Service is the Problem; Technology is the Answer

Responsiveness and ease of doing business are key to member loyalty.

March 14, 2013
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In financial services, we aim to achieve stickiness and loyalty. It’s conventional wisdom that offering online bill payment and direct debit results in a member who is less likely to leave.

However, the real driver of loyalty is ease of doing business. Simply put, members will leave when it becomes more difficult to do business with you than it is to move their accounts.

Unfortunately, many organizations don’t realize they have a service issue. In a CEB TowerGroup survey, only 19% of financial services executives thought that more than one-quarter of customers experienced service issues each year.

In fact, according to the survey, 31% of customers reported having a service problem each year. Of those who experienced issues, 57% said it took a great or good amount of effort to resolve the issue, and half of those customers said they were likely to shop for a new financial institution within the next 12 months.

That’s why the way a credit union handles service issues is just as important as preventing the issues. CEB analysts have also measured customer reactions to the service they received when trying to resolve issues.

Those who received willing and capable help were 39% less likely to say they will leave the institution and were 12% more likely to say they would be willing to buy more banking services.

Reducing the effort to resolve an issue also had an incremental positive effect in both attrition risk and willingness to buy more.

The biggest increase in willingness to buy more comes when the consumer learns something new from the service experience—e.g., how to avoid fees.

To truly impact member experience, institutions have to translate these attributes into concrete actions. It’s not just training and soft skills like politeness and patient listening that are likely to improve service.

An interaction with your nicest teller will still be frustrating if the teller can’t resolve the member’s issue. Instead, all of these actions require technology that streamlines service and problem-resolution.

Willing and capable help entails getting the member to the right person quickly—through an efficient interactive voice response system or at a branch where employees have access to tools and business-process management solutions that enable them to solve members’ problems quickly and accurately.

To reduce member effort, credit unions can provide enhanced mobile banking functionality or branch kiosks for connecting with subject-matter experts. And member learning can be facilitated through online wizards and personal financial management solutions.

The next time you find yourself pondering how to resolve a service issue, consider the benefits of technology solutions. Not only can they provide a consistent member experience, but they can also improve engagement by empowering employees to resolve member issues once and for all.






NICOLE STURGILL is research director, retail banking and cards, for CEB TowerGroup.

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Great article! Unfortunately, most employees don’t feel valued or appreciated by their supervisors or employers. In fact, research has shown that the predominant reason team members quit their jobs is because they don’t feel valued. This is in spite of the fact that employee recognition programs have proliferated in the workplace – over 90% of all organizations in the U.S. has some form of employee recognition activities in place. But most employee recognition programs are viewed with skepticism and cynicism – because they aren’t viewed as being genuine in their communication of appreciation. Getting the “employee of the month” award, receiving a certificate of recognition, or a “Way to go, team!” email just don’t get the job done. How do you communicate authentic appreciation? We have found people have different ways that they want to be shown appreciation, and if you don’t communicate in the language of appreciation important to them, you essentially “miss the mark”. Additionally, employees need to receive recognition more than once a year at their performance review. Otherwise, they view the praise as “going through the motions”. A third component of authentic appreciation is that the communication has to be about them personally – not the department, not their group, but something they did. Finally, they have to believe that you mean what you say. How you treat them has to match the words you use. If you are not sure how your team members want to be shown appreciation, the Motivating By Appreciation Inventory (www.appreciationatwork.com/assess) will identify the language of appreciation and specific actions preferred by each employee. You then can create a group profile for your team, so everyone knows how to encourage one another. Remember, employees want to know that they are valued for what they contribute to the success of the organization. And communicating authentic appreciation in the ways they desire it can make the difference between keeping your quality team members or having a negative work environment that everyone wants to leave. Paul White, Ph.D., is the co-author of The 5 Languages of Appreciation in the Workplace with Dr. Gary Chapman.

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