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Chapter11.1:Introduction

Withtheinnovationthatbeenta

ingplaceinthetelecommunication,relatedtechnologiesintheinformationprocessing

nownas"informationtechnology"thesewouldoftenhelptofuelthestronggrowthformanyeconomies.Evenban

ingindustrywasnotsparedbythischange.Todaywecannotimaginethebusinessworldwithoutinformationtechnology.Theretailban

ingindustryparticularlyhasbenefitedalotfrominformationtechnology(Berger,A.N.(2003).During1952torecenttimesarevolutiontoo

placeintheban

ingsector,wherepeopledepositedtheirmoneyintotheban

sthatwas

eptsafeandcouldbeaccessedonlythroughachec

ordraft.Buttodaythetractionscanbedoneonlinewithinsecondsthetransactionsaredone.Theban

ingindustrywasadaptingtothischange.Almostalltheban

sstartedtoseetheimpactsontheoperationsinthenewban

sinthecountry.Theban

shadalargearrangementofinformationtechnologyintheirbusinessfunctioninganditprovedoneofthebiggestadvantagesofinformationtechnology.Initially,ban

ingwasdonepersonallywherethecustomerhadtotraveltotheban

toeithergettheinformationordothetransaction.Intheban

everythingwasdoneonpaperthatistheledgerboo

sformaintenanceofaccounts,ta ingcustomerinformation,chec s,receipts,inandoutboo maintenance,transferofmoney.Retailban

ingisaverybroadandalwaysrelateswiththecommercialban

salsowithindividualcustomersasinthebalancesheetitshowsboththeassetsandtheliabilities.Fortheliabilitiesitdealswithsavingsorcurrentorfixedaccountsalsotheloansandmortgagesli etheeducational

orhousingorthepersonalloanfortheassetssideastheseareveryimportantproductsthatareofferedbytheban

s.Thisalsohasservicesthatincludethecreditordebitcardsortheservices,whicharerelatedtodeposits.Retailban ingisnothingbutprovidingservicestoboththecustomersandthesmall-scalebusinesses,whicharehavinganumberoftransactionsoflowvalue.Thisisverydifferentwhencomparedwiththenormalban

ingwherethecustomersarelargeinnumberli

ethegovernmentsorbigenterprisesorthemultinationalcompaniesthatdealinsmallernumberswithahighvalueinthetransactions.

Lendingandretailban

ingbothareconsideredmanyatimeassynonyms,butitisassumedtobeapartofretailban

ing.Thecustomersaregivenpriorityinasmoothwayinthisretailban

ing,anditismainlydividedintothreeimportantformsandtheyareasfollows:themultiplegroupsofcustomerseitherbeitfo

rsmallbusiness,consumerorcorporate.Themultipledistributionchannelsli

ethebranch,callcenterandInternetandthelastoneisthemultipleproductli

ethesecurities,creditcards,insuranceanddepositsandinvestments.

Apowerhasrisenupinthegovernmentgreaterthanthepeoplethemselves,consistingofmanyandvariouspowerfulinterests,combinedinonemass,andheldtogetherbythecohesivepowerofthevastsurplusinban

s.Thechangestartedveryslowlywithpreliminarysoftwaresorthedatabaseforthemaintenanceoftheirdatainthebac

ground.Andgraduallyitstartedtogrowandimportanceofinformationtechnologywasincreasing(Hotelling,H.(2009).Itwasusedineverysectoroftheban

.Theyintroducednewtechnologiesandmadetheprocessmorecustomerscentricandwitheachnewtechnologytheban

receivedgreatappreciationfromtheircustomers.Forverysmallinformationthecustomerhadtotraveltot

heban

butaftertheinformationtechnologycameintoexistencethetransactionbecomeveryeasy.Towithdrawortodepositmoneythecustomerhadtowaitforhisturn.Butinformationtechnologyhascomeupwithasolutionforthisproblemtheyintroducedthetellermachinewhichisan"AutomatedTellingMachine(ATM)".Inwhichthemoneyisstoredandatthesametimecustomercangethisaccountinformation.TheyintroducedtheplasticcardscalledastheDebitCard.Thiscardcangiveaccesstothecustomertoeitherwithdrawordepositmoney,getinformationaboutisbalanceallthisbyfollowingfeweasysteps.Andtheban

shavealsoconcentratedmoreonthesecurityissuesalsowherethecustomerwouldnothavetoworryaboutmisusingofhis/heraccountinformation.Thecustomers


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gothabituatedwiththesetechnologyandtheystartedtowithdrawmoneyonafrequentbasis.Andthemanyotherapplicationswereintroducedintheban

ingsectorbytheinformationtechnologyli

etheonline,mobileservice,SMSservice,electronicauthenticationandelectronicsignatureservices(Rohlfs,J.(2004).Andtheban

ingindustryhasalsota

encareofthesecurityasitplaysavitalrolewhenthetransactionsarethroughtheInternet.AsecuredsiteisprovidedtothecustomertoperformhistransactionsthroughtheInternet.Nootherindustryhasgainedprofitfromthisastheban

ingsector.Asinthemiddleofaneconomicfallandthereformingofthefinanciallegislationtotheban

ingindustryinthepastfewyearstheimpactoftheseinformationtechnologiesinnovationsonthecustomerbehaviorwasveryhuge.Theinformationtechnologyhasintroducednewwaysofdeliveringretailban

ingtothecustomersandhenceretailban

shavefoundthemselvesattheadaptationoftechnologyforpastdecades.

Themainquestionrisesisthattheretailban

customersareabletoli

ethistechnologyservicesaremoreinterestedabouttheoldertraditionthathadaban

ingstaff spersonaltouchtoit.Astheservicesthatthecustomersreceivearegivenbytheban

sareafterwor

inghours,thehelpisavailabletothecustomer24/7,withgivenaccuracyandreliabilityandatlowcost.Thesehavebecomeimportanttotheretailban customerswhencomparedtothetraditionalsystem.Thenewimprovedtechnologicalhelpthattheban

saregettinghavebecomeveryfamousamongtheircustomers(Milne,A.(2006).

Withtheretailban sreputationintheban ingindustryithastothin ofnew

strategiestosatisfytheircustomersandalso

eeptheirloyalty.Understandingwhataretheimportantpointersaboutthecustomersthatwould

eepthemsatisfied.Meetingthecustomersexpectationshouldbethefirstthingto

eepinmindoftheban to eeptheloyaltyofthecustomer.

Everyone

nowsthatcustomersaremore

nowledgeableandmores

epticalthaneverbeforeandthatintoday senvironmenttheydoalotmorehomewor

beforecommittingtoaban sservice.Manyconsumerswillchec productsandpricesonlinebeforema

ingadecisionaboutwhattopurchase.HSBCprobablyhasabusinessobjectivetodrivemoretransactionstoitswebsitewhichisunderstandable,butifyouwanttomaintaintrust,youwanttomaintaintrust,youshouldaimformaximumtransparency(Shu,W.andStrassmann,P.A.(2005).

Intheretailban

ingindustrytheyhaveseenaspeedygrowthduetotheWebthatiscreatinggreatopportunitiesforthenewbusinessesintheretailban

s.Anditalsoshowsanimportantmethodtoseeavailableban

ersinthemar

et.Expertsestimatesthatconsumeruseofon-lineban

ingserviceswillincreaseover20foldbytheendofthecentury.Geographyandthenumberofbranchesbecomeirrelevantandcommunityban

sareabletoofferthesamelevelofserviceandconveniencetocustomersasthelargestban

s.Inthepastover60%ofexistingban

customershavecitedban

selectiontobebasedonconvenienceoflocation.Forthecustomersoftoday,convenienceoflocationincludestheavailabilityof24-houraccessviatheInternet.Currentprogressesunderelectronichavemadethegrowthunderelectronic-basedself-assistance(etal.2003Dabhol

ar).Thesegrowthsaremodifyingthemethodwithwhichassistancebusinessanduserscommunicationsareincreasingthehostof

thestudyandprocedureproblemswithrespecttothereleaseofe-assistance.E-assistanceisevolvedintohighlysignificanttoevaluatethefailureorsuccessoftechnologicalbusiness(etal.,2001,Yang),yeteventogivetheuserswithgreat

nowledgeregardingthecommunicativesurgeofdata.Theeconomicalmethodthroughouttheglobehasbeenexperiencingmanymodifications.Achievementsandalliances,liberalism,enhancedrival,modifieddatamethodsandelectronics,andmanmeanswithdistincttalentsaresimplysomeimpactswhichareeffectingtheban

ingcommerce(Pereira,1995).Electronicistheprogressingmovingimpacttoday,indistinctorganization.Asaresult,Itisessentialtoreviewtheinterestsunderelectronicandtheirscope


3/44

intheban

commerce(1994,WalterandSaunders;1994,SethiandKing).Thisisspecificallysignificanttodeterminetheelectronicwhichisthelabourexhaustiveactions,decreasingassistanceandfunctioningrate,enhancedassistancestages,andenhancingtheaffectivityandrivalryoftheUKeconomicaldivision.Electroniciscreatedbasedonfindingsintechnology,itemenhancementanddevelopmentinapparatus,method,andautomationanddataelectronic.Even,thiscontainsthemixofdata,experience,andconcepts(2003,Murungi).Thereviewsneedtheextensiveresponsibilityoftheinteractionsamongassistancecharacter,userfulfilment,andeconomicalaccomplishmentwhereface-to-facecommunicationbetweenuserandwor

erandisthemeretarget.Currently,asaresult,theelectronicspossessunusualeffectonthedevelopmentofassistancereleaseselections(2002,BagozziandDabhol

ar).(1994)Dabhol

ardeclaresthatiftheuserisinimmediateinteractionwiththeelectronicthenthereislargeroperationli

ewithwebban

ing.Nevertheless,whenthereisnodirectinteractionli

ebyphoneban

ing(becausetheelectronicisnotapparenttouserswhocanmerelypressthephonenumbersovertheir

eypadoftelephone)thisisthoughtthatthereislowpowerobtainedovertheuserintheprocessofthistransaction.(1985)Batesonhasmademanynumbersofreviewsontherequirementforcostumerstogetthepowerintheprocessoftheassistanceencounters.Iftheuserselectsindependentlytoutilizetheelectronicli

ethemethodofassistancerelease,thenthescopeislargeintheformoffeatureattributes.Afewofthefeaturedeterminations,whicharelargelyessentialtousers,areproductivityandaccuracy(2000,Bateson).Assistancefeatureareidentifiesli etogettheabilitytoreleasetheprocedu

raladvantagesli

eenhancedusercustodycostsandthereforetoincreasethefunctionalproductivityandincome(2001,Rustetal.;2003,Cronin;2003,Zeithaml.etal).Oliveira(2002)proposedthate-assistancefeatureisbetweentherivalabilitiesoftheindustrywhichresultinfirmaccomplishmentandMenorandRoth(2003)loo

attheproblemstoexecutetheassistanceelectronicande-assistancesli

etheimportantunderassistancefunctionsandWardandAl-Hawari(2006)showsassistancefeaturescopesonuserfulfilmentthatresulttoinfluencetheeconomicalaccomplishmentofban s.ElectronicandAssistanceQualityTheconceptionof,andquic

progressesin,electronic-basedforms,mainlytheonewithrespecttotheInternetresultsinimportantmodificationsunderthewayoftheindustriesthatcontactwithusers(Zin

hanandParasuraman,2002;2005,Baueretal.).Thisfashioniswellorganizedintheassistancecompanyandthe

assistancegiversaredisputingtoexchangeinelectronictoprotecttheirfuturein2012,ontheApril12technologicalperiod(2005,Prybuto

andZhang;2005,Baueretal.).Thedisputefirmatmosphereundertheeconomicalassistanceretailhasevenleadundermorestressonban

stoenhanceanduseotherreleasedplatformswithaloo

toimpressmanyusersandenhancetheunderstandingofusersandenergizethesincerity(2005,Baueretal.;2005,LeeandLin;2005,Parasuramanetal.).Betweenmanycurrent-releasingplatformsorientedistechnologicalban

ing.Underitseasymethod,thetechnologicalban

ingimpliesthesuppliesofdataoftheban

anditsitemsoverthewebsiteoftheInternet.Theimplementationofuserfriendlyelectronic(li

ethemenumovingtheautomatedtellerdevices,phone,andInternetban

ingassistances)li

ethesourcesofreleasingtheban

ingassistanceandevolveintothegeneralplaceundercurrent

decadesli

ethemethodofsustainingtheusersincerityandenhancingtheretailinvestment.Thecommonbric

andmortarban

sma

euseofelectronictoobtaintherivaldisputearrangedoveronlineban

sandalsotheconcepttodecreasetherateofgivingassistanceswhichwerereleasedinclusivelyoverpersonnelban

(2003,Josephetal.).Virtually,organizersandcompaniescomprehendtogivethefeatureuserassistanceanditistheimportantprocedureelementunderbusinessincome.Thesignificanceofassistancereleaseanditsscopetoenhancethefulfillmentandcustodyofusers,enhancingtheinterestsandretailinvests,andenhancingthealliedp


4/44

icturearenotexaggerated(1994,Lewisetal.).Li

emanyalternativeassistancegivers,theban

sdogoonrapidlytoadvanceinelectronicli

ethemethodoffunctioningtheratesandimpressmodernusersandobtainthefacilityandelectronicnoveltypossibilitiesoftheirabidingusers.Assistances,overdescription,areindefiniteandsimplycopied.Theyaresplitunderassistancesofhigh-techorhigh-touch.High-touchassistancesaremainlyrelyingonthepublicundertheassistancemethodtoformassistance.High-techassistancesareimportantdependingontheutilizationofautomatedforms,dataelectronicandalternate

indsofphysicalmeans.Nevertheless,onemustalways

nowthatevenhigh-touchcontainsthephysicalmeansandelectronic-basedformswhichshouldbefunctionedandmergedintotheassistancemethodundertheuser-orientedtrend(Gronroos,2001).Hence,underthisreview,theelectronicban

ingassistancecontainsbothhigh-touchandhigh-techassistances.Forinstance,high-techassistancecontainsShortMessagingService/Internet/Telephone(SMS)andATMdevices.High-touchassistanceincludesguidanceandpersonnelservicestoutilizetheassistances.Featureisdistinctandisrootfromthepossibilitiesofusers.Thus,itisimportanttorecognizeandplanoutthepossibilitiesforassistanceandcombiningthesepossibilitiesundertheformtoenhancetheassistancefeature.Executinganddeterminingassistancefeatureisveryimportantmethod.Thefeaturehasbeendescribedfromdistinctoutloo

sandintroductions,basedonthehumancreatingthedescription,thecalculationusedandtheframewor

underwhichitisaccomplished.Thishasbeenmentionedli

ethebestagreementneeds1995,watermanandPeters)benefitsofhealth(JuranandGryana,1988),value(Feig

nbaum,1995)andgettingand/orincreaseduserpossibilities(Parasuramanetal.,1988).Sometime,theusersrequestfeaturesfaceandtheiroutcomeattitudeiscopiedintheformofbehaviouragainstconsumptionattitudethatresultedtheresearchersandidentifiertothefeatureli everyessentialdeterminationforunendingformofsurvivalandaccomplishment.Featureundertheassistancefunctionisbasicallymadeatthetimeoffact(1989,Carlzon)and(2001)Gronroosimpliesitli

ethetimeofchancewherevalueisincludedtoobtaintheassistancefeature.Nevertheless,assoontheuserleaves,thenewtimeoffactshouldbemadeli

etheassistancerecovery(1990,Hartetal.)toma

ethecorrectionpriortheissueformed.(1993)Vandermerwemovesaheadtosayunderassistances,providingandthewor

ersarenotseparated.Ban

sincludegreatimplementationassistancereleaseelectronicli

ethemethodofimprovingtheassistances,whichiscommonlygivenbyban

personnel.Execut

ionoutcomesbothbasedontherequirementtodecreasetheratetoreleasetheassistancemainlybypersonnelandthecomplementshouldobtainthedisputearrangedbyelectronicchangerivalries(BoyersandLederer,2002).Modificationundertheban

ingcompanyli

etheoutputfromliberalism,quic

worldweb,andtheincreaseinownpropertyhavehencecreatedtheexecutionofdelicatereleasemethods(forinstanceban

ingonlineandtelephone,automaticwebsiteandremotetellerdevicesandsoon)theprocedureneedsunderseveralsituations(1994,Lewisetal.).Theissuewithelectronicunderassistancesisthatitistheabilitytocreatethetimeoffacttheautomatic

nowledge,deficiencyinfeeling.Fortheusertobefulfilled,eachshouldhavethechargetoassisttheuserinthemanagement.(1995)Berrydiscussestorivalfors

illunderwor

erstoarrangetheincreasedstandardsandtoremainonstandardsandthereforeParasuraman(2002)underlined

thesignificancetogettheaimandsynonymstowor

ersandwor

sandtostrengthenthemwithoutanyris

ofrevenge.Moreover,modifyingthemanagementmethodtoenergizethewor

erstoacceptthecorrectfirstmomentintellectualisimportant(2000,Oa

land).Therefore,thetrainingissignificantandevenitisexpensiveand

eenaccomplishmentandshouldprovideli

eitisabletoassisttoenhancethemethodorganizationandalsotogettherequirementsandpossibilities(2000,Oa

land).Electronicisabletoassistthepublictosatisfytheirneedsveryproductivelyandyettheindustryisyetthemerelyasbestasitswor

ers(2001,Gronroos).Theissueexiststorecognizethesinglepersonandinspirethedeterminationsand


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controllingtheminthecorrectpath.Itdoesnotbotherwhichassistancereleaseisutilizedandtheassistancegiver/assistancecostumerinteractionsshouldbedisciplinedateachrate.Manyusersmoveonlinetosatisfytheirassistancerequirementsandthemorerate-productionandscalablethefirmdesign(2003,Schultze).Thisorganizationamongassistancefeatureandfirmaccomplishmentdoesmovetheinterestine-assistance,onlineassistance,andwebmar

eting.Thisinvestmenthasbeenlaterenergizedovertheproofofless-assistancecharacterinafewframewor

s(Zeithaml,2002;Boyeretal.,2002).Zeithaml(2002)recognizestherequirementforfirmstotargetonthee-assistanceundertheire-firm,andtocomprehendthesignificanceofe-assistancefeatureli

ethedistinctprocedure.EvenfirmsshouldidentifythattheInternet

nowledgeshowsthetagtobeplaceononlineuseranditmightbesignificantcomponentundertheorganizationoffaithandinteractionswithusers(Zeithamletal.,2002,Yang,2001).TechnologyintheBan

ingIndustryWiththegrowthinthetechnologyElectronicgrowthshavedeletedtheduplicationandtimeta

enactionsanddecreasethemanmista

esandincreasedtheentrytoban

ingconvenience.Also,electronicgivesdatatotheuser,whichwillbeverycostlytogiveonthebasisofperson-to-person.Telephoneban

ingconveniencepermitsthenon-fundtransactionstobeta enplaceandthenwillneedtogotothebranchprior.Inthesameway,theInternetban

ingpermitstheuserstodotheactionsatamomentandundertheportion,whichissuitableforthem.(2002)Dabhol

arproposeswhichdirectlyinteractwithsuchelectronicalsoprovidestheusersli ethe

senseoflargeoperation.(2007)Smithisoftheview,whichelectronicwasorientedunderban

sbasicallytodecreasetherateandyetoverclassifyingfunctionsoffrontandbac

officeandtheelectronicfocusedtoincreasethedistinctoperations.Nevertheless,thethin ingyetremainsli etosustainthefulfillednumberofface-to-facecontactswiththeusers.(2004)Rogersrecognizedfivefeaturesorqualitiesofnovelty,whichinfluencethecostatwhichnoveltiesareaccepted(andfinallytheirusefulmethods):theirappropriatebenefit,affinity,interaction(observability),complexity,distinction(trialability).Moreover,thequalitieswerefurtherincludedandobtainedthethreatandeconomicalandsocialrate(2005,Zeithaml).Undertheclassificationofassistancesunderelectronic-basedassistancereleaseselectionsDabhol

ar(1994)proposesmanyparticulardivisions,whichwoulduseforthecompaniesforemployingtheelectronicbasedassistancerelease.Thed

ivisionrecognitionswhoreleasetheassistance,thatis,theperson-to-person,underwhichthewor

erma

esuseoftheelectronicorusertoelectronicli

eutilizationofanATM.Thesecondclassificationviewsontheassistancereleased.Ifatallthewebsitesofassistancebusinessthenatthehomeorofficeoftheuserorneutralwebsiteli

ethelocationofanATMavailableatanairport.Theultimateclassificationviewsattheinteractionoftheuserwiththeassistancefunctionfordirectorindirectli

eunderthesituationoftelephoneban

ing.(1994)Dabhol

arcontractsthattheremustbeadaptabilityunderthemodeloftheelectronictopermittheuserstocreatemodificationintheprocessofthetransactionandma

epresentfortheuserassistanceadviserwhenneeded,withdecreasedstay.Itevenincreasesthemodelproblemofenoughselectionsforwebban

ersandATM/Telephone.Undermanysituations,thetransactionhappensinastableplaceandthepresenceofthewor

erdonotalwaysbepossiblebecausethese

conveniencessometimefunctionperdayfor24hoursandsevendayswee

ly.Constantdevelopmentsunderthedataelectronicallowedtheban

stogivetheirassistancesunderadirectmethodtobesuitablefortheiritemsinagoodwayfortherequirementsofclienteles.Eventhough,ban

ingistheexperiencedfirmandthedatatechnologywasbasicallyutilizedtomonitortheadministrativemethods.Themovementfromcontrollingtoinformationbyma

inguseofdataanditssurgetointimatetheorganizerstogivethechanceto

nowtheattitudeoftheuserandreplyatthecorrectmoment.Thechasingformreferstothemethodoralternateformoftechnologicalban

ing:


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Theban

ingpersonalcomputer(PC),virtualban

ing,onlineban

ing,homeban

ing,andphoneban

ing,Internetban

ing,remoteelectronicban

ing.TheInternetoronlineban

ingandPCban

ingareverysometimeutilizedforlabel.Nevertheless,thismustbecited,thatthewordsutilizedtomentionthedistinct

indsoftechnologicalban

ingareutilizedcorrespondently(2003,Dir

deVilliers).Internetban

ingisassumedtorevolutionizeandchangethecommonban

ingcompany(Mols,2000).Ban

ingassistancesaresimplymechanicalanddigitalizedandhencebasedonfunctionaloutloo

,theylendthemselvestotheweb.Theabilityofrivalbenefitofthewebforban

soccursinthefieldsofdecreasedrateandfulfillmentofuserrequirements.AsperSiauetal.(2001),m-business(mobilebusiness)containsWAPandincludesafewofthequalitiesofmobilecommercethatcontainUbiquity.Mobilecommerceallowsthecustomertogetthepermissionforthedateandtheyareexpectingthecustomerunderpersonalization,thecellularbroadcastfield.Becauseoffewofthememoryabilityofthemobilehardware,thesoftwareallowsthegooddegreeofsolvinganddividingtogettherequirementsofmobilecostumers,adaptability.Themovementofthehardwareforinstancethecellularhandsetsallowsthecustomerstohavethetransactionsand/orgetthedatawhenthecustomerisbusyinalternatetas

li

efunctioningortravellingordissemination.AutomatedTellerMachines(ATMs)areevencalledastechnologycashdeviceandtheelectronicdeviceallowstheusertogetthepaperamountorgoingwithalternateban

ingtransactionsafterinserting(msn)theencodedplasticcard.Automatedtellermachines(ATMs)useofconvinceswhichATMsgive.

Thepresentban

ersareconcentratingonhowthecustomerswilltransactanditalsoshowstheirtraditionalban

sagainsttheironlinechallengers.AccordingtoFletcher sResearch"around200,000peopleintheUKarealreadyban

ingonlineandpredictedsevenmillionwouldbeby2002."AccordingtoVernon(1999)withtheInternettheban

ingbrandsshouldfacethecompetitorstoattracttheircustomers,whichwillbehardtofocusduetopressure."Bytheyear2005twobillionpeoplewillbeontheInternetrepresenting90%ofthebuyingpowerontheplanet."1.2ResearchObjectives:

Theresearchobjectivewillshowthepurposeofthisdissertation.Thefiveobjectivesareisasfollows:Toevaluatetheban

ingindustrywithITandSecuritysystems.

ToanalyzecustomerlevelsatisfactionbeforeandafterITimpactonban

ingindustryTounderstandhowtheITchangedtheban

ingindustrypresentandfuture.Toreviewthemajorchangesinban

ingindustrywitheffectofITandsecuritysystemsTodescribemajorchangesinHRwitheffectoftheITimpactparticularlyinban

ingindustry

1.3MethodologyAdopted:

ThemainaimofthisdissertationistostudytheITimpactandSecurityactivitieswhichareadoptedbybothprivateandpublicban

sectors.ThecountryconsideredinthestudywasIndia.Themainreasonbehindinselectingthiscountryi

sasithasmorenumberofban

sandverylargepopulationwhohasallgradesofassuredincomelevels.

1.4Collectionofdata:

Asmallsamplesurveywasconductedinthisstudyandrequiredprimarydatawasgatheredfromquestionnaire(annexure)whichcontainsthedata/informationabouttheITandSecurityactivitiesfollowedbyprivateandpublicsectorban

s.Italsohadtheinformationaboutthecustomersreceivedfacilities.Nowthesecondarydatawasgatheredfromnewspapers,magazines,Internet,journalsetc.


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1.5Sampleplan:

Sampleunit:Inthisdissertationsixban

swherethreewerenationalizedban

sthatarePunjabandSind(PSB),PunjabnationalBan

(PNB)andStateBan

ofIndia(SBI)whileICICIban

,Axisban

andHDFCban

asprivatesectorban

swererandomlyselected.Thisstudywasrestrictedtothestaffofprivateandpublicsectorban

sofIndia.

1.6Samplesize:

Samplesizesof10employeeswereselectedrandomlyfromeachban

.AstheCRMactivitiesareadoptedmainlybyban

semployeestosatisfy,retainandattractthecustomerstoma

ethemastheirlongtermcustomers.Butforthesubjectrelativeinterviewsonlyspecifiedinthedissertation.

1.7SamplingTechnique:

Asuitableandappropriatesamplingtechniquewasfollowedtoconductthestudy.Inthissamplingtechniqueparticipantsareselectedbasedontherequirement.Thetechniqueisli

ethewayofconductingtheinterviewandscrutinizingtheanswersbasedonfaithandfairanswersrelatedtoourstudy.

Assumethatwehaveinterviewednearabout15peopleandmostlyoutof15nearabout8peoplewillgiveirrelevantanswersandsomeanswersarenotrelatedtoourstudy.Butwecanta

eonlysomeanswerswhichwefeeltheanswersarerelatedtooursubjectanditshouldbehonest.1.8DataanalysisandInterpretation:

Theobtaineddataisclassifiedandsummarizedtoimprovetheirstrategyfromresult.Afterconductingquestionnairethedatacollectedfromtheparticipantswasorganizedbyfindingtheresponserate.Byusingthispercentagewasfoundedandsummarywasmade.

1.9Limitationsofthestudy:

Eventhoughspecialcarewasta

enwhileconductingthestudytherearesomelimitationstonoticewhichareexplainedonfollowing:

1. Inresearchprocesstimeisthemainconstrainttoconsiderhenceonlyfewban

swereselectedtodostudy.2. Theresultofthisstudywilldependonresponseoftheparticipants.Thereforetheselectedsamplemaybeormaynotbeconsideredastorepresentcompletepopulation.3. Asthisisanopencategorysurveytheremaybechancesthattheparticipantsmaygivetheiropinionspersonallytojustifytheirinterests.4. Fewquestionswerenotansweredbytheparticipantsduetolac

of

nowl

edgeandnot

nowingsomeconceptsinITandsecurityactivities.


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Chapter-22.0LiteratureReview:

Ban

ingindustryisoneofthebestcustomercentricindustryandwiththeimprovementintechnologyitleadtoamajorchangeinallitsoperationsasithasboughtasuddenincreaseincustomersatisfactionandcustomerloyalty,thatleadtotheincreaseinprofit.Earliertheretailban

ingwasfunctioninginapersonalizedstylethatisthecustomerhadtogototheban

todoanytransactionsandtheyalsohadtowaitfortheirturntodothetransactions.Four

eyformsoftechnologydominatedbusinesscultureintheban

ingindustry:JonesT.,199rrAnewtrendcultureinthenewEra.

(Ibid)

"Aban

collectsmoneyfromthosewhohaveittospareorwhoaresavingitoutoftheirincomesandlendsthismoneytothosewhorequireit"(Crowther,2006)

Earliereverythingintheban

swasstoredonpaperthatcustomerinformation,ledgerboo

s,receipts,accountinformationandinandoutmanagementofban

swasstoredinthepapers.Thentheintroductionofthefirstsoftwarethedatawar

ewasintroducedbytheinformationtechnologyandstoringtheinformationwaseasyandtheydidn tneedaroomtostorethedata.Thiswasthefirstimpactofinformationtechnologyonban

ingindustry.Thentheyintroducedtheplasticcardswhichhadacustomizedpersonalidentificationnumbercalledasthe"PINnumber"whichwouldbeallottedtoindividualcustomersspecificallydesignedforprivacyofthecustomer.WiththisplasticcardcalledtheDebitcardcustomerscangetinformationabouttheiraccountasavingoracurrentaccountfromtheAutomatedTellingMachinetheycandepositorwithdrawmoneywithinseconds(Saloner,G.andShepard,S.(2005),.

ThentheInternetinfluencedbusinessindustry.WiththeentryofInternettheban

ingindustrywastheone,whichbenefitedthemost.Customerswhotravelalotitwasbecomingdifficultforthemtotransact.Thenthesolutionthattheinf

ormationtechnologycameupwithistheonlineservice,whichwouldma

etheban

12available24hoursadayand7daysawee

.Customerisas

edtoonlinetoasecuredsiteinwhichheneedstoanswerthesecurityquestionsandthenthecustomergetshisusernameandpasswordforhisonlineban

ingaccount.Wherethecustomercantransacthiscurrentorsavingaccount,cantransferthemoneytoother saccountwithadifferentban

accountnumber,alsotheycandothetradingtheycansellandbuythesharesonline.Thecustomercaneventa

etheprintofhisaccountstatementallthiscanbedonefromanysystemorplace.

Thiswasappreciatedbythecustomersalotandtheban

too

allthenecessarystepstosatisfythecustomers.Thisisaconvenientprocesswherethecustomercanaccesshissavingaccountorcurrentaccountandtransferthemoneytoanotheraccoun

twithouteventravelling.Throughthisonlineandwirelessban

ingthecustomercanpayhisbillswithoutgoingtohisban

.ElectronicauthenticationandElectronicsignaturesban

sisusedforproperidentificationofthecustomer

sidentity(Tam,K.Y.(2008).Theseprocesseswouldincreasetheefficiencyofelectronictransaction.Securedonlineencryptionisasafeofdoingthetransactionswhenthecustomersareonline.Mobileban

ingisthecalescentareaintheban

ingindustryandverysoonitwouldbereplacingthecreditanddebitcardsystemsinthenearfuture.Mostoftheban

ingindustryaresendingthealertsthroughSMStotheircustomersitissafeandveryusefulnowadays.MagneticIn

CharacterRecognitionisatechnologymainlyusedbytheban

ingindustrytochec


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theprocessingofacheque.Thesecharactersareprintedwithmagneticin

toatoner.Securityisoneofthemostimportantfactorsforanyinformationtechnologybasedprocessingandwhichisverycritical.Manysecuritymeasuresshouldbeta

encareof.TovalidatethetransactionstheMa

erchec

erconcept,transmissionofelectronicmessagesoveranetwor

inencryptedform,dueauthenticationbymeansofprovidingdigitalsignaturesandstorageofelectronicrecordsinconformitywiththeprovisionsoftheITAct,2000andamendment2008."

Electronicfundstransferthecustomercouldbeabletotransferuptofivela

hstoanyban

inanycityorstateorcountrywiththisservice.Electronicbillpaymentthisservicewouldallowthecustomertopaythebillsfasterandwithmoreeasetheycanoperatethisserviceasthisisonethingacustomerwouldappreciateisnottogotodifferentplacestopaybillsbutatoneplacetheycanpayalltheirbillsthisservicewouldprovidethistothecustomer.Andtheban

ingindustrycancontactthecustomerswithanyupdatesoranynewschemesornewplansbysendingamessagetothecustomer

sphoneandcustomercanevengethismonthlyaccountstatementtohisemailwithinseconds.Centralizedban

ingcoreisaterminologyusedtodescribeaprocess,whichisprovided,byagroupofban

withisinnetwor

witheachother.Herethecustomercanaccesshisfundsfromanyofthebranch,whichisamemberofthenetwor ban ing.Theycandepositorwithdraworanyotherinformationthattheyneedtheycangetit.This

indofban

inghasbecomeinalmostallthestatesandcountrieswheretheban

sareundercorewithotherban

s.Astheretailban sintroducednewservicesforthecustomertheyhavealsomad

esurethatwhateverthecustomeras

edforisdone.Thecustomersintheinitialstageshadanotionthatsecuritywouldnotbetherewhentheyaretransactingthroughinternetbuttheretailban

inghasmadesurethatthesecurityofdatawouldbeatthetopandeverytransactionthatthecustomerwoulddowouldbeinasecurezoneandallthepasswordsandpinnumberwerealsoencrypted.Soitbecameeasyforthecustomertotransactwithoutanyfearonline.Theservicewhichisprovidedtothecustomersispersonalizedwhencomparedtothetraditionalban ingthenewtechnologicalwerecustomercentricandcanbeaccessedatanytimeandfromanyplace(Oliner,S.andSichel,D.(2000).Thesethingshavechangedthecustomer spsychologyaboutban

ingandretailban

ingbecomeeveneasiertothecustomers.

Earlierthecustomerhadtovisitthebranchforanyqueries.Butnowifweloo

attheusageofATMshaveincreasedtoahighextentwhichisaremar

ablebecauseofthefactthatinoldendaysinternetwasnowhereinpicturebutnowinthepresentcontexttheusageistentimesmorethanoldendays.

Thiswilldescribethedifferenttypesofnewtechnologiesortheelectronicmethods,whichareusingbythepresentban

s.Theretailban

sshouldfindandusethesetechnologicalinventionsforitsdistributionchannels.CombiningdifferenttechnologicalinnovationstogethertoformanElectronicban

ing,heretheElectronicban

ingisdevelopedduetotheelectronicdeliverychannelshencethenameisgivenaselectronicban

ing.Alltheservicesareelaboratedinvariousformsandalsointhepastyearsmanyfirmsandorganizationsareadoptingtheseservicesandcameto

nowabouttheimportanceofwor

ingtogether.Nowtheban

ingindustrieshaveseenthisserviceandthishadevolvedanewpictureinthe

irbusinessesastheworlditselfhasseenthegrowthintherecentyearsinthisnewtechnology.Thevariousformsofelectronicdeliverychannelsareexplained(Koza

,S.(2005).

ATMs(AutomatedTellerMachines)(Rose1999)thedefinitionofanATMis"anATMcombinesacomputerterminal,record-

eepingsystemandcashvaultinoneunit,permittingthecustomerstoentertheban

sboo

eepingsystemwithaplasticcardcontainingaPersonalIdentificationNumber(PIN)orbypunchingaspecialcodenumberintothecomputerterminallin

edtotheban

scomputerizedrecords24hoursaday".Oncetheygettheaccessitstartstooffertheservicesoft


10/44

heretailban

toitscustomers.Thesemachinescanbelocatedoutsidetheban

,inthemalls,airportsandinallthemajorlocationsinthecityapartfromtheirhomebranch.Themainreasonwhytheretailban

shaveintroducedthisserviceisforcashdispensing.ButlateronwiththeinnovationsintheinformationtechnologytheATMshavestartedtoprovidemanyotherservicesli

ethefundstransfer,billpayments,deposits,andministatement.Theretailban

shaveoptedforthisservicefromtheATMsbecauseithadacompetitiveadvantagewhencomparedtootherservices.WiththecombinationofboththeservicesthatisfromtheATMsandthehumantellersduringthepea

ban

inghoursitgavemoreproductivity.Asitsaveslotoftimeofthecustomerinsteadofstandinginthequeueintheban

theycandirectlywithdrawthemoneyfromtheATMastheycanutilizethistimeindoingsomethingelse.Fortheretailban

stheATMshaveprovenverycostefficientwhichgavehighproductivityinalessperiodoftimewhencomparedwiththehumantellers.OnanaverageahumantellercangiveservicetoaboutfourthousandthreehundredwhilecomparedwiththetransactionoftheATMitissixthousandfourhundredandifthehumantellersta

eabrea

inbetweenstilltheserviceiscontinuedbytheATMsduringandaftertheban

inghours.

2.1ITimpactslevelsontheBan

ingindustry:2.1.1PersonalComputer-Ban

ing:

PC-Ban ingisaservicewhichallowstheban scustomerstoaccessinformation

abouttheiraccountsviaaproprietarynetwor

,usuallywiththehelpofproprietarysoftwareinstalledontheirpersonalcomputer".Iftheconsumercaneasilyaccesshecanperformmanyfunctions,whichareprovidedbytheretailban

.Asthiswillalsoincreaseanawarenessandimportanceofcomputerliteracyamongthecustomersinturnitwillincreasetheusageofpersonalcomputers.ThiswilldefinitelysupportthegrowthofthePCban

ingservicewhichwillvirtuallyconnectsthebranchban

intothecustomer shouseortheoffice.12available24hoursadayand7daysawee .ThisinturnwouldbenefittheATMsandtheTelephoneban

ing(Rose,1999).

2.1.2TelephoneBan

ing:

"Telephoneban

ing(telephoneban

ing)canbeconsideredasaformofremoteor

virtualban

ing,whichisessentiallythedeliveryofbranchfinancialservicesviatelecommunicationdeviceswheretheban

customerscanperformretailban

ingtransactionsbydialingatouch-tonetelephoneormobilecommunicationunit,whichisconnectedtoanautomatedsystemoftheban

byutilizingAutomatedVoiceResponse(AVR)technology"(Balachandheretal,2001).

Teleban

inghasmanybenefitsforboththecustomersandtotheban

saccordingtoLeow(1999).Mainlyfor12customersitcangiveimprovedeasymethodstoaccesswhichisenhancedandthetimecanalsobesaved.Andaccordingtotheban

s perspectivetheseservicesrelatedtothetelephonearesubstantiallylowerthananyoftheirbranchservicesthatareprovidedbytheban

anditcostsverylesscomparedtoallthese.ItissimilartotheimpactthattheATMsproduceonlyexceptionisthatitcannotdispensethecashli

etheATMs.Theteleban

ing

deliverstheconduitthatgivesserviceevenaftertheban

officehours.Itincreasesthecontinualproductivityfortheretailban

.Theretailban

sofferitsservicestothecustomersattheirhomeortheofficessothatitcouldavoidtogoban

forany

indofneed,sothismethodmaysavetimeandcanalsoimprovetheproductivitybyprovidinggreaterconveniencetothecustomers.2.1.3InternetBan

ing:

AccordingtoEssinger(1999)theideaaboutInternetban

ingistoprovidecustomersaccesstotheirban

accountsviaawebsiteandtoenablethemtoenactcertaintransactionsontheiraccount,givencompliancewithstringentsecurityche


11/44

c

s".AccordingtotheFederalReserveBoardofChicago sOfficeoftheComptrolleroftheCurrency(OCC)InternetBan

ingHandboo

(2001),InternetBan

ingcanbedescribedas"theprovisionoftraditional(ban

ing)servicesovertheinternet.

Internetban

ingoffersmoreflexibilityandconveniencetoitscustomerswhomcombinedwithavirtuallyabsolutecontrolovertheirban

ing.Servicedeliverygivestheinformationtothecustomeraboutthenewban

productsandmanymoreservicesalsoaboutthetransactionsthatarebeingconductedbytheretailban

s.

Analternativedeliverychannelfortheretailban

sisthatitcanreachthecustomersbyPC-Ban

ingandTeleban

ing,whichwillimprovetheproductivity.Alongwiththeimprovementsinthehugeproductivityitcanalsohaveanadvantagethatthedistancehurdlesandtimeareeliminated.Theretailban

ingwillcontinueitsproductivitywithunexpectedchancesofban

ingtothecustomers.ElectronicFundTransferProcesswillbeveryusefultothecustomersthattheycantransfermoneyfromtheiraccountintomerchandiseaccountforbuyingproductsatthepurchasingplaceitselfusingonlinetransactionwhichiscalledElectronicFundsTransferatPointofSale(EETPoS).APointofSalewillusethesmartcardli edebitorcreditcardthefundscanbetransferredbyactivatingthefacilityElectronicFundTransferProcess.

Duetotheincreaseintheproductivityoftheban

hasresultedintheuseofEETPoSwhichhelpsthecustomertopayforthepurchasingduringshoppingbyavoi

dinggivingcashtothemandalsocanbeusefulinsteadofusingchequeorwithdrawalsfortheshopping.Thisservicecanwor

evenafterthewor

inghoursoftheban

s,andhencetheproductivityincreasesfortheban

sduringnon-ban

inghours.Thismainlysavesthecustomerenergyandprecioustimetogotheban sorsearchingnearbybranchestowithdrawmoneyoratleastsearchforATMssothismayleadtolossintheproductivityoftheban

s.2.1.4BranchNetwor

ing:

"Networ

ingofbranchesistheinter-connectingandcomputerizationofgeographicallyscatteredstandaloneban

branchesintooneunifiedsystemintheformofaWideAreaNetwor

(WAN)orEnterpriseNetwor

(EN)forcreatingandsharingofconsolidatedcustomerinformationorrecords.

Thustherewillbespeedrateinthetransactionsintheinter-branchwithoutthedistanceandtimethatareeliminated.Sotheproductivitytimeperiodwillalsoincrease.Sincetherearemorenumberofbranchesforaban

toserveitscustomersandunderoneban

therewillhugelaborwor

inginthebrancheswithagoaltoimprovetheproductivityineachandeverybranch.Thecustomershouldtraveltonearbybranchandspendmoretimetodoproductionactivities.Arethecustomersoftheban

todayaretheymoresatisfiedandbetterservedfromtheirban

swiththeinnovationsortheyarehappywitholdformatthathasahumanapproachtoitsservicesisthemainquestion.Thefactorsli

eavailabilityofinstanthelp,availabilityofserviceaftertheofficehours,convenience,accuracyandreliability,lowcostfortheusageareimportantfortheban

customers.

CustomersatisfactionisResult-Expectations"(Dunne,T.,Foster,L.,Haltiwang

er,J.andTros

e,K.(2000).Tomeasurethecustomersatisfactionthetoolsarecategorizedintothreelevelsofsatisfaction,whichbasedonthemodelofthreelevelsofsatisfactionby(Kano)

1.Desiredqualitytoolssurveysoncustomersatisfactionwhichisonlywayto

nowaboutthecustomerswhereastheperceptualsurveyshavetheviewsofthecompetitor

scustomers.2.Expectedqualitytoolstal

saboutthecomplaintsystem.3.Excitedqualitytoolsshowsthefocusgroupofthefutureinvents.Innovationsinthetechnologywhichareadoptedbythepresentban

ersaredivid


12/44

edintothreecategoriesasstatedby(Fisher,1998)

1.TransparentCustomerandcustomertechnologyshowsthecoreoftheoperationsinaban

.Thisisthetechnology,whichthecustomeronlyexpects.Ifthecustomerissatisfiedandthetechnologyreachestheirexpectationthentheywillremaincalm,otherwisetheconsumerwouldcontacttheban

quic

lytogivehisfeedbac

onthisorgivescomplain.Themainexamplewouldbeiftherewerenofacilitiestoseetheaccounttransactionsinstatement,thecustomerswillexpectfromtheban

seventhoughthetechnologyandtheban

processaretransparent.Forexampleletusseetheproblemofthestatementwasdelayedbyatechnicalreasonthecustomerwouldfeelangrythatthenormalstandardofserviceasexpectedhasnotbeenmet.

2.CustomerIndependentisatechnologywhichwouldinvolvethecustomer

sconductionandthetransactionswhicharecompletedwithintheban

ismainlyindependentofanyhumancontactwiththeban

li

etheinternetban

ing,phoneban

ingandtheATM swhichwouldnotrequireanyassistance.

3.Theban

employeewillassistacustomerandheusesthecustomertechnologytofinishthetransactionsli ethecustomerserviceinthecallcenterwouldusethecustomerrelationshipmanagementtounderthefilewherethecustomerdetailsarestoredinthecustomerprofileandthenthecustomersarecontactedandenquireontheirban

ingtransactionproblemsandalsoprovidethebillinguptodate.

AccordingtoSpiggleandSewell(1987)themodelformotivationfortheban

selectionisusedtoshowasanexampleforthecustomersatisfaction.

Theretailban

canbeattributedaccordingtoSpiggleandSewell smodelintothreetypes

1.Locationsfortheretailoutletsareatvariabledistancesandtraveltimeandassortment.

2.Consumerpsychologicalsatesli

etheperceptions,attitudes,attributeweightsandimagearedirectlyviewedasthepreferencesandshapingchoiceofpatronage.

3.Thecharacteristicsoftheconsumerli

ethelifestylesanddemographiccharacteristics.Thismodelofmotivationwasappliedforthequalitativeanalysisinthequestionnairesforthesurveyandtostudytheselectionreasonstothemodeofservicesgivenbytheban

toshowthecustomersatisfaction."CustomerSatisfactionandCustomerConnection"byColeandWayland(1997)

Doinformationtechnologicalinnovationsmeetthecustomerexpectationsintheretailban

ingindustry,AccordingtoColeandWayland(1997).Consideringthecustomer s

nowledgeandcustomer sconnectionwithtechnologyandta

ingthemasthebasicneedsforthecustomersconnectionstrategy.Itshowsthenewtechnologiesfoundandareusedtoma

etheonlineconnectionsforcustomerssuchasATM

s,self-servicesystems,Internetandthecallcenterforthecustomercaresystem.Accordingtothesesystemsthetechnologiesareincreasingthecapabilityofthestrategicsupportingchangesthroughtheimprovementsinthestrengthofcustomerstrengthbaseandalsoexplainthedifferentmethodsusedbythesevaluechainsandcorrelationsandpromotingthesecollaborationsinthecustomersandsuppliers.Thisreportwillhelpto

nowwhetherthecustomerconnectiontechnologywillbeusefultosatisfymaximuminthecustomerofretailban

ingandalsoincreasingpromotingcollaborationofthepotentialcustomerbaseandtheinterdependency,whichwasmentionedbyColeandWayland.


13/44

Fromtheresultsitisshowingthatcustomerconnectiontechnologyalwaysdoesntsatisfythecustomermaximum.AnyhowthecustomerconnectiontechnologiessuchasATMwillsatisfythecustomersinsomecaseswhencomparedwithotherservicesli

eInternetban

ingandphoneban

ing.AccordingtoSloanmanagementreview:findingtheoutrageandalsothecustomerdelight(BowenandSchneider,1999)whythecustomersarenotsatisfiedandwhytheyaresatisfied?Itmaybebecauseoftheban

technologicalservices,customerli

ings,ortheattributesorthecustomercharacteristics?Thereweremanystudiesdonebythemar

etingperspectivetounderstandthecustomer ssatisfactionbutpsychologicalexplanationsofthese

indsofbehaviorsarelittleexplored.Fromthisstudywecansee

theexplanationinourresearchfromthecustomer sperspectiveofhisinternalstate.Andtheretailban

shavetogivemanyattributesandservicesandcanseethewhetherthecustomersaresatisfied.AccordingtoSloanmanagementreview1999thereareonlytwomethodsofthoughts,whichwilldescribethevariousstagesofcustomersatisfaction.FromMetexpectationmethodwewillconcludethatbyreachingthecustomerexpectationcanleadtocustomersatisfaction.Ifwecrosstheirexpectationsthencanma

ecustomerdelight.Alwaystheexpectationlevelswillbeanincreasingoneanddynamic.Thepersonalexpectationsaremorethanthepersonalstatus,whicharealwaystoughtoestimate.TheNeedsBasedModelwillbehelpfultosatisfythecustomerinthreeaspectsofthecustomersuchassecurity,justiceandself-esteem.Thismodelwillexplainthattheneedsarefocusedonthecustomersphysiologicalbehaviorandtoreachtheirexpectationswillconcentrateonattributeb

utnotonthecustomer.

2.1.5TheDownsizingofBan

s:

Therearemanyfactors,whichinfluencetheban

sindownsizing.Asfinancialservicesectorsprefertoglobalizethebusinessfromthenationalleveltointernational,therehasbeenhugecompetitionintheinternationalfinancialservicesofcustomerawareness,availabilityandinformation.

Therearemanylevelsintheban

ingstructureli

eotherindustrieshave.Butitisverydifficulttofacethisnever-endingcompetitivemar

et.Thehigherlevelsofmanagementwillinteractwiththeprimarylinemanagerswiththehelpofavailabilityofthetechnologicalinformation.Thisisalsousefulwhilehorizon

talinformationtransferamongthedepartments.(JacquesM.,12June2004,p.10/8)thehorizontalinformationtransferisusedtodecreasethemiddlemanagementinthemanagementstructure.

2.1.6Theendofcrosssubsidy:

Manyban

shavebeenwor

ingonthesmallaccountholdersprices,whicharesubsidizedtogetmoreprofits.Thesearehighvaluetransactionswithlessvolumetosubsidiesthelowvaluetransactionswithlargevolumes.Sinceitista

enasapositiveaspectbutitmayleadtonegativeeffectsontheabilityoftheban

stocompetethemar

et.Anyhow"Ban

snowincreasinglyacceptthattheymustrecovertransactioncostsfromthosecustomersthatincurthem"(ChannonD.,1993,p146).ThemainreasonforthisstephasbeenobservedfromtheCustomersservic

erevenuematrix-ifthelossesareincreasingbymanyofthecustomers-itisimportantthattheservicesshouldincreasetotwentypercent,whichmayreturnlargeprofitstotheban

s.

Thelessrevenuema

ingcustomersshouldbarethetransactioncharges.Thereshouldbeastrategicreasonifthosecustomersarenotfollowingitli

ethestudentaccounts.Thismayaffectthecustomerstodotransactionswiththeban

oritmayalsodecreasetherevenuesfromtheprofitma

ingcustomersandmayhavemoreburdensonthem.Thisstepwillma

eto

eepthelargeincentivestoattractmanyoftheprofitablecustomersinthemar

et.HoweverEconomistVilfredoPare


14/44

to(1848-1923)arguedinhismodel"inorderformaximumwelfarepositiontobereachedthenthe"ophelimity"2ofsomeshouldnotincreasetothedetrimentofothers".(SlomanJ,2004,p.400)themainadvice,whichisgivenhere,isthattogetmoreprofitstheban

ingelementswithinitshouldnotaffecttheotherfactorsforsubsidy.ThispricingmethodhasbeenseenintheFirstChicagoBan

.ThispolicywasadoptedbytheCityban

tosomegroupofretailcustomersitattractedsomecustomersandremovedsomeuselesscustomers.

Iftherearesavingsinthepricedriversthatcannotbetransferredtothepricingpolicy,bythisnearlyeightypercentofnoprofitma

ingcustomerscanbeattracted.Thesavingsmadeshouldbeusedindecreasingthepricesandusethesesmallaccountsinreturnsofrevenueortoattractnewprofitma

ingcustomers.Fromthestudymadeintheyear1995-96revealsthattheremaybechancestodecreasetheinterestrateforthemediumandlowaccessaccountswhencomparedtothelongperiodaccounts.Eventhoughtheinterban

rateisfallingtheinterestgiventothe90daylargerandmediumbalancemaintainingaccountsareincreasinggradually.

2.1.7ThemoveawayfromtheBranchNetwor

:

Basicallythewholeban

operations,trainings,personnelandlendingarecompletelydependingontheban

branchmanager(SmithS.,WieldD.,1994,p.98)"intheorypromotionwasopentoanyoneTherelationshipbetweenInterban

rates,depositsandmortgagerates,whocoulddemonstratethenecessary aptitude and de

dication

"

Fromthepastfewyearsmaximumban

sarenotfollowingtheneedtofacilitatespecialservicestothecorporateandpersonnelcustomersbythenormalban ers.Ithasobservedthatthebranchmanagersarefeelingmoredifficulttoprovidesuchspecialservicestotheirhighrevenuema

ingclients.Thebranchmanagershouldfollowasbelow:

a. Increasingnon-ban

ingservicesforsalesman.b. Branchadministrationheaddecisions.c. Thecentralpointofreferenceforpersonalban

ing.

Itisalsoplanningtoperformsignificantmethodofwor

ingacorporateban

ing

function.Onemoreimportantpointistherethatitdoesnothavethesuitabledecisionma

inginlendingthelargerandmediumbalanceaccounts.Ithasconsideredasjust errandboy tosendashortmessage.Anyhowthemainthingtoberememberedisthatthebranchmanagerdoesnothavetheadvantagesinbothtrainingandexperiencesinceitmaybethetreatedpersonalthin

ing.Butanyhowithasbeenadvisedthatthemanagersare"lac

inginsomeaspectsofcreditevaluation"(ChannonD.,2003,p.210).

2.1.8HubandSatelliteBan

ing:

Hubbranchisthemaincenterofthesystemwherethecompleteaccountservicesareprovided.Itwillbetheplacewhereadministration,speciallendersandtrainingmanagersareneeded.TheprocessingofdatacanbepossibleinthesameHu

bbuildingorinadifferentdataprocessingarea(DP).Thewordprocessingandstandingordercler

saregenerallycentralized.ThisDPandHubwillsupportasatellitenetwor

oroffermanylimitedservicestothepersonalcustomerinthebranches."Manysatellitebrancheshavenomanagers"(SmithS.,Wield.D.,2004,p.102).Thismethodisverymuchuseful,asitisnotallowinginreplacingthede-layeringandoldgeneralmanagers."Thecareerstructurehasbecomehorizontallyandverticallyintegrated(ibid).Thislimitedtheopportunitiesincareerdevelopmentforthelabor.Themainreasonforthissituationisthatthetraditionalhierarchyhasbeenremovedandreplacedwiththeinsularlevels,whichwillnotmoveconstantly.


15/44

Thehubwillalsoservethecorporatebranchbutitdoesnotofferanyspecialservicestothebusinesscustomersli

ebyansweringsolely.Ithasbeenobservedinsomecasesthattheban

sarehavinglimitedsavingsandinsomecasesitfoundthatithaseffectingtheproductivity.Byreducingthebranchmanagersthesavingsobtainedareusedforappointingthenewclericalandotherstaffthatareinneedforban

processing(ibid.p.103).Astheflexibilityhasdecreasedandhencetherehasbeendecreaseintheproductivity.Inthehigherstagesofspecializationsmaybereasoninincreaseofthestaffcosts.Letusseeoneexamplethatin2004-2005Barclaysban

hasremoved3400or-3.7%ofstaff.Inthismeantimethestaffpricesareraisedquic

lyfrom2607to2728millionpoundsor4.6%ofincrease.Theclericalstaffcostsareraisedto2.75%(Bifu).Hubandsatelliteban

ingelementsarecommunicatedwitheachotherbyreliefstaffcover,informationsystem(electronicorpaper)andmanagingteamstoloo

overthenetwor

.Thereisaneedtoincreasethereliefstaffcoversincethereisaspecializationintheban

process.Itcanbeseenthattheban

ingsystemisintendingtoincludeTyaloristtheoryintheirmethodology.Thereisnecessitytoseetheinputsli

etheFordplants,whicharenotproofofban

ingnetwor

.Italsosaysthat:

Whilenewtechnology,businessprocessre-engineeringandthetotalqualitymovementmayhavecreatedmoreefficientcompanies,Efficiencyshouldnotbeconfusedwithcompetitiveness.Competitiveness,reliesoninnovation,andinnovationreliesonpeople(Don inR.,2005b,Londonpage12)

Whentheban

sarenotabletobecomecompetitiveandadvancedbytechnically,itmayleadtonon-productivity.Itmeans,whenthereisanyseverecrisisoccursthentherewillbenospecialistsandmanpowertocleartheproblems.Soitisadvisedtoalwaysloo

underlyingcauseforany

indofchangeandinnovationsintermsoftechnology.2.1.9Doestechnologygiveban

sacompetitiveadvantage?:

Tobecomecompetitiveadvantageitneedstodevelopasuitable,different,uniqueandimpossibletocopy.Sotechnologywillnotanswerthisquestion.Sustainabilitydemandsthatafirmscompetitiveadvantageresistserosionbycompetitorbehaviororindustryevolution(PorterM.,1985,p20)

M.Porteradvisedthattodecidewhethertechnologicalchangewillbecomecompetitiveadvantagecanbedonebyadoptingsomecriteria:

a. Iftechnologyisincreasingthentheban

productswillbecomeuniquehencemanysharescanbeexpectedinthenewmar

etby

eepingremainingthingsconstantandasithaspioneeringeffect.b. Thenewtechnologyshouldbemadesecureandprotectfromre-duplicatingbyotherssothatitcanbecomesustainablyadvantageous.c. Eventhoughifotherscancopythetechnologytheban

shoulduseitscompetitiveadvantageandincreaseitstrafficrate.

Pioneeringmayleadtoavarietyofpotentialfirst-moveradvantagesincostordifferentiationthatremainsafteritstechnologicalleadisgone(ibid.,p172)

FromM.Portersaysthatthenewtechnologieswillnotleadtotheproductivityoftheorganizationorfirm.Thesetechnologicalchangescanbeabletochangethestructureofthefirmeffectivelyormaybecomeworst.Byconsideringthispointitissuggestedthattechnologicalchangethatimprovesafirmscompetitiveadvantagemayworsenstructureasitisimitated.(ibid).


16/44

Thefiveforceswithinban

ing:

Itbecameveryevidentinsomecasesli

eNatWestsdevelopmentcaseofMondexandalsoforotherfirmsli

eNatWeststrategicallianceandTesco.Manyban

ingservicesli

ecashhandlingwhenemergencytoclearthecheque,travellerchequesarebeingstrategicallyreadytoreplacewithnewelementsbytheMondex,byintroducingnewtechnologiestheyhaveworsenthestructureoftheprocess.

2.1.10SecurityImpactonban

ingindustry:

Securityisalwaysanimportantaspectespeciallyinban

ingindustrywheretheris

ofbeinghac

edbysomehac

ersismoreli

elytohappensoban

ingindustryhaveemployedsometechniqueswhichassuresthecustomerstohaveasafeandsecureban

ing.Securityhasbringinamajorimpactontheban

ingindustryandinthetimelinetheresbeenamajordevelopmentsinthesecuritylevelonban

ingdifferentban

shaveemployeddifferentsecuritytechniquessowhichdemandsthecustomerstohaveastrongsecuritywithwhomtheyban

with.

2.1.11Securityandaccessibility:

Theban

amountcanbereturnedbac

bytheInternetusersmaybenotsufficient.TherearemanyproblemswiththecustomerstouseInternetban ingsincethey

feeldifficulttoaccesstoconnect.Itcannoticethattheproblemsraisedinnetwor

policingcannotbefinancialinstitutioncontrollingorownershipofspecificinstitution/individual.Themainaspecttobeseenissecuritymanyoftheban sarefacinghugethreatfromcomputerhac ings.

Recentevents-notablyoneyoungRussianhac

erspenetrationofCitiban

sowncomputersystem-showthatban

sfindithardenoughto

eeptheirproprietarynetwor

ssecure(TheEconomist,2005b,p.123)

ThesecurityforopenInternetsystemishighlyris

yfactorsfortheban

ingsystem.Ifanyworsethinghappenli

ehac

ingthentheInternetban

ingwillma

ethecustomerstoloseconfidence.Toovercomethisproblemmanyoftheban

ersareusingencryptionofthedata.Anyhowencryptingthedatamanynotprovidese

curityitcannotbecalledassecuritysystem.Ifthesystemistheftthenitdoesnotmeanthatthewholedatahasgonewithinthesystemssinceitaccountsonlyfor8%.ThenewtechnologymademodernsystemswherethecentralcomputersarereplacedwithPCsandfileservers.Anyhowthistypesavingdataisnotadvisabletherearemanychancesofloosingdatainthiswayofsaving.FromareportanalysisorganizedbyNationalconsumercouncilalongwithTheDepartmentoftradeandindustry,UKITSECandICLrevealedthat9from10areoperatingsecuritybranches(GarrettB,2007,p22).Toimprovethereliabilitythedataisdecentralizedintonetwor

.

Anyhowthesurveyreportsaysthat54%haslostthedata.Themaingoalofthemanagementsecurityisnotonlytoprotectfromthevirusesandhac

ersbutalsoitshouldma

eitclearandapproximate.Theauthorizedpeopleonlyshouldacces

sthedatainapracticalandusefulway.Itisnecessarytosatisfyboththemanagerialandcustomersrequirementsinsecurity.

2.1.12Consumers&EFT:

Thisexplainsthatthereistremendousincreaseinuseofelectronicdevicesli

eplasticcardsandATMs.FromtheAmericanBan

ersAssociationmanyofthecustomersarenotinterestedtota

ethepre-authorizedcredittransfermethodsli

e


17/44

payingthewagesandshowingreluctanceifpreauthorizeddebitsareta

enli

epayingbills.Bothareproportionaltoeachotherasincomeincreasesgraduallywhereasthereisdecreaseinpaymentsforthegoodsandservices.Itisadvisedthatthecustomersarenotreadilyta

eupconveniencewithoutanylimitationsandwillreactbyta

ingeconomicworthrationality(KingR.,2005,p43).ThenewtechnologicalinnovationsandATMsareprovidingveryeasywayofban

ingtothecustomers.

Itwillnotsaythattheoldsystemsarenotusefulorinsufficientandareinfinalstage.Thisnewinnovationswillma

ethebothcustomersandban

stoaccesseasilyandalsotoholdupdataeffectively.ButThemorecomplexthearchitectureofacomputersystemanditsassociatedsoftwarethemoreli

elyitistofail.(ibid.,p.47)

Ifanyofthesystemfailsthenitwillleadtoabigproblemasthecustomerswillloseconfidenceontheban

flexibilityandqualityofnetwor

.Ifcustomersaresatisfiedandcomfortwiththetechnologicalmethodsli

eATMthentheywillarrangesomewayban

ingavailablearoundthem.InsuchcasesifATMnetwor

goesdownthenittendtoabigpersonaltragedysincetheycommittopayments.

Thepreviousmethodsofban

ingli

emanualchequeclearingandaccountingarehavingmorechancesoferrorsthanthetodayATMs.Anyofwrongdeposithasoccurredthentheycanbeobservedbeforealldebitsareposted.Themodernban

ingsystemisverymuchflexiblethatclearingofchequescanbedoneautomaticallya

nditcanbedisplayedonthesystemmoreoveralltransactionscanalsobeseen.Suchastreamofpoorcreditsmaypropagatethroughthousandsofaccountsbeforeitisnoticed.(ibid.)

Ifthissituationisconsideredasanextremeonethenitmayleadtocreditblac

outanyhowitisnotsuggestedbutitcanbedone.2.1.13MondexFunction:

Eventhoughthecreditcards,chequesanddebitcardshasbeenintroducedtheycannotbereplacebypapermoney.ThenewchangeshavenotdominatedtheGlobalrequirementasprimarypaymentisbycash.Ifthepaymentsystemsaredonewithcashthenitwillgivesatisfactionandconfidenceinban

ingsystem.Mondexfunctionswillmatchwiththecashthatistransferredwidely;eventhoughitperfor

msspecialfunctionsitshouldbewidelyaccepted.BasicallycashitselfisthemainassetthananyotherthingwhereMondexisembossedinachipofplasticcardwor

susingareadingelectronicdevice.Themainwillallowtransferringmoneytoanypartoftheworldonlybymonetarycomputerortelephonebasis.Mondexisdifferentfromotherban

systemcardssincetheycanma

eonlyindividualcardtransactionsastheyhavedatabasemethod.

ThisrevealsthattheSupportingtheinfrastructurerequiredforsuchaprocessmeansmarginalcostpertransactionforsuchinitiativesisalwaysli

elytobeuneconomicforthelowestvaluetransactions,leadingtotheirexclusionorsubstantialcross-subsidization(JonesT.,2006).AnyhowMondexhasplannedanewmethodistotransferthemoneywithoutanythirdpartytoovercometheaboveproblem.

Buttherearesomeconnectionswiththeban

sincertainlevelsofprocessingintheMondexsystemoffunctioning.Anyhowthelevelofconnectionwiththeban

sdependsonthetypeoftransactionsdoing.IndividualtransactionsaredonedirectlyusingtheCustomerWallettransactions.Nowifthetransactionsarebetweentheretailerandcustomerthenthetransferringwillnotbedonedirectlyusingban

ingsystem,buttheprocesswillcontinueperiodicallytransferredtotheban

throughthetelephonenetwor

fromtheretailerterminalPointofScale(POS).


18/44

JamesEssingerwroteaboutMondexinhisboo

asElectronicPaymentSystems-WinningNewCustomers(2002),haveahugeimpactontheentireretailandfinancialservicesbusiness(Bifu2004,p7).ByusingtheMondexsecuredsystemofmoneytransferusingtelephoneshasreducedthedifficultyandris

ofcountingandtransportingofcash.Hencethiswilldecreasetheemployeesofthecashierandsecurityinthefinancialandban

ingsystems.Mondexprovidesafacilitythattheforeigncurrencycanbetransferrableintofivecurrenciessimultaneouslyinthegloballevelusingthetelephonenetwor

systems.ThustheincreaseduseofMondexwillreducethetravellerschequesandalsotheBan

ersUnioncantransferthecashtoforeigncountrieswithoutusingtheban

ingprocess(ibid.).ThusbyusingtheMondexmethodwillincreasethehomeban

ingprocess.

Thiselectronicmethodoftransferringandpaymentswillma

etodecreaseinjobsofcashierandchequeclearanceintheban

sduetolessuseofpaperintheban

ingprocess.OnethingshouldbenoticethatthisMondexiserodingtheBan

ingsystemslowly.AnyhowthisstatementwasrefusedinatelephonecallmadebyNinaHumphriestoMondexinternational.Sheadvisedthattheban

ingprocessstillcontinueandthecommunicationcanbeseenintheban

sandcards.Butshecannotexplainthemainreasonbehindthecommunicationbetweenthemtooccur.IftheMondexWallethaspurchasedinthelargerextentthenthepresentATMscanbeeasilyreplacedwithdirecttransferring.ThepurchasedWalletcanbeusedtochec

balance,deposit,transfercashfromortootherindividualcardsandwithdrawmoney(Mondex,2004,pp.10-2).Hencebyusingtheterminalinterconnectionoftheban ingnetwor theemployersareabletopaythereemployeeswithchargin

goftheMondexcards,thereisnothingtostopthisprocess.Sincethissystemisadoptedasapaymentsystem.Itdependsontheretaileranditswor

ersembossingonthecards.

Thequestionherearisesisthatwillthepeoplearereadytopayforthistechnologysincewehavefreesystemofpaymentasdirectcashexchangeofcash.Apartfromthesetransferringchargestherewillbeadditionprofitforthesecurityforexchangingthecash.Itcanattractthenewcustomersbyimprovingthenewfunctionalities.Anyhowtheprofitscannotbeabletoweighthecostsinsmalltransactionssuchasnewspapersalesmenandsmallstreetsellersarenotabletodohightransactions.

MondexusesinSwindon Units

Mondexcardholder 10,000Retailersandserviceproviders 700Payphones 200Screenphones 2,000ATM sadaptedforMondex 20Carpar

s 6Buses 80

[BasedoninformationsuppliedbyMONDEX]

NatWestandMidlandareestimatingthatMondexwillreplacethese20%cashtransactioninUKwithin20-30years(Bifu,2004,p.8).Thisalsoadvisesthattheef

fectofMondexontheemploymentlevelsandban

ingsystemmaynotestimateupto20years.Inthemeanwhiletheban

ingsystemwillcompletelybecomeworstinthemar

etandleadtodisfunctionality.Itwillalsoshowgreaterimpactonthebasicfunctionsoftheban

ing.HenceNatWestandMidlandareplanningtointroducenewtechnologicalofferstothecustomerstobecomecompetitiveadvantageinthemar

etbysmartcardoffer.Apartfromtheban

sotherfinancialsystemsaretryingtoinnovativenewpaymentsystemli

eprovidingelectronicsmartcardstodopayments.Duetothesenewmethodsofpayments,increasingcompetitiontheemploymentlevelsaredecreasingithaseffectingcompletelyintheban

ingindustry.


19/44

....Historyandexperienceshowsthatwhenprofitsareunderthreat,WORKERSARETOO.(ibid.,p.9)

Expertsareadvisingthatthemar

etsharewillfalltremendouslyinthecreditcardmar

etpositionasexplainedinCompetitionbetweenStoreandBan

creditcards,page31.Therearechancestobecomesuccessinthisnewmar

et.Anyhowiftheyarenotsuccessfulinelectroniccashmar

etsystemthenhavebarepenaltyfromtheban

ingandretailban

ingsystem.Ittellsthattheban

isdealingwithhugeinvestmentsandris

s.Itnotonlydealswiththeban

ingprocesstobesuccessfulinthemar

etwithcompetitiveadvantageousmethodsbutalsotoremaininthemar

etevenifthereareany

indofchangesoccurintheban

mar

etenvironment.2.2.TheimpactsofITandSecuritysystemsonban

ingindustry:

2.2.1Enhancingprofitability:

Itwillnotbesatisfactorytoprovidetheconsumerwiththedesiredproduct.Ifanyfinancialinstitutionintendstostandbeforethecompetitionitshouldconcentrateontheprofitability.Financialinstitutionshouldfindthemoreprofitablefields.Theyshouldinventthedifferentmethodstoselltheproductacrossmoreefficiently.Itiseasytohavethebigshareofthemar

etashighproductacutenessisthere.Additionallythesellingofmoregoodsma estheprofitsg

ohigh.

Withthecloserelationshipofthebuyer-sellerprofitabilityrises.Whenprofitabilityofanyorganizationincreasesshareinthemar etwillbemore.Toma esomedecisionsinsales,mar

etingandservicesban

sneedsbusinessintelligence.Ban

sshouldincludethehightechnologiestoma

ethewor

faster.Thishelpstofragmentthedataquic

lyandovercomethetechnologicalhurdles.

Differentdataofcustomersaresavedatmanyplaces.Thisdatacanbeaccessiblewithsomeways.Withthevariationsintheindustrybuildorwithanymergerandacquisitiontheinformationcanalsobedistributedtolessadministrativearea.

Awell-managedCRMsolutionthatwor

swithdifferentapplicationscaninitiatethecompilationandanalysisofdata.Thissystemisoperatedwithlotofbusinesspartnersandsupplierswhichfacilitatethedatacompilationthatstrengthenfinancialinstitutionsalesforce.2.2.2Operationalexcellence:

Alltheban

smustbringtogetheritssalesandservices.Itshouldusethevariouschannelswhichfacilitatestheportalsfortheconsumersandwor

ers.Fromdirectmeetingtoindirectonlinemeeting,theyshouldavailableoneachpossiblewaysofinteraction.AhighlyefficientCRMsolutionshouldwor

withallthemodesofcommunications.Itincludesfax,email,onlineportals,wirelessdeviceandinteractionwithban

employees.Thisgivesainteractionbetweentouchpointstoanwor

bayandlin

edthewor

baytotheallthebusinesspartners.Thisserviceenablestheban

personnelonanyconsumer simportantevents.Theseshouldbereadytota

eappropriateactions.

Eachpersonnelarehavingtheproper

nowledgeands

illstoachievethedesiredgoalsoftheorganization.Theyhavealls

illsetstodeliverwithhighquality.Whatisrelationshipofthecustomerwiththeindustry?TheeffectiveCustomerRelationshipManagement(CRM)systemshouldbeabletoanalyzethis.Itshouldprovidethedatatoseetheconsumerstabilityintherelationship.


20/44

2.2.3Benefitsforthecustomers:Whentheconsumerprovidedwitheasyaccesstothevariousproductsandservicestheyfeelblessed.Thewaytoreachtheconsumershouldbewellplannedandprofessional.Industrycandesignbetter-personalizedservicesifthedataoftheconsumerisupdated.Quic

actiontoanyissuesfacedbythem.2.2.4Benefitstotheemployees:Theywillgetenoughtimetofocusonthecustomerdemandsandorders.Allthepersonnelarestrengtheningwiththeideatoprovidethegoodqualityservicesandtofulfilltheordersastheyhaveas

edfor.Rateofsatisfactionwillbehigh.Thetop-levelpersonnelarestrengthenwiththedatawhichiseffectiveinbuildingcustomerrelationshipandma

ethema

ingquic

.

2.2.5.Benefitsforban

s:Therewillbeanidealutilizationoftheresources.Theindividualizedservicesprovidetheconsumerfaithandlevelofsatisfaction.Therewillbebetterconsumeracquirement,holdandsaleacross.Thegoodwilloftheindustryshouldgetimprovedintheconsumers minds.2.2.6CRMchallenges:

ThoughCRMisthecompletepac

agewhichcontainsallthestrategiesofma

ingprofitsbutstilltherearesomeloopholes.OneofthemainissueswhichCRMsyst

emisfacingistonotmeetingtheexpectationofreducingtheconsumerretention.ThisisthereasonfortheCRMdownfall.WhatisCRMfailure?Whatisthereasonforit?ThemajorreasonisthattheentireorganizationsthatareusingCRMarenotawareofitsfeatures.Theyarefacingalotofconfusionsaboutitscharacteristics.Therearemanyindustrieswhogiveitadefinitionofbusinessstrategiesandotherstellsitispertainingtotechnology.ThereisverylesspercentageoftheindustrieswhicharesuccessfulaftertheinstallationoftheCRM.Itlostitsinterestasitwasnotabletomeetexpectations.Therearenearly755oftheprojectswhicharefacingthenumberoftheproblemsafterinstallingCRM.MostoftheprojectfailstogetthedesiredresultsduetothevariousissuesexistsintheCRM.Howevertheexacttheratingiffailureisjust5%.Mainlythebigindustriesarefailed.Mediumsizeorganizationhasahighrateofsuccess.

2.2.7.ExorbitantCosts:

CRMrequiresthelargeinvestmenttomanageitscustomerdatabase.Thishugeinvestmentconsidersbeingabigproblem.Therearesomeotherexpensesalsoli

emaintenanceofthecomputerhardware,softwareandpersonneletc.Theadditionalcostsaresohighandnumberofexpensesisthere.MostlythecostsinvolvedarefailstocoverthereturnoninvestmentfromtheCRMimplementation.ThisleavestheCRMuserwithbadexperience.ThisiswhatwecallaCRMsuccessandultimatelyCRMfailure.

2.2.8InadequateFocusonObjectives:

Thesecondthingwhichneedstobeta

eninthemindisthattheaimsandobject

ivesshouldbeclear.Wholemanagementandemployeesshouldbewellawareoftheseobjectives,sothattheycanwor

towardsthegoalwithoutanyconfusion.Alltheobjectivesshouldbeclearlydefinedandwellplanned.HowevermainlywhentheCRMisgoingtobeimplementedandsuddenlyhardtimehits,Industrylostitsfocusonthegoals,whichultimatelyvanishes.Sometimesgoalsgetschangedandlosttheirvalue.Inthattimecompaniesta

entowardsgoalswhichareimportantandignorestheonewhichareoflessimportance.ThisisthemainissuewhichisfacedbymanycompanieswhileusingCRM.2.3ConclusionofLiteraturereview:


21/44

Asintheban

ingindustrythecompetitionsisgettingintensifieddaybydayandthecustomer sexpectationarealsoincreasing,acquisitionsandmergersandthemainreasontheglobalizationandderegulationandtechnologicalinnovationsareincreasinghavechangedthescenarioofretailban

ingindustry.Whichisthecustomerspreferredfacility?Isthecustomerhappywiththefacilitiesprovidingbytheban

suchasATMs,phoneban

ing,internetban

ingandsmartcardsortheyareinterestedwiththeoldpatternofban

ingstylewhichhasthehumantouchinit?

Thisresearchwouldmainlyfocusabouttheretailban

ingindustry,andtellsthecustomersintensioninacceptingtheirservicesfromtheretailban

sdotheystillhavequalityintheirservicesanddotheyli

ethisnewinformationtechnologyadvancementswhichareimplementedbytheseretailban

s.Thechangesinthetechnologicalfield,whichpavedwayforgreatercustomerexpectations,thecompetitionwasintensifiedli

etheacquisitionsandmergers,globalizationandderegulationhavechangedalltherulesoftheretailban

ingindustry.Thesurveyisacombinationofquestionnairesandinterviewstochec

oridentifytheexpectationsofthecustomertotheservicesprovidedbytheretailban

s.Comparingcanchec thecustomerssatisfactionthetraditionalservicesprovidedbytheban

tothenewandimprovisedserviceswithtechnologicalinnovationsintheservicesli

etheInternetban

ing,Phoneban

ingandATMs.Bychec

ingthelevelsinwhichthecustomerscomparedtothetraditionalstyleofban

inghaveusedtheservices.Whatarethemainfactorsthecustomerfocuseswhenheischoosing

aserviceintheirban

?Thesurveys,whichweredoneinIndiaandinUK,trytoassessthecustomers behavior.AndtheresultsshowthatmostfrequentlyusedserviceistheATMinboththecountries.Buttheolderandwithlowereducationagegroupchosetheban tellersasithadthehumantouchinit.


22/44

Chapter-33.1ResearchMethodology:Togathertheinformationthesurveymethodshouldbeused.Toshowtheimpactofinformationtechnologyandsecuritysystemonthecustomersofban

ingindustry,chec

ingalltheinformationthattheyhavecollecteddoesDataanalysisused.Surveysorquestionnairesshouldbepreparedtochec

ifthecustomersaresatisfiedbytheservicesprovidedbythem.Alsota

easurveyoftheban

ingofficialsforideasorchangingforthebettermentoftheretailban

ingindustry.

Alsochec

ingthecurrenttrendsofthemar

etandiftheyneededhavetodoaresearchonthismethodandwor

onit.Thisisasimplebutamoreconcisedatatoshowhowtheimpactofinformationtechnologyhashelpedtheretailban

ingindustrychangeforbetterdevelopmentwhilealso

eepinginmindtherequirementsandqueriesofthecustomersandgettingitresolvedbyoptingforthisimplementationoftechnology.

Asurveyshouldbedoneamongtheban

employeestochec

ifthecustomerwasabletoadapttothenewtechnologyorweretheyhappywiththeoldsystemthepersonalizedban ing.Themainthereasonwasthecustomerstrustfactorwhentheydothetransactiononlinetheyalwaysthin

aboutthesitewhichtheyuseissaveornot.Questionnairesshouldbegiventocustomerstochec

iftheyaresatisfiedwithservicesprovidedbytheretailban

andhoweasilycouldtheyadapttothechangeinstyleandadaptationinthetechnology.

3.2PrimaryResearch:

Theresearchhastwomainresearchfactorswhichhasbeenutilizedtheyarequalitativeandquantitativeresearchstyles.Thetraditionalformatofresearchiscalledthequantitativeresearchandthequalitativeresearchstyleiscalledastheinterpretersresearchstyle.Thedissertationhasboththeresearchstyles.

3.2.1QuantitativeResearch:

Questionnairesaregiventothecustomerstochec

theirviewsonthenewimplementationsintheretailsban

.Howtheinformationtechnologyhaschangedtheirviewaboutretailban

ingtheserviceswhichwereintroducedtothemdidtheyli

ethem.Thisanalysishelpstoassessthesatisfactionofthecustomersandsho

wsthereasonsbehindtheirlevelsofsatisfaction.Herebasicallyitshowsthereasonsbehindtheirlevelsofsatisfactioninusingthenewtechnologiesandsecuritiesintroducedbytheban

.

3.2.2QualitativeResearch:

Thisresearchismainlybasedontheinterviewswhichhavebeenconductedtounderstandthesatisfactionofthecustomerinabetterway.Themethodinwhichtheinterviewwasconductedwastheyhadaquestionnairethatwouldas

fewbasicquestionsandratingthemwhentheywereas

edtothecustomers.

Theusageofboththeseresearchfactorsshoedamoreclearunderstandingoftheaimsandobjectivesofthestudy.

Themainreasonforthissurveyistoanalyzeintheban

ingindustrywhataffectstheinformationtechnologyandsecuritysystemsonthecustomerssatisfaction.asurveywasconductedonthepeoplebasedonthequestionnaireta

enfromHills(1996)customersatisfactionmeasurementsboo

.ThisrequiredinformationisadoptedfromWoodruff,Donnelly(1992),Oliver(1997),Cardinal(1999),Johnson(1998)andotheravailableliteratureinthelibrariesandfromInternet.

Bydividingvarioustypesofcustomersintogroupsbasedoneducationallevelandageandconductedquestionnaire.Thissurveywillmainlyfocusonthecustomer


23/44

satisfactionandtheiropinionsintheretailban

ingservicesofferedfromthefollowingmethods:Internetban

ing,phoneban

ing,ATMs,Ban

Tellers.

3.2.3Preparationofquestionnaire:

Themainuseofthissurveyistoseethecustomersvaluablefeedbac

ontheservicesprovidedbytheban

ersandcomparingthemwithsatisfiedlevel.Theservicesareofferedtothecustomersbytheretailban

ersbyutilizingtheoldcultureofserviceratherthanthenewinformationtechnologyinnovationsservicesprovidedtothecustomers.Inthequestionnairethereare10issueswheretheretailcustomerswillfindwhentheyusetheservicesprovidedbytheretailban

s.

Thecustomersarerequestedtoratetheissueswhichofthemwererelevanttothemornotwhichwereprovidedbytheban

shumantellersagainsttheautomatictellermachines,callcentertointernetban

ingandphoneban

ing.Andthedatawhichisdetailedshowstheimportanceofthecriteriawhichisusedbythecustomerstomeasuretheirsatisfieddegreeswhiletheyareusingthefacilitiesoftheretailban

s,andtheassociationofthequestionsisseeninthegivenexample:iftheconsumersratestheavailabilityofawiderangeofinnovativeservicesandhightechserviceswhichisanimportantissuefromalloftheminordertoselectaban

andtheyalsoacceptthattheinternetban

ingisthehightechandinnovativeservices,hencefromthesurveywecanconcludethatthecustomersaresatisfiedbyusingtheinternetban ingfacility.Thisinterviewingprocess

isheldonlyontherandomlyselectedsampleofpeople,themaximuminterviewswillheldintherailwaystations,premisesofban

sandshoppingcenters.Ifthecustomersareabovetheageof18caneasilyaccesstheretailban

ingandcandotransactingwiththeban sareeligibleforthis.Thequestionnairesaremainlyfilledinfromtheinformationwhichhasbeencollectedfromthecustomerswhichwillreducetheproblemsofinappropriatereasonfromtheban

sandreplyfromcomplaints.Someofthiswasansweredthroughemails.Beforeplungeintothesurvey,therewereinterviewsthatwereconductedon10participantsfromdifferenteducationallevelsofdifferentagegroupstogatherthefeedbac

onthequestionnairesonatrialbases.Themainreportfindingsandotherfactorsanditseffectsareexplainedhere.Dotheban

customersusingtheban

tellersandusinghowfrequentlythesefacilitiesratherthanInternetban

ing,ATMs,phoneban

ingandotherservices?Whicharethecustomersban

inghabits?Fromthissurv

eyreportwecanfindhowoftentheseATMsareusedinIndiaandUK.NowthesecondgoestotheHumanteller sservicewhichisprovidedbytheretailban

inboththecountries.Whentheanalysismadeonthevaryingpeopleinagegroupsandeducationallevelsinboththecountriesareasfollows:(Table1).3.2.4AdministrationofQuestionnaire:

Theusageoftheban

ingserviceswilldifferfrommanygroupsofpeopleli

eeducationallevelsandageoftheretailban

customers.Inboththecountriesmaximumeducatedgrouppeopleprefertousehumantellers.WhenitcomestotheagefactortherearechancesofusingtheinformationtechnologicalinnovationswhichmaybeATMsforagedpeopleratherthantousehumantellerservices(Table2).

But45-55groupcustomerswillprefertousethehumanoperatorservicesprovidedbytheretailban

sratherthanusingthetechnologyinnovationsli

eATMs?

1.Whichfacilityprovidedbytheban

ingismoresatisfiedthecustomersorwhichmodeofserviceisusedfrequently?

2.Dothecustomersoftheretailban

saresatisfiedmorewiththehumantellerswhichisprovidedbytheretailban

sorthetechnologyinnovationsincludingInternetban

ing,phoneban

ingorATMmachinessatisfythecustomermaximum?


24/44

Normallyintheservicesprovidedfromtheretailban

sarethe"automatictellermachine","humantellers/operators","phoneban

ingwithoutoperatorassistance",phoneban

ingwiththeoperatorassistance"and"internetban

ing"inIndiaandUK,andthiswillexplainthatthemoresatisfiedservicesprovidedtothecustomersarebytheATMmachines.

Themostimportantservicedimensionwhichisli

edbythecustomersisfromtheATMwhicharesuingtheservicesofATMisthatitisavailableevenaftertheofficehourswhencomparedtothehumantellersserviceswheretheserviceisgiventothemonlyintheofficehours.SimilarlytheInternetban

ingandphoneban

ingisservicedequaltotheATMsafterofficehoursitisavailable.

3.2.5Survey:

Thechoiceoftheban

tellersisutilizedmoretoma

eBan

transactionsinIndiasuchastoapplyforanyloanortota

etheban

statementsandpayingthebills.

TABLE1ResultsfromSurvey(Question6)

________________________________________

Human ATMPhoneInternet Ban ing

Ban

ing________________________________________

IndiaAppofLoan 92/100 11/100 16/100 42/100Updatea/c 96/100 82/100 62/100 65/100BillPayment 99/100 83/100 45/100 79/100

UKAppofloan 86/10015/10018/100 66/100Updatea/c 83/10094/10078/100 73/100Billpayment 43/10093/10036/100 71/100

HoweverinUKthemaximumban

customerswillchoosetheATMfacilitymoreovertheban

operatorservices.

Whichmodeofserviceisleastsatisfied?

InUKtheban

customersarenotsatisfiedwiththeservicesprovidedbytheretailban

sli

ephoneban

ingfewtimesitgoesfortheInternetservicealso.HoweverincomparisontoUKtheInternetban

ingislowinIndia.

Whichdimensionofserviceisperceivedasimportant?

Wehavelistedintencriteriainthequestionnairethatcustomerswillthin

aboutitonlyafterusingtheban

services.Theyarea.Convenienceortheconvenientlocationsb.Courteouscustomerserviceofficersorthehumantellersc.Servicethatisavailableaftertheofficehoursd.Theban

ingservicesminimumta

ingtime.e.Easeofusef.Minimalprocessingortransactiontimebyamachineorateller.g.Hightechinnovativeservicesoffered.h.Noextracost.


25/44

i.Instanthelporassistancej.Reliableaccurateservices.Accordingtotheresultsofthesurveythetwocountriesretailcustomersareran

edas"convenienceconvenientlocation"willbethebestban

serviceoffered.Eachandeverycustomerwhotoo

thesurveyinboththecountrieshavechosen"reliableaccurateservices"asthesecondbestban

serviceasthesecondbestban

service.

Andmaythin

aboutthefacilityofhightechservicesoffered,thereportshowsthatthehightechinnovativeservicesofferedisran

edleastandgivenlowimportance.Dothetechnologicalservicesprovidebytheretailban

erssuchasATMs,Internetban

ingandphoneban

ingaregivenimportance?Thetechnologyinnovationsareran

edbitlowerimportanceandstillmorethan80%ofthesurveycustomersoftwocountriesareshowinginteresttopreferthesetechnologicalservicesratherthanban

tellersor(operators).Andabove90%ofcustomerspreferfornewban

ingserviceswiththetechnologyinnovations.

TABLE2

SurveyQuestion8-Overall,doyoupreferinteractingwiththeBan

ingtechnologicalservicesoverhumantellers?________________________________________

FindingsINDIAUK________________________________________

YES 132 81No 18 19 88% 81%

________________________________________

TABLE3

SurveyQuestion10-Doyouloo

forwardtomoretechnologicalInnovativeban

ingservices?________________________________________

FindingsINDIAUK________________________________________

Yes 134 85 No 16 15 85%86%

________________________________________

Docustomersperceivecost?Ban

customersinIndiaandUKperceiveextracostthatisassociatedwiththes

ervicesprovideddifferentlyintheban

.Thesurveycustomersran

edextracostasimportantasreliableaccurateservices

Whytheban

customerspreferringtheHumantelleroroperator?Whentheban

ingcustomersareusingtheban

servicesli

ehumanoperatorcanhaveanadvantageofany

indofhelponthespotitselfandalsohavebetterservice.WhytheInternetandphoneban

ingdonotprefermore?


26/44

Theban

customersdontfeelcomfortwiththesephoneandInternetban

ingfacilitiesandtheyalsofeelthatbyusinginternetorphoneban

ingthetimemaynotconsumedreduced.Theydoesnotevenaccesstheseonlineban

ingfacilitieseasilytheyfeelthattheyarenotreliableandconvenientashumantellersandATMsprovide.

3.3SecondaryResearchAnalysis:

Thissecondaryresearchanalysisreportwillexplainaboutthefactsofhowtodeveloptheliteraturereviewstructureandanalysisframewor

.Thesourcesforthisresearchwhichwereobtainedtomainlyuseintheliteraturereview.3.3.1PressArticlesandIndustryReports:

Someimportantfactorsintheliteraturereviewusedfromthesepressarticlesli

etheinterviews,opinionsandfromthesurveys.Thiscombinationofinformationhasbasicallyhelpedtodeveloptheliteraturereviewinaneffectivemanner.3.3.2RelatedBoo

s:

Theliteraturereviewwasbasicallydependentontheboo s.Theseboo sshowthetheoreticalaspectsfortheresearchwhichhasbeenta

esfromtheseboo

swrittenbydifferentauthors.

AcademicJournalsandReferences:Toshowloyaltyandsatisfactionofthecustom

ersinadaptingtothechangesandimplementationstheirban

sweredoingwithinformationtechnologywasseeninthejournalsthatshowedtheli

esanddisli

esofthecustomersoftheban

s.Asthishelpedtoformthebasicstructureforthesurveysandquestionsfortheinterviewsandthesurveys,thisinformationwasta

enfromlibraryandInternet.

3.4SurveyQuestionnaireAnalysis:

Thisisexplainedinthefollowingconceptusingliteraturereviewframewor

thatwasdevelopedto

nowthecustomersatisfactionlevelandloyaltyintheretailban

sandtheimpactofinformationtechnologyontheretailban

ingservices.Thequestionnairesarefirsttestedasapilotsampletodetermineifthequestionnaireswouldprovidetheresultsinregardstothequestionsaddressed.First

thefeedbac

fromthepilotresearchista

enintoconsiderationandthenitisusedinfinalizingthequestionnaireandthenafinalversionofquestionnaireispreparedwiththefinalversionofquestions.

Therearethreemainsectionsforthesurveyquestionnaires.Inthefirstpartconsistsoftheretailban

profilequestions.Thenthenextpartwillexplainsatisfactionandloyaltystagesfromthesurveyconductedonsampledpeopleregardstotheimpactofinformationtechnologyonthecustomersofretailban

s.Andthefinalpartwouldshowthecharacteristicsthatmadethecustomer ssatisfactionandloyaltytowardstheretailban

ing.

Thestartingsectioninthequestionnairehadtheprofileofthecustomerswhichhadthesampleoftheireducation,ageandgenderlevelcategorieswhichareim

portantinthissurvey.Toimprovethecapacityistheimportantaspecttoshowthedifferencebetweenthechoicesinselectingtheservicesthatwhereprovidedbytheban

s.

Thenextsectioncontainsthedetailsofthelevelofsatisfactionandlevelofloyaltyinthisquestionnaire.Thesequestionsareusefulto

nowtherelationbetweenthecustomersatisfactionlevelsandtheloyaltyofthemtowardstheirban

withtheimpactofinformationtechnologyandthechangesthatitmadeintheservicesoftheban

.


27/44

Canitbepossibletoratethehowfrequentlytheban

servicesareused?

Thequestionassessesthecustomer spreferencesovertheban

tellerstotheATMsortheInternetban

ingortothephoneban

ing.

Docustomersperceivecost?Ban

customersinIndiaandUKperceiveextracostthatisassociatedwiththeservicesprovideddifferentlyintheban

.Thesurveycustomersran

edextracostasimportantasreliableaccurateservices

WhydocustomerspreferHumanTeller/Operator?

Ban

ingcustomerschosethehumanteller/operatorwhentheyareusingtheban

servicesanabilitytoprovideinstanthelpandassistanceaswellastheircourteousservice.

Whynotphoneban

ingandInternetban

ing?

Ingeneraltheban ingcustomersdonotseeInternetorPhoneban ingservicesasconvenient.Theydonotthin

thatservicescanminimizethewaitingtimeorthetransactiontime.Andtheban

ingcustomersalsodonotperceivethatInternetban

ingandPhoneban

ingservicesareasreliableandaccurateasthatprovidedbytheATMsorthehumantellers.

Arethetechnologicalinnovationssuchasphoneban

ing,ATMsandtheInternetban

ingpreferred?

Asthetechnologywasran

edlittlelowinimportanceinthefindingsbutmorethaneightypercentofthesurveycustomersinboththecountriessaidthattheypreferredinteractingwithtechnicalservicesoverthehumantellersandmorethanninetypercentareloo ingforwardforinnovationsinthetechnologyintheban

ingservices.

HowabouttheAvailabilityofawiderangeofinnovativeandhightechservices?

Thissurveyavailabilityofawiderangeofinnovativeandhightechserviceswas

ran

edlowintermsofimportance.

Whichmodeofserviceisleastsatisfied?

InUKtheban

customersarelesssatisfiedwiththephoneban

ingservicesandfewtimesitgoesfortheInternetservicealso.HoweverincomparisontoUKtheInternetban

ingislowinIndia.WhatistheMostSatisfiedortheSatisfactoryModeofservice?

Aretheretailban

customersoftheban

aremoresatisfiedwiththepersonalizedserviceswhichareprovidedbytheban

tellersoraretheymoresatisfiedwiththeservicesthatareprovidedbythemachinesli

eATMs,Internetban

ingandPhoneban

ing?

Generallyamongtheservicesthatareprovidedbytheretailban

saretheautomatictellermachine,humantellers/operators,phoneban

ingwithoutoperatorassstance,phoneban

ingwiththeoperatorassistanceandinternetban

inginIndiandUKshowthesameresultsthatcustomersaremoresatisfiedwiththeservicesthatareprovidedbytheATMs.

Thein-depthinterviewswhichfollowedthegeneralstructureofthequestionnaire.Thismethodwasdoneinordertohaveasimilarcoverageintermsofthequestionsthatwereraisedandtheywereabletoaddresstheresearchissueeffectiv


28/44

elywiththegivenconceptualframewor

thatwasdevelopedfromtheliteraturereview.Thedifferencebetweenthein-depthinterviewandthequestionnairesisthatthecustomerswereabletorespondandprovidemoreinformationintermsoftheirresponsesandthatinturnhelpedtounderstandwhatthecustomerswereexceptingfromtheretailban

anditsservices.

Thein-depthinterviewsarealsodividedintothreemainparts.

Thefirstpartwouldmerelyintroducethemainrequirementanditwillshowtheageandeducationlevelofthecustomersandtheirrequirementswithservicesthatareprovidedbytheretailban

s.

Thesecondpartoftheinterviewisrelatedwiththequestionsregardingthesaisfactionandloyaltyofthecustomersandalso

nowingtheirresponseontheservicesli

etheATM,Internetban

ingandPhoneban

ing.Thestartingpointissimilartothequestionsinthequestionnairebutinthelaterpartofthein-depthinterviewamoredetailedinformationisobtainedfromthecustomersonapersonallevelwhat

indofservicewouldtheypreferandwhydotheypreferitandwouldtheyli

eanychangesintheservicesthatareprovidedbythe

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Impact on IT on Security of banking MBA