Case Study

HISTORYIncorporated in 1967 through the merger of 4Danish banks.

The mid-Jutland area: Silkeborg Bank, Kjellerup Bank, Kjellerup Handels- og Landbobank and the Handels- og Landbrugsbank in Silkeborg.

Recognized at most differentiated and unremarkable bank.

But in mid 90s, the change process lost its differentiating characteristic.

Till 2003, Jyske bank has maintained the highest number of satisfied customer.

Questions????Q: As of the mid-1990s,what was Jyske Bank’s competitive positioning, that is, what did it do for customers relative to its competitors?

Q: As of 2003, what was Jyske Bank’s competitive positioning?

Q: What did Jyske bank change to enable it to deliver its new competitive positioning?

Q: How did Jyske Bank implement those changes?

Strategies (Tangibles)MID 1990’S

One employee for a group of customers

Servicescape

Physical Evidence: Dull images for employees

2003

A customer allotted to a group of bankers

Round tables, computer visible, no longer a dais, play place, café outlet, specially designed meeting rooms, change in interiors.

Friendly images of employees.

Strategies(Intangibles)MID 1990’S

Training provided to employees

A long procedure before process could be computer

2003

Training provided to employees

The procedure is highly reduced for better services.

Services 7 Ps

Kaffe Bar At Bank

Expanded Marketing Mix Expanded Marketing Mix for Servicesfor Services

PEOPLE PHYSICAL EVIDENCE

PROCESS

Employees

Facility design Flow of activities

Customers Equipment – IT and coffee machines

Number of steps

Communicating culture and values

Level of customer involvement

Employee training Business Cards Surprise audits and checks

Other tangibles

Jyske’s Competitive Positioning

Out of the Box Service

Physical evidence:

Developing a niche market and targeting the right set of customers.

A customer assigned to a group of bankers.

Friendly pictures of employees.

Cutting edge

Technology – Similar

Delivery – Significant Difference

a)Tools developed Customer Needs Identify

b)Tools + People Cutting Edge

Value added People: Being nice to customers

Making time for customers

Caring about customers.

Focused at niche market

Training in team building and customer service.

Empowerment to employees.

Incentives

Service Differentiates Process: Traditional product selling to customer solution approach.

Delivery of financial products changed.

Employee centric

Empowering employee for decision making

Training

Commitment

Incentives

Service Quality

Product Quality

Price

Customer Satisfaction

Situational Factors

Personal Factors

Customer Loyalty

Reliability

Responsiveness

Assurance

Empathy

Tangibles

Service Quality Responsiveness

According to the Companies core values published for the three major stake holders, Reliability comes under value (1) – Common Sense >> With both feet placed firmly on the ground, we think before we act<<•Consider common sense our best guide•Apply common sense when solving problems and meeting daily challenges•Allow common sense to override awkward customs and routines•Take action whenever we encounter examples of bureaucratic and routines•Observe existing rules and regulations•Accept that control measures are necessary to a certain degree•Generate satisfactory short and long term financial results by pursuing sound business practices•Apply common sense whenever we incur group expenses

Service Quality Assurance

According to the Companies core values published for the three major stake holders, Reliability comes under value (2) – Open and Honest>> We are open and honest in both word and action<<•Keep each other up-to-date on relevant matters, and do not misuse information obtained in the course of our work•Restrict the degree of openness only by business considerations or by considerations for other stakeholders•Respect agreements entered into and do not betray the bank’s confidence•Strive towards making important decisions concerning individual employees on the basis of constructive dialogue•Communicate openly about the mistakes we make and the problems we encounter•Accept that mistakes are made, that they are corrected, and that focus is then on learning from the process•Listen openly to new ideas and constructive criticism

Service Quality Empathy

According to the Companies core values published for the three major stake holders, Reliability comes under value (3) – Genuine Interest and Equal Respect>> We demonstrate insight and respect for other people<<•Recognize that no two people are alike•Seek lasting relations with shareholders, customers, and employees•Offer qualified advice matching the financial needs and requirements of each customer•Have job security based on mutual obligations and that we pay attention to individual and personal needs•Allow the highest possible degree of personal influence on assignments, working hours, and place of work

Service Quality Reliability

According to the Companies core values published for the three major stake holders, Reliability comes under value (4) – Be efficient and persevering>> We work consistently and with determination to reach our goals<<•Use JB 2005 (the bank’s core values) as a guide in our daily work•Are not blown off course because of external circumstances - •Adopt an organization which promotes efficiency•Consider security important •Are convinced that efficiency increases with the level of personal responsibility•Allow employees to assume personal responsibility for day-to-day decisions – even when the basis for decision making may not be 100% perfect•Acquire the level of skills required through personal and professional development•Act on the basis of competence rather than organizational charge•Support our decisions by well-founded arguments, working hours, and place of work

Product Quality

• New IT systems helped employees take customers through processes to determine their needs and find appropriate solutions

E..g : Determining the style of investment products based on risk aversion, time frame and return goals customized for a particular client

• 98% of the loans processed at regional office itself

• Smaller loans provided almost instantly

• Larger loans approval time reduced from 3 weeks to 10 days

Price

• As delivering this type of service was expensive, the bank charged a slight premium

• Targeted to customers who were less likely to represent a credit risk

• Expectations regarding price and terms were more often included in the application

Service Quality

Tangibles & Intangibles

• Accounts Teams• Branch Design• Details• Empowering the branches

TangiblesAccount Teams

1.Caring about customers as individuals

Branch Design

1.Customer interaction with bankers

2.Café: Customer feels welcome

3.Round tables: Equality

4.Screen visible: Openness

5.Home like meeting rooms

6.Better photographs: Old family like

IntangiblesEmpowering the branches

1.Improved customer experience

2.Quality of information and hence quality of loans improved

3.Acceptable to customer as well as bank

4.Improved branch credit skills, no incentive to make poor loans and robust internal auditing function

IntangiblesEmpowerment throughout the Bank

1.When in doubt, ask

2.Working hours and vacation

3.Spend what you need to spend

4.Telling what is expected and checking behavior

Human Resource Strategies for Closing GAP 3

Customer-oriented Service Delivery

Hire theRight People

ProvideNeeded Support

Systems

Retain theBest

People

DevelopPeople to

DeliverServiceQuality

Compete

for

the B

est

People

Hire for Service

Competencies and Service Inclination

Provide Supportive Technology

and Equipment

Tre

at

Em

plo

ye

es

a

s

Cu

sto

me

rs

Em

po

we

r E

mp

loy

ee

s

Be the Preferred

Employer Train for

Technical and

Interactive

Skills

Prom

ote

Team

wor

k

Measure

Internal

Service

Quality

Develop Service-

oriented Internal

Processes

Mea

sure

and

R

ewar

d S

tron

g S

ervi

ce

Pro

vide

rs

Include

Em

ployees in

the

Com

pany’s

Vision

Thank You