In recent years, the phenomenon of long queues at banking outlets has been nagging the banking industry and has become a major public concern.  Complaints from customers and overt and covert investigations by the media have made banking staff at all levels jumpy all the time.  Unsurprisingly, the uncorking of service bottlenecks and the alleviation of the queuing problem has become a most pressing matter for many outlets at CCB.  As the direct sub-branch of CCB Guangdong Branch at Tianhe has been able to solve this problem quite effectively through transformation, lessons can be learnt from it.

Scientific “Diagnosis”

Behind the queuing problem, what are the factors encumbering services and limiting efficiencies in the banking outlets?

Since as early as 2004, the long lines of customers queuing up in its outlets, the touting of queuing numbers by scalpers, the negative reporting of the media and reproofs from regulatory departments had given CCB Guangdong Branch enormous pressure.  To deal with the problem, CCB Guangdong Branch Party Committee had specifically set up an outlet service steering task group and an outlet service management office.  Subsequently, a number of measures had been implemented and relevant departments had started carrying out studies and reflections in order to get into the crux of the problem.

The studies had shown that, in the main Chinese cities in recent years, a natural growth in the number of customers and a substantial influx of village migrants had resulted in an uneven distribution of customers among different outlets.  This mismatching of supply and demand in financial services was further exacerbated by the streamlining of outlets and teller headcounts in China’s top four banks in the previous years.  Out of habits, many customers still prefer to line up before teller counters rather than using e-banking and self-service facilities.  This has led to a severe imbalance in workload among banking resources such as banking outlets, e-banking and self-service facilities, thereby sharpening the differences between overused and underused service channels for financial products.

As the Chinese economy develops, more and more varieties of financial services are needed, agency services of banks have increased and the choice of financial products has multiplied.  In particular, during periods in which stocks and funds are hotly pursued, both the number of times the average customer goes to the bank and the time required for banking matters to be handled has increased by more than four folds.  On the other hand, as incidences of financial scams and internal frauds are on the rise, a lot more corrective actions in business processes are required, so much of the counter resources has been diverted towards risk prevention and handling of internal matters and is not available for customer service.

In allocating bank resources, not only have the banks failed to segment their customers according to the complexity of the businesses they have brought into the outlets for handling, but they have also failed to categorise their counters and tellers according to customer needs.  Consequently, there is a mismatch of service resources.  So, for customers coming into to a bank to take care of some new business, if there are not enough indications to tell them what documents to bring, what procedures to take, or to which counter they should proceed, both the banks and their customers would have to waste a lot of time in unproductive work.  Moreover, as banks have also failed to assign tellers of different skills to handle different jobs, an average teller would have to take longer time to handle complicated business and customers would also have to wait longer.  For the many tellers who have to work beyond their capacity throughout the year, physical and mental fatigue would set in and their enthusiasm for customer service would deteriorate.  But as customer expectation and demand for bank services continue to rise, the number of customer complaints naturally shoots up.

Administering the Right “Medicine”

After gradually gaining an understanding of the crux of the problem, CCB Guangdong Branch first implemented one after another measures such as flexible counters, installation of lobby managers and assessing the substitution rate of self-service facilities, etc.  Then, in early 2006, after adapting the latest philosophy on running branches from IBM and the advanced concepts in banking outlet transformation from Bank of America, it initiated a project on service process reengineering and outlet transformation.  Choosing its direct sub-branch in Tianhe as a pilot outlet, it started to seek an ultimate solution to uncork the bottleneck through such measures as restructuring of outlet functions, designation of service zones, optimisation of service processes and management of customer relationship, etc.

To raise service efficiency in the outlets, one has to start with understanding and summarising the needs of the customers.  With the guidance and participation of Bank of America experts, Guangdong Branch first conducted a survey of core customer needs through on-site interviews, questionnaires (197 copies of questionnaires were distributed), sampling of counter data (including data obtained from on-site observation).  The 2,000 or so samples obtained were then summed up and designed into five main customer service processes: sales and enquiries, applications, transactions, product add-ons and on-site services.  Subsequently, 26 sub-processes were designed to strengthen both the marketing functions of the counters and customer relationship management.  In addition, back office handling procedures were simplified and specialisation of teller duties was introduced.  The aim was to "administer medicines” to the factors limiting outlet service through repositioning of the outlets, revamping the mode of operation of customer service, interactive linking up of different service channels, reengineering of outlet processes, redefining of organisational and post responsibilities and resetting of appraisal indexes.

The environs of the lobby at Tianhe sub-branch have also seen much improvement.  By providing customers with a comfortable environment and clear service signage, the proportion of customers who can follow the signage and correctly arrive at the right counter to conduct their business has greatly increased.  They are now able to prepare whatever information is necessary for their business and reduce waiting time and unproductive work at the source.

Through refurbishing and redecoration, the style and layout of old outlets have been completely phased out.  Tianhe Sub-branch is now divided into different service zones according to customer and bank product classifications.  It has a self-service banking zone (with six ATMs and self-service terminals, etc.); a general service zone (with six counters designated for different services); a financial management service zone (with three open counters for processing non-cash corporate businesses or personal financial management businesses); a customer try-out zone (with three PCs demonstrating CCB’s online banking services or for trial use) and a VIP service zone (with two financial investment counters and two meeting rooms).  With these five functional service zones offering different services to different customer groups, “car jamming” or “car crashing” in certain service channels has to some extent been minimised.

Tianhe Sub-branch has also implemented a “Lobby Supremacy” strategy to allow the lobby manager to get 100% in touch with customers so as to effectively shunting and guiding them to different zones.  This way, workload among different service zones and service channels is evened out.

Presently, while on the one hand tellers are given comprehensive training, on the other hand they are also classified into different grades.  Whereas general grade tellers are now assigned to handle relatively simple services of high frequency, high business volume and short duration per transaction, senior tellers are assigned to handle complex services of low frequency, low total volume and long duration per transaction.  This helps to avoid customer congestion due to low efficiency on the part of a teller because he or she is not familiar with the business on hand.

By designating a service function for every counter, Tianhe Sub-branch is able to steer customers with different service needs to different counters.  It has also employed the use of intelligent counter calling machines to help prioritise different kinds of services at each counter.  In addition, for customer waiting time, threshold values of 5 minutes, 10 minutes, etc. are set so that the intelligent counter calling machines can automatically assign customers to different counters to handle their affairs and so counter workload can be evened out.

The objective of administering all these medicines is to make sure that the limited resources in each banking outlet are all used in satisfying core customer needs, that service efficiency can be raised and customer waiting time can be reduced.

First Signs of “Curative Effects”

Outlet transformation and process optimisation are continuous and gradual processes.  At this stage, it can be safely said that the transformation of Tianhe Sub-branch is a success and the results are significant.  As evidence, we can put aside for the time being all the high acclaims from Headquarter management, Bank of America experts and leaders of local regulatory bodies.  The following set of figures alone is sufficient in demonstrating the “curative effects” of the “medicines” administered in transforming this sub-branch.

Through measures such as reconfiguration of service posts, change in queuing methods, implementation of flexible shifts and fostering of customer consumption habits, average customer waiting time has been reduced from 15 minutes per person to the present 9 minutes per person, ie, the average waiting time has been reduced by 6 minutes per person.  As well, the proportion of customers having to wait for less than 10 minutes is 91.96%, an improvement of 13.69% from the time before transformation was started, while the proportion of customers having to wait for less than 5 minutes has reached 61.19%.  In terms of scoring by anonymous inspectors, Tianhe Sub-branch’s score has been raised from a score of 69 in the pre-transformation days to the present score of 82.

Another result is the boosting of team marketing function of the outlet: now every staff member is marketing products and maintaining VIP customer relationship while carrying out assigned duties.  Through counter services, tellers are responsible for maintaining customers with assets from 100,000 to 300,000 yuan; through “one-to-one” services, account managers are responsible for maintaining customers with assets from 300,000 to 1 million yuan; and, through “customerised services”, sub-branch managers are responsible for maintaining customers with more than one million in assets.  As a result, each staff member in a sub-branch has to maintain a certain number of customers.  With each staff member interacting with his or her customers periodically and understanding their needs, the overall marketing capability of the sub-branch has enhanced substantially.  As at June 30th 2007, AUM at Tianhe Sub-branch had increased by 9.217 million yuan and ranked second among all CCB sub-branches.  The amount of personal deposit had increased by 15.45 million yuan, which represented an increase of 25.13 million over the same period.  Net sale of financial products was 76.62 million and was top among all CCB sub-branches.  Agency sales of life insurance had amounted to 4.89 million and were 2.99 million higher than the same period a year before.  The number of credit card sold was 825, which was 356 cards more than the same period a year before.  Income from intermediary business had reached 2.04 million, which was an increase of 1.44 million over the same period a year before.  Finally, there was an increase of 144 high-end customers, of which four were “black gold” customers, 89 were platinum customers and 51 were gold customer.  The average number of sales had increased from 21 per day to 49 per day.