Improving the effectiveness of banks’ service guarantees: Communication with employees

As was shown in this study, employees can create an atmosphere that discourages customers from asking for compensation. Mixed and inconsistent signals sent by employees confused many customers about the availability of the guarantee and made them reluctant to ask for it. It is clear that a successful implementation of a wait-time guarantee programme requires the full support of branch employees. It is management’s responsibility to communicate with branch employees and obtain their support for the guarantee programme. Lack of support is often created by misunderstandings about goals, implementation and evaluation issues. If these issues were clarified and employees’ concerns addressed, it is likely that management would obtain the necessary support.

In communicating with employees, management has to address the overall goals of the programme and the reasons for instituting it. Employees need to believe that management is truly committed to the programme and is really willing to compensate customers for deficiencies. In addition to the general ‘buy-in’ goal, management ought to delve into the specific implementation issue. All contingencies ought to be addressed in advance, to minimise confusion and ensure consistency. It is management’s responsibility to set clear guidelines. Some of the specific aspects that could be addressed include:

When to compensate: When should compensation be given out? Should it be given only when customers ask for it, or should employees volunteer to mention the guarantee even if customers do not ask for it? Should the guarantee be offered when customers are irate, as a way to reduce their anger? Who determines how long was the actual wait?

Dealing with abuses: How should employees handle perceived abuses? Should employees give out the compensation, even if they believe it is not warranted? How should repeat ‘offenders’ be treated? Monitoring and evaluations: How will payout data be collected and analysed? For example, the data could be maintained for each branch and/or for each employee. How will the data be used? Will they affect performance evaluations? Is management willing to allocate more resources to the branch if frequent delays are encountered? Continuous communication with customers: What is expected from employees in terms of educating and reminding customers about the guarantee programme? How often and to whom should they communicate? What priority should be given to this effort relative to other job requirements? How should in-branch information about the programme be displayed? Employee feedback: How can employees provide important feedback to management about the programme? How can implementation be improved? How often should all employees (including part-timers) be reminded and informed about the state of the programme?

The above issues constitute a preliminary list of topics that need to be addressed in discussions with employees. Every bank will undoubtedly identify additional aspects that are relevant to its situation. The goals, however, are to clarify the purpose of the guarantee programme to employees, explain how it ought to be carried out and ensure that employees are motivated to be supportive of these efforts.

The study demonstrated the potential value of a wait-time guarantee programme. By making real efforts to minimise delays and offering the guarantee, banks can reduce customer dissatisfaction caused by long waits. In order to achieve these outcomes, however, banks need to devote more ongoing attention to implementation issues. Communication with customers must be continuous and utilise the diversity of media to which they can be exposed to ensure awareness and interest. Likewise, communication with employees must be strong and sincere to enlist their support and allay their concerns about the guarantee programme and its implementation. Only then can the guarantee programme be expected to succeed and the litany of benefits described be realised.

Representative APR 391%

Let's say you want to borrow $100 for two week. Lender can charge you $15 for borrowing $100 for two weeks. You will need to return $115 to the lender at the end of 2 weeks. The cost of the $100 loan is a $15 finance charge and an annual percentage rate of 391 percent. If you decide to roll over the loan for another two weeks, lender can charge you another $15. If you roll-over the loan three times, the finance charge would climb to $60 to borrow the $100.

Implications of Non-payment: Some lenders in our network may automatically roll over your existing loan for another two weeks if you don't pay back the loan on time. Fees for renewing the loan range from lender to lender. Most of the time these fees equal the fees you paid to get the initial payday loan. We ask lenders in our network to follow legal and ethical collection practices set by industry associations and government agencies. Non-payment of a payday loan might negatively effect your credit history.

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