Towards Improving Banking Services Quality - 18 - A Bank Related Case Study and A Lean Banking Insight

Towards Improving Banking Services Quality 

18.

A Bank Related Case Study and A Lean Banking Insight

 

Introduction

 

Efficiency and customer satisfaction are cornerstones of successful banking operations. However, traditional banking processes often suffer from inefficiencies, leading to customer dissatisfaction and operational delays. This chapter examines a case study of a banking process, identifies inefficiencies from the customer's perspective, and explores solutions using Lean Banking principles. By reflecting on an insightful experience from 1975, we also uncover the enduring relevance of streamlining banking operations to achieve faster service and greater satisfaction.

 

Case Study Overview

A customer visits a bank branch for two purposes: withdrawing cash and submitting an internet banking application. While the customer eventually completes both tasks, the process takes approximately 30 minutes, leading to dissatisfaction due to long waiting times and multiple interactions with different staff members. The original process is depicted in Figure 12, which highlights its inefficiencies.

 

Customer’s Perspective

From the customer’s viewpoint, the primary concern is the prolonged time spent at the bank. The need to visit multiple counters exacerbates the waiting time, making the experience tedious.

 

Identified Wastage

 

·       Unnecessary movement: The customer must visit different counters for cheque validation, payment, and application submission.

 

·       Redundant processes: Multiple staff members handle tasks that could be consolidated.

 

Proposed Solution: Single-Window Service

Introducing a single-window system eliminates the need for the customer to move between counters. A bank official handles all tasks, including cheque validation, payment, and application submission. The revised process, shown in Figure 13, reduces the lead time to less than five minutes, resulting in a satisfied customer. 

Figure 12- Banking Process Cross-functional Flowchart

Figure 12 – Original Process Flowchart:

This flowchart demonstrates the conventional banking process, where the customer interacts with multiple staff members (SB Clerk, Officer 1, Officer 2, and Cashier). Each step introduces waiting time and delays. 

Figure 13 – Banking Process Revised Flowchart

Figure 13 – Revised Process Flowchart:

The revised flowchart demonstrates a simplified banking process where a single bank official performs all tasks, such as cheque validation, payment, and processing the internet banking application. This eliminates redundancies and unnecessary customer movement within the bank.

In the original flowchart (Figure 12), the customer is required to visit multiple places, interacting with different staff members, which increases waiting time and causes frustration. In contrast, the revised process (Figure 13) streamlines operations by consolidating all tasks into a single point of interaction. This reduces the lead time significantly, allowing the customer to complete their work in under five minutes and leave the bank satisfied.

 

A Lean Banking Insight - An Old Experience 

 

It is an old experience of the author that speaks about a Lean Banking insight. In 1975, the author was working as a Foreign Exchange Counter Clerk at a PSU bank in Jaipur, India. His role involved assisting foreign tourists with the exchange of foreign currency and travellers' cheques. However, the bank's procedure was cumbersome, requiring approximately 30 minutes per transaction. This process involved multiple steps:

 

1.       The tourist filled out an application and submitted it with their currency or travellers' cheque.

2.       Their passport was inspected, and a token was issued.

3.       As a clerk, I calculated the exchange amount and prepared a voucher.

4.       The voucher was then checked and approved by an officer.

5.       Finally, the cashier processed the payment.

 

This multi-step process required the involvement of three staff members: a clerk, an officer, and a cashier.

 

Later that year, during a visit to Sri Lanka, the author experienced a striking contrast at a bank counter in Talaimannar. The entire currency exchange process was handled by a single individual and completed within a few minutes. Not only was the exchange fast, but the person also provided him with the necessary certificate of exchange.

 

This efficiency demonstrated a practical application of what we now recognize as Lean Banking. The Sri Lankan bank's streamlined process minimized delays, reduced redundancies, and empowered a single staff member to handle the transaction end-to-end. This comparison remains a vivid example of how simplified and customer-focused procedures can enhance operational efficiency.

 

Conclusion 

The transition from traditional banking practices to leaner, customer-focused systems offer immense potential for enhancing efficiency and satisfaction. By learning from past insights and reimagining existing workflows, banks can minimize waste, empower employees, and deliver seamless experiences to their customers. As illustrated by the case study and the 1975 anecdote, Lean Banking is not just a methodology but a transformative mindset for modern banking. 

I welcome your comments, questions and suggestions. 

Warm regards,

Keshav Ram Singhal 

Next - Lean Banking: A Roadmap to Efficiency and Excellence