Building equity

Editor’s note: Frank Aloi is founder and president of ath Power Consulting, an Andover, Mass., research and consulting firm.

The Tyco scandal, the Enron collapse, a 40-year low in the federal funds rate, a squeamish stock market, depressed retail sales, and plummeting consumer confidence - so how do banks increase sales and enhance current relationships in such erratic, untrusting markets? By providing all of their customers and potential customers with consistent, service-oriented, knowledge-filled interactions and confident employees. In a nutshell, by strengthening their corporate culture.

So what does a mystery shop program have to do with the corporate culture of a financial institution? Well, if you are currently mystery shopping and you do not know the answer, then your program is not working for you as it should be.

In light of the tough market, financial institutions are reevaluating their sales and service strategies. Now more than ever, institutions must pay close attention to their people and message. Why? Because extreme focus needs to be placed on brand-building and brand loyalty. Branding is paramount in acquiring and retaining customers. As a result, more and more financial institutions are using shop studies to monitor how current and potential customers perceive them.

Here are a few very important steps to consider in initiating your program:

1. Understand what you would like out of the program and how it can help you reach your strategic goals. This element, as well as nearly all of them listed in this article, has everything to do with the firm - better described as the partner - you choose to create and manage your program. Effective shop programs tie into the strategic corporate goals and cultural direction of the institution. If an institution for example lists “being a market leader in the service we provide our customers” as a portion of its mission statement, then service is a strategic goal and should be treated as any other competitive, finite strategy. “Service” should have its own ledger. Managers should be held to corporate goals through various measurement systems, communicate goals sufficiently, be given incentives to achieve goals, etc. This means that appropriate systems need to be developed to measure progress. A sound structure for feedback and communication of results is also required.

This type of information should be gathered in the discovery stage of the partnership with the firm you choose to assist you in your service venture. A sound, experienced firm will truly understand its client’s corporate culture and departmental goals. Questions from the firm should cause your individual management teams to truly think through every facet of how a program can, and will, help achieve corporate goals.

2. Develop metrics. Setting clear objectives is paramount in evaluating program effects. Customer service indexes, for example, are extremely effective metrics in benchmarking and cultivating service consistency. They can be tied to dynamics such as retention statistics, sales increases, profitability numbers and turnover ratios to paint a clear ROI picture.

These indexes include mystery shopping as a major component of real-time service provision. Realistically, what the program should do is create a cultural initiative throughout a branching network - it doesn’t simply measure who is shaking hands and who is not. Everything from merchandising to retention techniques can be driven to extreme levels with these types of indexes.

Of course, the way managers use the index is vital in the overall success of the program. This concept however, should be part of the initial discussions with the research/mystery shop firm you choose. That firm should have analysis capabilities at a minimum and understand how to make your numbers work for you. Additionally, the partner you choose should be experienced in providing management and coaching techniques based on the findings of your customized shop study. Simply put, their job is to make your study an easy-to-use management tool.

3. Analyze research design and training initiatives. The evaluation format, frequency and report translation and methods at the management level also play a great role in your program’s success. Your management needs to consider the optimum internal team to be involved in evaluation and scenario development. Your provider in turn should be able to tell you the types of data you should capture based on the specific needs of your institution as well as benefits of blind studies, benchmarking, point scoring, etc.

Also remember that consistency throughout each customer contact point is the goal here. Therefore, sending the same message, from e-mail correspondence to smiling frontline staff, means that everything should revolve completely around corporate training formats. The firm that develops the shop program needs to understand training procedures, expectations and goals. This lets managers use data in a meaningful, concise manner and gives insight on when and how to alter the program over time.

4. Consider administration structure. Select a firm that can help with the internal administration of the program after the development plan is constructed. To do this, the vendor must be able to work in tandem with either a single internal manager or an entire team from your institution. Your partner should know the answers to a variety of questions such as: Who needs to see what type of data? When and how would they like to see numbers? What additional types of exception reporting would be helpful? How will the results be used? Additionally, a provider that offers multi-level management of your shop study will be able to more fully evaluate how, or if, your institution is reaching maximum program benefits.

5. Facilitate team-building. Team-building causes team members to focus on goals and vision. If you would like better service and increased brand loyalty, you need better teams. If you would like better teams, you need to set goals, train, obtain buy-in, measure progress, coach and communicate results.

The key to this important element of your program is in creating superstar frontline supervisors. They are the true players/coaches and possess the greatest influence on daily service provision. Explained further, a branch manager effectively facilitating consistency - real day-to-day, hour-to-hour consistency - in high-level service provision is somewhat unrealistic. This is due to not only the number of daily duties and management tasks expected of the position but the simple fact that the manager does not work in the same arena, or trenches if you will, as most supervisory staff members do. Therefore supervisors have a much greater opportunity for coaching and reinforcing the service vision.

6. Promote communication. Strong communication between management and staff is essential in any cultural initiative and, certainly of high importance in the success of a shop study. An experienced firm acts as a conduit between the front line and the executive offices. This is done by providing knowledge and format to the front line as well as essential feedback to management on how to successfully coach to the staff’s strengths. A forum gets created where buy-in to the concepts and teamwork to achieve goals takes place.

The firm’s philosophy on what a shop program is, how it is developed, how it is used and how it helps to formulate culture needs to permeate the institution. Additionally, managers from the firm you partner with should be available for a variety of corporate meetings - from branch staff to executive staff - to describe program set-up, findings and how to improve.

Finally, a dedicated, internal staff member or team needs to be available to your shop company partner. As the relationship develops over the course of the study, communication channels become solidified, creating a seamless facilitation of your program.

Sound teams

As financial institutions continue the effort of doing more with less, the creation of sound teams who understand their institution’s defined customer service goals will produce the winners in the industry. A mystery shop initiative facilitated by a trusted partner will help your organization get there - bolstering your standing as the preeminent service provider in the markets you serve.