A Study on Customer Satisfaction in Banking Industry in Sri Lanka

Topics: Bank, Customer satisfaction, Customer service Pages: 8 (2817 words) Published: September 1, 2009


World class companies have taken more market share by providing notably better customer service. Executives know that to stand out in a crowded field of competitors, customer service is a very critical component in achieving and maintaining a high level of customer satisfaction. When pressures move the organization to meet only performance goals and measurements such as overhead absorption, shipping dollar targets, labour efficiency, purchase price variance and the like, however, customer service often takes a back seat to these other concerns. The result can be a plunge in customer satisfaction and ultimately, if allowed to continue, erosion in market shares. Because of globalization, internationalization, technical innovations, law deregulations, and market saturation, the current situation of the banking industry is changing. The intensity of competition increases due to new products and services as well as the entrance of competitors from other industries, such as the so-called non- and near-banks. Even more, the continuously growing educational standard as well as better opportunities to gather information induce enormous changes in customer behavior. Thus, competition for customers becomes more difficult and, considering the growing intensity of competition, the major banks’ need for sustained competitive advantage increases Organisations often think the way to measure customer satisfaction is to examine the number of customer complaints. The problems with this method is that it is reactive, it only responds (if at all) after the event and it does not really measure satisfaction only dissatisfaction. Monitoring complaint levels does not really tell if the customers are any more or less satisfied with the product or service. For example, consider how many times you have been dissatisfied with a product or service - say once a month. Now how many times have you written to complain - possibly once or twice or maybe never. Managers and Directors often say "if our customers are unhappy, they soon tell us". Well do they? If on a personal level you rarely write to complain, what happens as a company level - is it different? Here is an example of an organisations basing its customer satisfaction strategy on levels of customer complaints and getting badly misled. In a Warehousing organisation, customers were unable to obtain product (spares, consumables, etc.) from the newly relocated, reorganised and centralised warehouse. Deliveries were often late or wrong if they arrived at all. The customer complained verbally but being unable to obtain their spare or consumable, spent their time looking for an alternate supplier rather than wasting their time complaining. The customer could not afford the time to complain, they were too busy avoiding their processes from stopping by sourcing the required items from another supplier. The Warehouse turnover plummeted. "If our customers are unhappy we'll soon know about it" said management. Well, they didn’t at least not until it was too late and they had lost 90% of their customers. Yes 90%. There is obviously a strong link between customer satisfaction and customer retention. Customer's perception of Service and Quality of product will determine the success of the product or service in the market. With better understanding of customers' perceptions, companies can determine the actions required to meet the customers' needs. They can identify their own strengths and weaknesses, where they stand in comparison to their competitors, chart out path future progress and improvement. Customer satisfaction measurement helps to promote an increased focus on customer outcomes and stimulate improvements in the work practices and processes used within the company.

In any type of business, whether companies are selling toy airplanes or offering massages, customer satisfaction plays a key role in the success of the business. Much like...
Continue Reading

Please join StudyMode to read the full document

You May Also Find These Documents Helpful

  • Customer Satisfaction in Banking Industry Essay
  • Essay about Customer Satisfaction in Banking Industry
  • Customer Satisfaction in the Banking Sector Essay
  • Customer Satisfaction in Indian Banking Products Essay
  • Customer Relations in the Banking Industry Essay
  • Study on Customer Satisfaction Essay
  • Essay on Factors of Customer Loyalty in Banking Industry

Become a StudyMode Member

Sign Up - It's Free