager’s perspective or task orientation) than customer perspective. Moreover, the blueprint shows only the observable actions or events as presented by Kingman-Brundage, (1989). Thus, an effective flowchart analysis requires managers to substitute their own perceptions of the service delivery for the way customers experience that delivery. Conceptual framework in terms of diagrammatic representations service organisations as founded through service blueprinting approaches developed by Shostack and others, aids to present a visualised perception of the selected service delivery systems and to offer a significant appraisal of the experiences of the interacting stakeholders of the service system. The web based service delivery system for the ANZ bank is founded on the web trading architecture made up of several components. The architecture of the Bank’s system shares commonality with the generic Net.Commerce system. The four major system components are the payment server, Secure Web Server, Database Manager and Net.Commerce as illustrated below Figure 1 ANZ bank internet banking architecture The Secure Web Server component is charged with the responsibility of implementing functions like receiving requests from the bank customers’ browsers and forwarding them to the appropriate application. The web server, which server implements the Secure Sockets Layer (SSL) protocol is very significant when it comes to customers’ transaction confidentiality considering that the customer's private information is captured and stored. It is also important that the system ensures that only genuine customers are able to use the system. The Net.Commerce component is very crucial towards the realization of the Service Delivery System and plays an essential role in the entire system architecture. The component performs functions such as permitting the bank’s system administrator to handle the system utilizing the secure web-based administration facilities. Moreover, the Net.Commerce verifies commands originating from the web server and processes the banking transaction requests made by the customers. The Payment Server component manages payments using online payment cards and companies, while The Database Manager component administers the Net.Commerce database which has the entire site’s data and stores business transaction data. The web based service delivery utilizes internet banking; these are banks where transactions exist solely on the Internet without being limited by the brick-and-mortar branches. The internet banking has created great competition for the traditional banking methodologies in terms of service delivery to the customers. The ANZ Internet banking permits clients to enjoy entirely all the services offered by the physical brick-and-mortar banks, with the divergence being the lack of face-to-face contact. With reduced overhead costs, internet banking has gained appreciation by several customers due to offering high-yield checking accounts therefore being much cheaper to operate than traditional banks. The salient features of web based service delivery is the service offering without being bound by the limitation of transaction time, geographical location or place, since customers can be able to complete entire transactions such as savings, mortgages, checking, credit cards, investments, bill payments and much more from any place, using any secure device which can connect to the internet such as mobile phones, laptops, personal digital assistants and blackberries. Designing the service process Whereas most of the organizations have implemented systems where managers have final say over the design of the service creation and delivery process, these has not been appropriate since the bank has little control over the client perceptions as argued by Gronroos, (2000). There has been a paradigm shift towards having procedural steps that clients can follow to receive the service. In order to condition the customer’s perceptions, the steps are considered in the environment of flowcharting the service process Normann, (2002). The steps graphically engages description of the different process procedurally hence aiding to define the sequence to define the step(s) at which the client utilises the core service and to recognise the supplementary benefits that make up the augmented product. Other researchers have extended flowcharting to incorporate service blueprinting by including the interaction with the customer in the front stage, and the invisible back stage according to Joel, Keong Leong and Keah-Choon (2004). This has assisted the banks to recognise possible fail points and to identify the usefulness of the technique for service positioning, which is usually from the banks’ perspective and considering the task from the bank employees perspective, however the perspective on the blueprinting technique may ignore the client’s perspective, James, (1996). This view is also outlined and recognised in the structured analysis and design technique, which breaks the service into small modules which offer services in modularised detailed service levels. The advances in technology has changed the approach to web based service design where innovative techniques has enabled the banks to develop service delivery mechanisms which depicting the service process more from a customer's perspective which includes sequential incident analysis, service mapping and walk-through audits. In addition to sharing similarity with brand experience mapping, service mapping is a sophisticated as well as being task oriented version of the blueprint. The web based service design is therefore and administrative tool for outlining the chronology of activities and tasks which the clients, support teams and front-line staff undertake in the performance of their duties as presented by Verma, (2007) and supported by Steve, (2005). The web based service delivery systems aims to include the bank client’s perspective in the basic steps of the service delivery process, Wisner and Linda, (2007). The flowcharting technique is important to understand the client’s service experiences. Considering that the clients interact with the web browsers not the front line staff as expected in the traditional banking scenario, the service flowcharts on the front line reflect the interaction with the web tool, that the customer utilises to access the bank’s banking system, at the back stage however, there software and hardware systems which are invisible to the customer. It is imperative to note however, that the entire front stage processes in the web based service delivery are totally reliant on the back stage processes, such as accessing the database, authentication, encryption, banking transaction updating and content editing. These services are therefore included and shown separated by a line of interaction. The general representation can be as follows. Figure 2: Flowchart action areas Considering the interacting modules in the web based service delivery, the front line staff visible to the customer are the customer support which the customers can chat with through the internet. The customer is ignorant of the presence of all the other staff, apart from the customer support. This flowchart can be graphically represented as below It is however challenging in using the web based system delivery to gauge the perception of the customers since customers perceptions are influenced by the performance of the additional environmental constructs such as the speed on their networks and the performance of the systems the use. In the traditional banking scenario, in service offering the clients experience includes perceptions of service performance added contextual embedding. These include factors such as cleanliness and privacy of the location, demeanour of the teller, appearance of the bank staff, legibility of the print outs, all these factors coalescence together to give a complete service encounter. The critical factors of the web based service offering include the feel of the web pages that the customer interacts with; this is shown by the web page of ANZ bank’s internet banking. Figure 3: ANZ web based service delivery system, Internet banking. The critical steps in the service delivery are the customer registering for the services online, using the credentials such as the username and password to access the system, ensuring the customers data security, choosing the account category, performing the transaction, seeking customer support assistance and logging off. Constructing the flowchart for analysis, aids in the identification of ‘problem’ steps, which can result to service failure in the bank. The bank can deal with all the service failures, while in some cases, can acknowledge and intentionally avoid dealing with it, for example due to incongruity with the available resources or the bank’s business objectives. Strengths of web based service delivery The web based service delivery has strengths such as tangibles including service delivery improvements, efficiency gains and cost savings, and as well as intangibles strengths such as enhanced corporate image and collaboration, improved customer satisfaction, and increased employee morale. The web based system also offers increased security where customers are assured that their transactions cannot be compromised. When the customer logs on and transacts via ANZ Internet Banking all the data is encrypted, which ensures that no hackers or crackers can compromise the information of the user. In addition, the bank utilises sophisticated monitoring technology, which monitors client’s information for suspicious activity. Therefore, the service delivery system assures clients of the privacy and security of their transactions since the online customer support contacts the customer is there is any suspicious activity on their accounts. The web based service delivery also offers anytime anywhere services, where customers can perform Internet Banking transactions available 24 hours a day, seven days a week anywhere in the world. Moreover, unlike the localised service delivery such as the branch based banking, the internet banking is available and the servers are accessible 99.9 % of the time and failures are extremely rare. In addition, customers are not limited to only computers, but there are several other mobile banking options available, such as internet enabled mobile devices, Personal Digital Assistants or text banking. The line of interaction between the bank’s staff and the customer is also available throughout the day, seven days a week. Moreover, the web based approach has strengths in terms of convenience to the customer where the customer has the flexibility to draw cheques, pay some bills, and transfer money at their convenience. Moreover, customers can Order Travellers Cheques and Foreign Cash, view foreign exchange rates, Transfer Funds overseas, and Purchase International Drafts at their comfort without necessarily contacting the bank’s staff. Moreover, the service offers customers instantaneous access to their transaction reports, easy account management and capability to make transactions, as and when needed. Web based service delivery has weaknesses in terms of service offering control where the customer can executive their transactions. It is possible for customers to make wrong transactions which can cause monetary losses, moreover customers may not be keen with their credentials, and hence their accounts can be compromised. Moreover, cases of using alias identities, can be utilised by criminals such as terrorists who can still enjoy the banking services, once they are registered. Areas of improvements Whereas the web based service delivery may look superb from the clients perspective, there are several areas which demand improvement. Customer help in the internet banking tends to be slow where the customer is connected to Interactive Automated Voice Response IVR and Auto Attendant Software which may not offer sufficient and the exact information required by the customer. Unlike traditional banking where a customer can approach customer service staff with a query, in the internet banking, customers can chat with intelligent chat systems, which may not give the required information. This is an area which requires improvement. Furthermore, there is need to address the customers security concerns due to proliferation of websites, which tend to look genuine and can coerce customers to provide their personal information. In addition, there is need to create an integrated link with the traditional account, to avoid incidences of a customer having two accounts with the bank. The databases should also be merged to synchronise the offline and online transactions. The web based registration, is also prone to abuse in terms of forgery of credentials. The security features should therefore be enhanced, with physical checking of the identities of the account applicants. This calls for integrated approach to service delivery, where the customers can access both the physical offices of the bank and the online presence. This is justified by the need to have physical contact, when the customer wants to register so that there identification details can be affirmed. This gives other customers the confidence that they are transacting with true persons, in case they have business to make. Moreover, the integrated approach to service delivery should include customer assistance, where customers are not limited to web based means of seeking information, but can make physical presence to the bank for assistance, where they can consult the bank staff in person. Moreover, there are services, which human assurance is important in giving customers the confidence they need. The bank should therefore adopt an integrated service delivery. Figure 5: Integrated approach with possible direct physical interaction between the bank’s client and staff. References Barabba, Vincent P., (1995). Meeting of the Minds: Creating a Market-Based Enterprise. Boston: Harvard Business School Press. Gronroos, Christian. (2000). Service Management and Marketing: A Customer Relationship Management Approach. West Sussex, U.K.: John Wiley & Sons. Gummesson, E., (1998). Implementation Requires a Relationship Paradigm, Journal of the Academy of Marketing Science, 26(3), 242-9. James A. Unruh. (1996). Customers mean business: six steps to building relationships that last. New York: Addison-Wesley Joel D. Wisner, Keong Leong, Keah-Choon Tan. (2004). Principles of supply chain management: a balanced approach. Indiana : South-Western Kingman-Brundage, J., (1989). The ABCs of Service System Blueprinting, in Designing a Winning Service Strategy, eds. M. Bitner and L. Crosby (AMA, Chicago). Normann, Richard. (2002). Reframing Business: When the Map Changes the Landscape. West Sussex, U.K.: John Wiley and Sons. Shostack, L., (1992). Understanding Services Through Blueprinting, in T. Schwartz, D. Bowen and S. Brown (eds.), Advances in Services Marketing and Management, 1, JAI Press, Greenwich, Connecticut, 75-90. Steve Brown, (2005). Strategic operations management. New York: Butterworth-Heinemann Verma, H. (2007). Services Marketing: Text and Cases. New Delhi: Pearson Education India. Wisner,D.,  Linda L. Stanley. (2007). Process Management: Creating Value Along the Supply Chain. Boston: Cengage Learning Read More