🙏

Namaste

Pratap Rawal

Let’s start with a few warm-up questions

Q1: Who am I?

Q2: Why am I here?

Objective of this program

Did you give it a thought:
What might be the objective of this program?
Why might have your company organized this?

Objective of this program

Management’s POV:

Inform

Remind

Persuade

Differentiate

Let’s put our thinking hats on?

What unique single-digit numbers are A, B, and C if the sum of the three-digit numbers is ABBC, as shown below?

   A  A  A

+  B  B  B

+  C  C  C

───────────────

 A  B  B  C

🕒 Live Clock

Managing Relationships and Building Loyalty

Focus: Differentiating in ways meaningful to customers

Ground Work

Overview

What is important to any business?

A. Based on the activities it must perform

  • To build the business - SALES
  • To build the organization - PEOPLE

B. Based on business issues faced

  • I : Image
  • M : Money
  • P : Productivity
  • A : Advantage over Competition
  • C : Customer Satisfaction
  • T : Total Cost of Ownership

B. Understanding the business issues

%%{init: {
"theme": "neutral",  
"themeVariables": { "fontSize": "24px" }, 
"flowchart": { "useMaxWidth": false, "htmlLabels": false } 
}}%%
    flowchart LR
  
        I(**Image**);
        M(Money);
        P(**Productivity**);
        A(Advantage over **Competition**);
        C(Customer Satisfaction);
        T(Total Cost of Ownership);
        
          I & P & L & T ==>A==>M
          C===>L(**Loyalty**?)
          C-->I
          C-->P
          I-->P
          L==>P
          
   style I fill:#f0f1eb
   style M fill:#f0f1eb
   style P fill:#f0f1eb
   style A fill:#f0f1eb
   style C fill:#f0f1eb
   style T fill:#f0f1eb

Culture is unique to an organization

Organization Culture is about how employees work, collaborate and grow. It is:

  • Shared perception - What is important in the organization?
  • Shared value - What is right or wrong?
  • Shared understanding - What works and what does not?

conti..

… Culture is unique to an organization

Organization Culture is about how employees work, collaborate and grow. It is:

  • Shared belief and assumptions - Why these beliefs are important?
  • Shared style of working and relating to others.

Therefore, it is the collective behavior, attitude, and norms that define how people interact and align with the common purpose.

Organization Climate

Top layer of org. culture, influence working environment.

It is shared perception employees have about practices, procedures, and type of behaviors that get rewarded and supported in a particular setting. conti ..

… Organization Climate

Observed and perceived from:

  • Flexibility: leverage to innovate.
  • Responsibility: sense of it.
  • Standards: The level of which people set.
  • Rewards: The perceived aptness of it.
  • Clarity: On overall mission and values
  • Commitment: the level of it to the common purpose.

What is competition in business?

Competition

It is a constant struggle among firms for “Comparative Advantage” in resources that will yield market place position of “Competitive Advantage”.

Why is Competition dynamic?

Not all firms can be superior at the same time, It is the constant pursuit of superior performance that makes it dynamic.

Why is it important to understand competition?

If the products are identical, price cutting will continue to the level of marginal cost. - Bertrand competition

Fundamental ways to sustainable win

  • Low Costs (Not Price)
  • Differentiation.

(Porter, 2008)

Reputation (Image)

What is?

An amalgamation of all expectations, perception, and opinions about an organization, developed over a period of time, by the customers, employees, suppliers, investors, and public at large pertaining to the qualities, characteristics, behavior of an organization based on personal experiences, hearsay, or observed past actions of the organization. (Bennett & Kottasz, 2000)

Reputation - Important why?

  • Reputation is a key asset to firms as it is valuable, distinctive, difficult to duplicate, non-substitutable. Hence provides a firm with sustainable competitive advantage. (Trotta et al., 2011)
  • Good reputation helps business grow and prepares for new markets.

Reputation: The key drivers

Customers and Employees are key drivers of reputation (Watson, 2010)

%%{init: {
"theme": "neutral",  
"themeVariables": { "fontSize": "24px", "clusterBkg": "#f0f1eb" }, 
"flowchart": { "useMaxWidth": false, "htmlLabels": false, 'nodeSpacing': 20} 
}}%%
  flowchart TD
  
  P("Product / Service")
  I(Innovation)
  W(Workplace)
  C(Conduct)
  C1(Citizenship)
  L(Leadership)
  P1(Performance)
  R(Reputation)
  P & I & W & C & C1 & L & P1 --> R
  
  style P fill:#f0f1eb
  style I fill:#f0f1eb
  style W fill:#f0f1eb
  style C fill:#f0f1eb
  style C1 fill:#f0f1eb
  style L fill:#f0f1eb
  style P1 fill:#f0f1eb
  style R fill:#f0f1eb
   
   

Image drives loyalty (Bloemer et al., 1998)

%%{init: {
"theme": "neutral",  
"themeVariables": { "fontSize": "24px", "primaryColor": "#f0f1eb", 'clusterBkg': "#f0f1eb" }, 
"flowchart": { "useMaxWidth": false, "htmlLabels": false, "rankSpacing": 90} 
}}%%
  flowchart LR
I(Image)--> P("Perceived Quality") --> L(Loyalty)
P -->C("Customer Satisfaction")
C --> L

Productivity

Productivity

Output produced relative to amount of input. (It is financial evaluation of output to input.)

Labor Productivity

Revenue per employee, Value added per employee, Number of customers Served.

Efficiency

How well things are done in Time/Costs (Doing things Right) - SOP (comparison to standards)

Effectiveness

Degree to which goal is met, the outcome is achieved. (Doing the right Things)

Productivity - Relationship between major concepts

%%{init: {
"theme": "neutral",  
"themeVariables": { "fontSize": "32px", "clusterBkg": "#f0f1eb" }, 
"flowchart": { "useMaxWidth": false, "htmlLabels": false} 
}}%%
  graph LR
  
    P(Productivity)
    E(Efficiency)
    E1(Effectiveness)
  subgraph z[" "]
  direction LR
    P & E --> C(Views of the Company)
  end
  subgraph y[" "]
  direction LR
    E1--> C1(Views of the Consumer)
  end
   C1 <--> C
  

Productivity Improvements

Generic productivity improvement strategies:

  • Cost control at every step
  • Reduce waste ( Both material and labor)
  • Train and motivate to do things faster
  • Broaden variety of services that employees can perform (Cross functional exposures).
  • Capacity utilization.
  • Machine utilization (Manufacturing)

cont…

… Productivity Improvements

Generic productivity improvement strategies:

  • Export system for para-professionals to perform it. (Out-Source: on-premise)
  • Redesign customer service processes
  • Replace service employees with machines. (automation)
  • Tier Service levels (Segment customers)
  • Outsource non core activities (Non value adding activities)

conti…

…Productivity Improvements

Customer driven strategies to improve productivity

  • Change timing of customer demand.
  • Encourage use of lower cost service delivery channels and self service.

Wastes: Seven Wastes - Shigeo Shingo

  • Waiting: Lost time due to poor flow.
  • Over Production: Producing more than demand.
  • Motion: Searching in messy environment.
  • Over Processing: Unnecessary features.
  • Excess Inventory: Material in Work-in-progress.
  • Transportation: Excess movement of goods.
  • Defects: Non-compliance to specifications.
  • Skill: 8th waste un-utilized talent.

Seven Wastes - An adaptation in service

  • Opportunity lost
  • Delays
  • Duplication
  • unclear Communication
  • incorrect Inventories
  • un-necessary Movement
  • Errors

Note

Poka-Yoke: Mistake proofing. e.g. Color codding, bell at the restaurant door, double check prompts, Visual indicators on flow-charts.

Service Profit Chain (Money)

(Heskett et al., 1994)

Customer Satisfaction

What is?

Is an outcome resulting from the customer’s pre-purchase comparison of expected performance with the perceived actual performance and incurred costs. (Churchill Jr & Surprenant, 1982)

Why is it important?

Acts as an exit barrier which helps retention and repeat purchase. (Fornell, 1992)

Loyalty

Customer loyalty

Mindset of customers who hold favorable attitude towards a company, commit to repurchase, recommend company’s products to even others. (Pearson, 2016)

Loyalty - Some Observations

  • Loyalty can occur at any stage of business relationship. (Oliver, 1999)
  • Satisfaction came as a result of service quality (Fornell et al., 1996).
  • Reducing defection by 5% yields improvement in profitability of between 20%-85%. (Reichheld & Sasser, 1990)
  • Positive correlation between customer satisfaction and loyalty (Akbar & Parvez, 2009).
  • Service quality results in increased market share and repeat sales that ultimately leads to customer loyalty (Buzzell & Gale, 1987). Aydin & Özer (2005) found positive relationship between service quality and customer loyalty.

Overall: the antecedents of loyalty is Service Quality

%%{init: {
"theme": "neutral",  
"themeVariables": { "fontSize": "32px", "nodeBackground": "#f0f1eb" }, 
"flowchart": { "useMaxWidth": false, "htmlLabels": false, "rankSpacing": 180} 
}}%%
flowchart LR
A("Service Quality")
B("Customer Satisfaction")
C("Loyalty")


A & B --> C
A --> B

style C fill:#f0f1eb, stroke-width: 4px
style A fill:#f0f1eb
style B fill:#f0f1eb

Loyalty is manifested as

%%{init: {
"theme": "neutral",  
"themeVariables": { "fontSize": "24px", "nodeBackground": "#f0f1eb" }, 
"flowchart": { "useMaxWidth": false, "htmlLabels": false, "nodeSpacing": 20} 
}}%%
flowchart LR
A(Attitude);
B(Behavior);
C("Customer Loyalty");
C --> A & B

style C fill:#f0f1eb, stroke-width: 4px
style A fill:#f0f1eb
style B fill:#f0f1eb

Attitude

Behavioral

  • Repeat purchase
  • Receptive to different products (Cross-Selling)
  • Recommending to others (WOM) – (Lee et al., 2001)

Why Customer Loyalty matters

source: (Reichheld & Sasser, 1990)


Understanding Quality in Service Industry

Quality

  • What is Quality (especially in the service industry)?
  • Why is Quality important?
  • What is the most important source of Quality in the service industry?
  • How can we “explain Gaps” & “Improve Quality”?
  • How can each one us ensure quality is delivered?
  • Some Tools and Techniques
  • Can you Invest too much in Quality?

What is : Quality

Is an “attitude” of the consumer on the “global evaluation” of a service or a product. (Wirtz, 2012)

“Fitness for use”. (Juran & Gryna, 1970) “Conformance to requirements”. (Crosby, 1979) “Value for Price”. (Feigenbaum, 1991)

These definitions clearly highlight both the technical and a customer-centric view of quality.

How is an attitude formed

Attitude
It is formed over time and is based on consumption experience. –Jochen Wirtz

Service Quality

What is it?

Consistent delivery of service fulfilling customer requirements, expectations, and satisfaction.

It is the most important differentiator (Qualifies the requirements of Barney (1991) VRIN framework).

According to Parasuraman et al. (1988) it is constructed from multiple elements, it may be assessed based on:

  • Characteristics of service delivery system, and
  • Level of customer satisfaction.

… Service Quality

Evidence of its effectiveness

Over the last decade, many private banks have shown that despite providing world-class services they could remain the fastest growing banks with nationwide footprints. (Sandip, 2020)

Attribute Satisfaction to Repeat Purchase

G AS Attribute Satisfaction OS Overall Satisfaction AS->OS Repeated SQ Firm Service Quality OS->SQ Builds Image RP Repeat Purchase SQ->RP Leads To

Service Business - characteristics

%%{init: {
"theme": "neutral",  
"themeVariables": { "fontSize": "28px" }, 
"flowchart": { "useMaxWidth": false, "htmlLabels": false } 
}}%%

  flowchart LR
   C(((Attributes<br/>of<br/>Services)))
   A{{Intangible}}
   B{{Heterogenous}}
   D{{Inseparable}}
   E{{Perishable}}
   
   C====> A & B & D & E
   
   style C fill:#f0f1eb
   style A fill:#f0f1eb
   style B fill:#f0f1eb
   style D fill:#f0f1eb
   style E fill:#f0f1eb
   

In service delivery employee interactions are the primary source of perceived quality

Five Dimensions of Quality

  • Tangibility: Appearance, Physical equipment, personnel, communication and communication material.
  • Reliability: Ability to perform promised services dependably and accurately.
  • Responsiveness: The willingness to help customers and provide prompt service.
  • Assurance: The knowledge and courtesy of employees and their ability to convey trust and confidence.
  • Empathy: The provision of caring individualized attention to customers. (It does not matter in routine matters)

(Parasuraman et al., 1988)

Service System Design

Bowen (2023) credits Pierre Eiglier and Eric Langeard for pioneering the “servuction model” to understand the intricacies in the service industry.

The Gaps Model

(Parasuraman et al., 1988)

Ishikawa: The Root Cause Analysis

%%{init: {"flowchart": {"htmlLabels": false, "curve": "linear"}} }%%
flowchart LR

     %% Causes alternating above and below
    Customer["Customers"]:::b
    Back["Back Stage Staff"]:::b
    Front["Front Stage Staff"]:::b
    Procedure["Procedure"]:::b

    Others["Others"]:::b
    Facility["Facilities Equipment"]:::b
    Material["Material Supplies"]:::b
    Info["Information"]:::b

    S1(( )):::a
    S2(( )):::a
    S3(( )):::a
    S4(( )):::a

    %% Upper bones
    Customer --> S1
    Back --> S2
    Front --> S3
    Info --> S4

    subgraph " "
        direction LR
        Cause:::b --- S1--- S2---S3---S4--> Effect:::b
    end

    %% Lower bones
    Others --> S1
    Facility --> S2
    Material --> S3
    Procedure --> S4

   classDef a stroke:0
   classDef b font-size:32
   

e-Service

What is

  • Extend to which a website facilitates efficient and effective shopping, purchasing, and delivering of product and service. (Zeithaml, 2000)

  • Reliability - ability to perform the promised service

  • Dependability - do it accurately

conti …

… e-Service

Key imperatives of eSQ

  • Availability of information and content
  • Usability ease of use
  • Privacy / security for transaction
  • Graphics Aesthetics and arrangement
  • Fulfillment Is able to accomplish the intended.

conti ..

… e-Service

Causes of dissatisfaction:

  • Inability to complete the transaction
  • Lack of back-end infrastructure to receive and process complaints
  • Website must respond quickly and appropriately to the feed back

Prioriritizing the most frequent few (Pareto)

How much to invest in Service Quality

Summary SQ

  • Associated with costs (crossby, 1999)
  • With profits - (Rust & Zahorik, 1993)
  • With Customer Satisfaction -(Botton and Drew 1993)
  • With Customer retention (Reichheld & Sasser, 1990)
  • With positive WOM
  • SQ is driver of corporate marketing and financial performance (Butler 1996)

Summary why Retention

  • Long term customers buy more and if satisfied promote by referrals (WOM)
  • Long term customers are less costly.
  • Successful retention lowers the need to find new customers (May be potentially risky)
  • Long term customers are less sensitive to comparative marketing activities of competitors. (Ganesh et al., 2000)
  • Loosing customer leads to opportunity cost because of the reduced sales and increased cost of attracting and acquiring new.

Relationship Marketing

What is Relationship marketing?

Berry (1995), “Attracting, maintaining, and enhancing customer relationships.

Doyle & Roth (1992), emphasize that goal of relationship marketing is to earn the position of preferred supplier by developing trust in the key accounts over a period of time.

conti ..

What is Relationship Marketing?

Relationship marketing

  • All marketing activities directed towards establishing, developing, and maintaining successful relationship exchange.

  • Because, Service loyalty is more dependent on the development of interpersonal relationship as opposed to loyalty with tangible products. (Macintosh & Lockshin, 1997)

The Service triangle

G a Company b Customer a->b External Marketing (setting the Promise) c Employee a->c Internal Marketing (enabling the Promise) c->b Interactive Marketing (delivering Promise)

(Zeithaml et al., 2018)


Understanding the customers

Understanding Service Customer

  • How do they make decisions about buying and using the services?
  • What determines their satisfaction with it after consumption?
  • Why clients behave the way they do?

Understanding Service Customer

Three Stages in Service Consumption
  • Pre-purchase: Need-awareness, information search, evaluation of alternatives, and purchase decision.
  • Service encounter: Experiences, and consumes the service.
  • Post-encounter: Evaluation, future intentions e.g. buying again, or recommending to others.

Understanding Service Customer

Pre-Purchase

Sources of Need Arousal

  • People’s subconscious mind: personal identity and aspirations.
  • Physical conditions: e.g. Hunger
  • External Sources: Social media, Marketing activities of firms.

Understanding Service Customer

What does a customer do?:

  • Information search
  • Clarify needs
  • Explore solutions
  • Identify alternatives

Understanding Service Customer

Key concepts:

  • Need arousal
  • Evoked set
  • Consideration set
  • Multi-attribute model.

Categorizing Services

quadrantChart

    x-axis People --> Possessions
    y-axis Intangible --> Tangible

    quadrant-1 Possession-Processing
    quadrant-2 People-Processing 
    quadrant-3 Mental Stimulus-Processing
    quadrant-4 Information Processing

    Service directed at peoples bodies: [0.25, 0.9] radius: 0
        Passenger Transportation: [0.25, 0.80] radius: 0, color: #ff0000
        Lodging: [0.25, 0.75] radius: 2, color: #ff0000
        Healthcare: [0.25, 0.7] radius: 2, color: #ff0000

    Services directed at physical possession: [0.75, 0.9] radius: 0  
        Freight Transportation: [0.75, 0.8] radius: 0, color: #00ff00  
        Laundry and Dry Cleaning: [0.75,0.75] radius: 2, color: #00ff00
        Repair and maintenance: [0.75, 0.70] radius: 2, color: #00ff00

    Services Directed at Peoples minds: [0.25, 0.4] radius: 0  
        Education: [0.25, 0.30] radius: 0, color: #0000FF  
        Advertising: [0.25, 0.25] radius: 2, color: #0000FF  
        Psychotherapy: [0.25, 0.20] radius: 2, color: #0000FF

    Services directed at intangible assets: [0.75, 0.4] radius: 0
        Accounting: [0.75,0.30] radius: 0, color: #800080
        Banking: [0.75, 0.25] radius: 2, color: #800080
        Legal Services: [0.75,0.20] radius: 2, color: #800080

Note

Matrix: Who or what is the recipient vs. Nature of service (Lovelock & Wirtz, 2011)

Example banking workflow

%%{init:{"themeVariables":{"fontSize": "14px"}, "flowchart": {"htmlLabels": false, "nodeSpacing": 300, "rankSpacing": 20} }}%%

flowchart TD

  %% Nodes
  A[Application] 
  B[Docs Check]
  C{Docs ?}
  D[Request Docs]
  E[Credit Eval]
  F[Risk Assess]
  G{Eligible?}
  H[Reject]
  I[Approve]
  J[Disburse]
  K[Notify]
 
  
  %% Relationships
  A ==> B
  B ==> C
  C ==>|No| D
  D ==> B
  C ==>|Yes| E
  E ==> F
  F ==> G
  G ==>|No| H
  G ==>|Yes| I
  I ==> J
  J ==> K
  H ==> K


  %% Optional: Style class
  classDef defaultText fill:#f0f1eb,stroke:#333,stroke-width:3px, color:#000,font-size:14px;
  class A,B,C,D,E,F,G,H,I,J,K defaultText;

What quality dimension and at what stage you think the customer will notice the most?

The Expectancy - Dis-confirmation model of satisfaction

%%{init: {'theme': 'neutral', 'themeVariables': { 'fontSize': '25px' }, 'flowchart': { 'useMaxWidth': true,  'htmlLabels': false} }}%%

  flowchart LR
    a("`Performance **Expectations**`")
    b("`**Perceived** Performance`")
    c{"Confirmation / Disconfirmation"}
    s(["`Outcome: **Satisfaction**`"])
  
    a-->c
    b-->c
    c==>s
    
   
    style c fill: yellow, color: red;

Performance matches or exceeds expectations.

Scenerio Time 🕒

Scenario Practice

Customer says:
“I’m frustrated — your app keeps crashing.”

You respond:

  • Acknowledge
  • Apologize
  • Take ownership
  • Offer solution or escalate1

Takeaways

  • Loyalty is built daily by delivering Quality Service.
  • You play a key role.
  • Small actions lead to lasting loyalty

Managing Relationships and Building Loyalty

Focus: Differentiating in ways meaningful to customers

Managing and Improving service

Why Relationship is important?

Banks are delivering similar service that do not have any distinct features to retain their loyal customers. (Beerli et al., 2004)

Five strategy elements for practicing Relationship Marketing

  • Develop a core service around which to build a customer relationship.
  • Customizing the relationship to individual customer.
  • Augmenting the core service with added benefits (Flower of service).
  • Pricing services to encourage loyalty.
  • Marketing to employees that they in turn will perform well for customer. (Berry, 1995)

Where to compete (Find the winning Zone)

Activities to focus on

Too much Quality: Over investing in luxury elements where customer don’t have value.

Qualify your call (Pre and Post)

%%{init: {'theme': 'base', "themeVariables": {'fontSize': '32px', 'primaryColor': '#f0f1eb'}, "flowchart":{"htmlLabels": false} } }%%
  
  flowchart TD

    B("B")
    A("A")
    N("N")
    T("T")

    B --- x("Budget")
    A --- y("Authority")
    N --- z("Need")
    T --- w("Time Frame")
    

Types of leads (Know who you are meeting)

%%{init: {'theme': 'base', "themeVariables": {'fontSize': '24px', 'primaryColor': '#f0f1eb'}, "flowchart":{"htmlLabels": false} } }%%

flowchart TD
  a(G) --- g1("Gate Keeper")
  b(U) --- u1("User")
  c(I) --- i1("Influencer")
  d(D) --- d1("Decision Maker")
  e(E) --- e1("Emptor or Buyer")

Types of selling and broad call objectives

People buy for two reason

  • Hedonistic - Purchase brings pleasure
  • Utilitarian - Functional purpose (This is the bank products)
Sales types

Solution selling

Consultative selling

Transactional selling

conti ..

… Roles played in the calls

  • Trappers - (Qualify the prospect)

  • Hunters - (Account Development)

  • Farmers - (Build Relationship)

Why make a call (Broad Objectives)

Call to get attention and explore opportunities

Call to deliver insights

Need assessment or problem solving

Consult and recommendations products possibilities.

To decide does it make sense to pursue the matter at hand (close a deal or differ amicably).

Innovate to achieve : S.C.O.R.E Model

%%{init: {'theme': 'base', "themeVariables": {'fontSize': '24px', 'primaryColor': '#f0f1eb'}, "flowchart":{"htmlLabels": false} } }%%
flowchart LR
    %% Arrange letters in SCORE order
    subgraph ScoreLine[ ]
        S1["Symptoms"] --- C1["Cause"] --- O1["Output"] --- R1["Resource"] --- E1["Effect"]
    end

    %% Draw logical connections (invisibly placed arrows)
    C1 --> S1
    S1 --> O1
    O1 --> E1
    R1 --- C1

Maintain record by customer

Minimal record to maintain

  • Name Address details of the client
  • Currently Identified requirement of the customer
  • Date of visit
  • Objective of the call: Follow up, closing a deal, providing information …
  • Discussion point: Function, Features, Benefits, Concerns, Questions, Additional requirements, others ..
  • Action items: Inform, follow-up: (email, call back, in-person) date: (or within: –days)
  • Challenges faced: objections, Budget related…, terms related ..,

Keeping Records

HNI Client Record

Client Overview

  • Net Worth: Rs 7M (est.)
  • Primary wealth source: Real Estate
  • RM assigned: Mr/Ms XYZ

Product Holdings

Product Status Notes
Portfolio Management Active Moderate Risk
Home Loan Closed Paid early

Investment Behavior

  • Diversification: Low
  • Instruments: Security, FD, MF, …

Recent Interactions

  • 2025-05-10: Discussion on ____________

Growth Plan

  • Invite to premium event
  • Review estate planning

HNI Client Scorecard

Category Metric Score (1–5) Notes
AUM (Assets Under Mgmt) Total funds with the bank
Investment Diversity Mutual funds, equity, debt, etc.
Wealth Growth YoY change in portfolio value
Referral Influence Referrals or introductions made
Relationship Exclusivity Primary bank vs multiple banks
Personalized Engagement Birthday/anniversary notes, events

Corporate Client Record

Executive Summary

  • Relationship health
  • Key financials
  • Major activities since last report

Client Profile

  • Legal Name, Group Structure
  • Industry Classification (NSIC)
  • Revenue, Tenure

Product Portfolio

Product Limit Utilization Tenure Status
Working Capital Rs 5M 78% 2 yrs Active
Trade Finance Rs 10M 65% 3 yrs Active

Engagement & Insights

  • Last RM visit: May 2025
  • Next review due: July 2025

Opportunities & Risks

  • Interest in ____ financing
  • High leverage ratio (4.2x)

Corporate Client Scorecard

Category Metric Score (1–5) Notes
Industry Standing Market share, reputation
Credit Utilization Usage vs sanctioned limits
Consortium Behavior Interactions in multi-banking setups
Strategic Alignment Fit with bank’s long-term strategy
Treasury Potential FX, CMS, hedging usage
ESG Alignment Sustainability focus

SME Client Record

Client Summary

  • Business: Local textile exporter
  • Location: Pokhara
  • Years active: 8

Account Snapshot

Account Type Balance Limit Status
Biz Account Rs 85K - Active
Term Loan - Rs 250K Performing

Engagement Log

  • 2025-05-15: Site visit
  • 2025-05-25: FX consultation

Needs & Opportunities

  • Digital payment gateway
  • Seasonal credit line

Risks

  • Delay in Tax filing

SME Client Scorecard

Category Metric Score (1–5) Notes
Loan Utilization OD/CC usage vs limit
Business Growth YoY sales growth
Transaction Volume Monthly turnover in business accounts
Working Capital Cycle Days Inventory, Receivables
Collateral Quality Type, valuation
Relationship Depth Staff interactions, loyalty

Summary Action Plan for all type of clients

Across Segments

  • Standardize periodic reviews
  • Use CRM logs effectively
  • Prepare customer scorecards

Key priorities

  • Identify up-sell signals
  • Cross sell opportunities
  • Tailor product education
  • Escalate early warning signs

Score Summary & Recommendation

Total Score Category Suggested Action
24–30 Strategic Client Deepen relationship aggressively
18–23 High-Potential Client Targeted cross-sell/up-sell
12–17 Moderate Engagement Relationship-building required
< 12 At-Risk or Dormant Re-engage or exit strategy

Frederick Reichheld

{{<video https://www.youtube.com/watch?v=QQNugxuzPM8&t=20s>}}

?

Group Activity 1 🕒

Customer Feeback Collection Tools

Tool Firm Process Transac-
tion Specific
Actionable Representa
-tive Reliable
Potential for Service recovery First hand Learning Cost Effective
Total Market Survey Yes - - - Yes - - -
Annual Survey on Satisfaction 50:50 - - Yes - - - -
Transaction Survey Yes Yes 50:50 50:50 Yes - - -
Service feedback cards and messages 50:50 Yes Yes 50:50 50:50 Yes 50:50 Yes
Mystery Shopping - 50:50 Yes Yes - - 50:50 -
Unsolicited feedback -complaints - 50:50 Yes Yes - Yes 50:50 Yes
Focus Group - 50:50 Yes Yes - 50:50 Yes 50:50
Service Reviews - 50:50 Yes Yes - Yes Yes 50:50
Online reviews & Discussions (social media) - 50:50 Yes Yes - Yes Yes Yes

Customer Feedback Collection Tools (1/3)

Tool Firm Process Transac-
tion Specific
Actionable Representa-
tive Reliable
Potential for Service recovery First hand Learning Cost Effective
Total Market Survey Yes - - - Yes - - -
Annual Survey on Satisfaction 50:50 - - Yes - - - -
Transaction Survey Yes Yes 50:50 50:50 Yes - - -

Customer Feedback Collection Tools (2/3)

Service feedback cards and messages 50:50 Yes Yes 50:50 50:50 Yes 50:50 Yes
Mystery Shopping - 50:50 Yes Yes - - 50:50 -
Unsolicited feedback - complaints - 50:50 Yes Yes - Yes 50:50 Yes

Customer Feedback Collection Tools (3/3)

Focus Group - 50:50 Yes Yes - 50:50 Yes 50:50
Service Reviews - 50:50 Yes Yes - Yes Yes 50:50
Online reviews & Discussions (social media) - 50:50 Yes Yes - Yes Yes Yes

Effective Communications Strategy

“Fastest way to kill a poor product is to advertise is heavily” on the other hand: Marketing communication, in one form or another, are essential to a company’s success

Communication Mix

%%{init: { 'theme': 'base', 'themeVariables':{ 'fontSize': '24px', 'primaryColor': '#f0f1eb', 'rankSpacing': 2 }, 'flowchart':{'clusterBkg': '#f0f1eb' } } }%%

flowchart TD


%% Personal Communications
subgraph "**Personal<br/>Communications**"
  
  I1[ ]:::a--- S1(Selling) --> CS("Customer Service") --> T(Training) --> T1(Telemarketing) --> W("Word of Mouth")
end

%% Advertising
subgraph "**Advertising**"
  
 I2[ ]:::a--- B0(Broadcasting) --> P(Print) --> I(Internet) --> O(Outdoor) --> DM("Direct Mail")
end

%% Sales Promotions
subgraph "**Sales<br/>Promotions**"
  
 I3[ ]:::a--- S2(Sampling) --> C(Coupons) --> SR("Sign-up Rebates") --> G(Gifts) --> P1("Prize Promotion")
end

%% Public Relations
subgraph "**Public<br/>Relations**"
  
  I4[ ]:::a--- PR("Press Release") --> PC1("Press Conference") --> SE("Special Events") --> S3("Sponsorships") --> TS("Trade shows,<br/>Exhibitions") --> MI("Media-initiated<br/>Coverage")
end

%% Instructional Material
subgraph "**Instructional<br/>Material**"
  
  I5[ ]:::a--- WS("Web<br/>Site") --> B1(Brochures) --> IM1("Instructional<br/>Manuals")
end

%% Corporate Design
subgraph "**Corporate<br/>Design**"
  
 I6[ ]:::a--- S4(Signages) --> ID("Indoor<br/>Decor") --> V(Vehicles) --> E(Equipment) --> S5(Stationery) --> U(Uniform)
end

classDef a fill-opacity: 0.0, color: #f0f1eb, stroke-width:0px;

Communication

  • Must be effectively synchronized to attract new customers and to reconfirm the choice of existing customers while educating them how to proceed through the service.

  • Advertising and sales promotion used even for demand management and capacity utilization.

  • AIDA

Communication

  • Messaging originates from

    • Production channels ( Front line Staff, Service Outlets, Self-service delivery points)
    • Marketing Channels ( Advertising, Public Relations, Direct Marketing, Sales Promotions, Personal selling, Trade Shows, Internet and mobile)
    • Outside the organization ( Word of mouth, Blogs, Social networks, Media Initiated Coverage)
  • Permission Marketing: reaching out the customer who consented to do so.(eg integrate email with website)

  • Sales promotions: communication attached to incentives. (time bound, price, customer group specific) downside may have poor repurchase power and lower life-time-value.

Communication

  • Personal selling: educate, inform, persuade. A consultant.

  • Trade shows: Paid publicity and personal selling opportunity.

  • Wesite: Build awareness, interest, inform, educate, consultation, permission marketing, two way communication, chat rooms, ordering.

    • High quality content
    • Easy to use
    • Quick download
    • Updated frequently.
  • Front-line employees: Up-sell, cross sell, educate, inform, consult

Communication

  • Word of mouth: recommendations from other customers is usually view more credible. one satisfied customer talks to 7 while one dissatisfied talks to 11 other prospective and existing customers.

  • Ethical consideration: do never break the promise. No unrealistic or exaggerated promises to secure sales. No unwanted intrusion.

  • Integration issues: front line not aware of the new campaign, since other department created it.

Communication effectiveness

Noise

Physical

Physiological

Psychological

Semantic

Example

  • The RM uses technical language without checking understanding.

  • The channel (like a phone call) has physical or emotional noise.

  • There’s no immediate feedback loop, so misunderstandings go undetected.

Communication effectiveness

Corrective actions

  • Encourage feedback (“Does this make sense to you?”)

  • Use clear, client-friendly language

  • Follow up with written summaries (e.g., a recap email)

Designing and managing service Processes

Process

Method and sequence in which an operating system works and specify how each task links together to create an outcome.

In high contact services, customers are an integral part of the operations, thus process becomes their experience.

Flow charting

Is a technique of displaying the nature and sequence of the different steps involved in delivering the service to customer.

Designing and managing service Processes

Blue Printing

More advanced version of flowcharts. Specifically useful for designing new services, or redesigning the existing. How the service should be constructed, identifies the potential fail points. Marketers and operations must work it out together. (it is about flows, sequences, relationships, and dependencies)

Poka Yokes

Effective tools to alert at the fail points.

Designing and managing service Processes

Service Process Re-Design

Revitalize processes that have become outdated. Change in technology, customer needs, added service features, new offerings.

External environment makes existing practices obsolete. Need to remain relevant.

Internal rusting deterioration in the internal process, creeping bureaucracy, evolution of spurious, unofficial standards. ( symptoms such as extensive information exchange, data redundancy, a high ratio of checking and counter checking, increased exception processing, growing customer complaints)

Group Activity 2 🕒

Improve service quality & productivity

Step #1

Determine priority processes

Tools:

  • Pareto, Statistical Process control on Number of complaints. (Mapping the errors)
  • Priority matrix: potential business impact vs Ease of implementation

Step #2

Set new targets for shortlisted processes

  • Customer satisfaction
  • Errors
  • Cycle time
  • Productivity improvement
Tools:

Benchmarking

the Target level

Use the project charter

Step #3

Identify the key elements of quality in the priority service process determine customer needs and expectations.

Tools

Blue print to identify all the touch points of customer journey and the line of visibility to understand customer views of a process.

For each touch point determine what quality means to the customer. Use the five dimensions of quality model.

Identify and record the customer drivers of delight and disgust.

Focus group, Customer feedback, and Content analysis (social media, written complaints).

Note

How many complaints are good enough to initiate action?

Step #4

Assess the process performance

  • Review hard operational process measures ( cycle time, customer waiting time, on time resolution…)
  • Measure the customer perception of process performance ( process specific customer satisfaction)
  • Interview front line employees to obtain their views of what works and what don’t ans what needs an urgent improvement.

Step #5

Identify performance shortfalls and quality gaps

  • Map customer need and wants of the process against process performance measures to determine important performance quality gaps

  • Identify the main performance gaps ( map frequency count of service failure, complaints) on the service blue print to understand where exactly service process fail.

Step #6

Identify root cause of the gaps

  • Make use of the GAPS Model to capture all possible sources of gaps.
  • TQM tools to drill down on specifics
TQM Tools:

Pareto charts, to understand major fail points

Ishikawa (Fish bone) to identify causes and again Pareto on this result to identify the major root cause.

Step #7

Improve process performance

  • Use prescriptions from the gaps model
  • Customer service re-design
  • Plan service recovery for fail points that cannot be designed out of the system.

Step #8

Control, finetune and continuously improve.

  • Monitor the performance ( Operational measures and customer feed back)
  • Make it a routine process at high level
  • Ask process owner to fine tune the process through incremental improvements.
Tools:

Six Sigma (Define Measure Analyze Improve Control)

Step #9

Start Over

Journey itself is the destination. Become a customer driven and learning organization

Tools

TQM

Six Sigma

Assessment tools of - Malcolm Baldrige & EFQM (European Foundation for Quality management)

References

Akbar, M. M., & Parvez, N. (2009). Impact of service quality, trust, and customer satisfaction on customers loyalty. ABAC Journal, 29(1).
Aydin, S., & Özer, G. (2005). The analysis of antecedents of customer loyalty in the turkish mobile telecommunication market. European Journal of Marketing, 39(7/8), 910–925.
Barney, J. (1991). Firm resources and sustained competitive advantage. Journal of Management, 17(1), 99–120.
Beerli, A., Martin, J. D., & Quintana, A. (2004). A model of customer loyalty in the retail banking market. European Journal of Marketing, 38(1/2), 253–275.
Bennett, R., & Kottasz, R. (2000). Practitioner perceptions of corporate reputation: An empirical investigation. Corporate Communications: An International Journal, 5(4), 224–235.
Berry, L. L. (1995). Relationship marketing of services—growing interest, emerging perspectives. Journal of the Academy of Marketing Science, 23, 236–245.
Bloemer, J., De Ruyter, K., & Peeters, P. (1998). Investigating drivers of bank loyalty: The complex relationship between image, service quality and satisfaction. International Journal of Bank Marketing, 16(7), 276–286.
Bowen, D. E. (2023). A tribute to dr pierre eiglier: A service field founder with timeless service wisdom. Journal of Service Management, 34(1), 1–9.
Buzzell, R. D., & Gale, B. T. (1987). The PIMS principles: Linking strategy to performance. Simon; Schuster.
Churchill Jr, G. A., & Surprenant, C. (1982). An investigation into the determinants of customer satisfaction. Journal of Marketing Research, 19(4), 491–504.
Cronin Jr, J. J., & Taylor, S. A. (1992). Measuring service quality: A reexamination and extension. Journal of Marketing, 56(3), 55–68.
Crosby, P. B. (1979). Quality is free: The art of making quality certain. (No Title).
Doyle, S. X., & Roth, G. T. (1992). Selling and sales management in action: The use of insight coaching to improve relationship selling. Journal of Personal Selling & Sales Management, 12(1), 59–64.
Feigenbaum, A. V. (1991). Total quality control. New York, 12.
Fornell, C. (1992). A national customer satisfaction barometer: The swedish experience. Journal of Marketing, 56(1), 6–21.
Fornell, C., Johnson, M. D., Anderson, E. W., Cha, J., & Bryant, B. E. (1996). The american customer satisfaction index: Nature, purpose, and findings. Journal of Marketing, 60(4), 7–18.
Ganesh, J., Amod, M. J., & Reynolds, K. E. (2000). Understanding the customer base of service providers: An examination of the differences between switchers and stayers. Journal of Marketing, 64(3), 65–87.
Grönroos, C. (2000). Service management and marketing: A customer relationship management approach.
Heskett, J. L., Jones, T. O., Loveman, G. W., Sasser, W. E., Schlesinger, L. A., et al. (1994). Putting the service-profit chain to work. Harvard Business Review, 72(2), 164–174.
Juran, J. M., & Gryna, F. M. (1970). Quality planning and analysis: From product development through usage. McGraw-Hill New York.
Lee, J., Lee, J., & Feick, L. (2001). The impact of switching costs on the customer satisfaction-loyalty link: Mobile phone service in france. Journal of Services Marketing, 15(1), 35–48.
Lovelock, C., & Wirtz, J. (2011). Services marketing: People, technology, strategy, 7th edition.
Macintosh, G., & Lockshin, L. S. (1997). Retail relationships and store loyalty: A multi-level perspective. International Journal of Research in Marketing, 14(5), 487–497.
Oliver, R. L. (1999). Whence consumer loyalty? Journal of Marketing, 63(4_suppl1), 33–44.
Parasuraman, A., Zeithaml, V. A., & Berry, L. L. (1988). Servqual: A multiple-item scale for measuring consumer perc. Journal of Retailing, 64(1), 12.
Pearson, S. (2016). Building brands directly: Creating business value from customer relationships. Springer.
Porter, M. E. (2008). Competitive advantage: Creating and sustaining superior performance. simon; schuster.
Reichheld, F. F., & Sasser, W. E. (1990). Zero defeofions: Quoliiy comes to services. Harvard Business Review, 68(5), 105–111.
Sandip, S. (2020). The inside story of indian banking.
Trotta, A., Iannuzzi, A., Cavallaro, G., Dell’Atti, S., et al. (2011). Banking reputation and CSR: A stakeholder value approach. In Service dominant logic, network & system theory and service science: Integrating three perspectives for a new service agenda. Giannini Editore.
Watson, T. (2010). Reputation models, drivers and measurement.
Wirtz, J. (2012). Essentials of services marketing. FT press.
Zeithaml, V. A. (2000). Service quality, profitability, and the economic worth of customers: What we know and what we need to learn. Journal of the Academy of Marketing Science, 28, 67–85.
Zeithaml, V. A., Berry, L. L., & Parasuraman, A. (1996). The behavioral consequences of service quality. Journal of Marketing, 60(2), 31–46.
Zeithaml, V. A., Bitner, M. J., & Gremler, D. D. (2018). Services marketing: Integrating customer focus across the firm. McGraw-Hill.