Challenges Faced In Customer Care Retention Business Essay

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1.0 Customer care, and retention , quality customer service output, exceeding customer expectations are regarded as crucial areas that create room for any success that's to be achieved by any business. (Macaulay and cook, 1994).

Since the issue of competition has become a global obsession, most companies need to create methods of strategy , separate from competing on just competition for price, in order to remain in the business circle. Providing outstanding customer care strategies is what most service industries would be reliant wholly upon to be able to be on a different level from their fellow competitors (200k, 2008) . First class customer service can be acquired properly by an organization by improvising measures to improve services provided to its customers through the provision of excellent service delivery exceeding customer,s expectation (Bergeron, 2002)

98 percent of unsatisfied customers will look for an alternative competitor without any complaint from them. (Galbreadth and Rogers ( 1999) while (Bove and Johnson , 2000) highlighted that totally satisfied customers are six times most probably to support a company's merchandise as unlike customers whom are just merely satisfied in mind. Also to add a slight reduction in defecting customers can result in overall profit increases.

By description, every business establishment has a main aim, of which is the ability to attract and hold on to their customers (Drucker and Levitt 1992). The estimated cost for a business to attract new customers is twice as it is to retaining already patronizing customers.

Therefore, one of the most effective service delivery procedures lies in managers' ability to design strategies that will enable the organization gain competitive advantage over rival firms in the business environment. (Dewit and Meyer , 2004) .

2.0 Literature review

In the world of today , the issus of the measures organizations can acquire for the improvement of service provision to its customers is still the main point when setting strategic missions and visions statements in today's emerging organizations, and it is heavily debated. (Mintzberg, H . et al . 1998).

In this regard, many academic literature in the area of strategic management have shown a number of competitive and non competitive strategic and operational models, befitting organizations which gives them room to gain competitive edge over their competitors.

The theory of Michael Porter is one of these strategies. He is a widely acclaimed and important theorist , and he came up with the positioning model. Porter (1985) highlights that competitive strategy not only responds to the environment, but also attempts to shape the environment. He argues that competition is encouraged by five forces in the external environment, which together are responsible for the returns of firms in an industry. They are the entry of new competitors, the threat of substitutes, the bargaining power of buyers, rivalry among competitors and the bargaining power of suppliers. In order to be able to maintain a competitive position in the business environment, porter (1985) further invented other strategies which he he showed that on embarking on these three generic strategies will allow an organization to to maintain its competitive strengths over other rival organizations. These strategies are : differentiation strategy, which is to have unique products or service over rival organizations, whilst on the contrary cost leadership strategy aims at acquiring quality products at relatively lower costs in the organizations line of business. And also the focus strategy which allows an organization to enable its production or service to a particular area where other rival organizations haven't emerged. Porter (1985) further states in his work that, the goal of competitive strategy for a business organization in an industry is to find a position in the industry where the company can best defend itself against these competitive forces or can influence them in its favour. The key strategy is to delve below the surface and analyze the sources of each. (Porter, 1998,pp4). Therefore an organization that's intent on low cost production in line with product differentiation can properly deliver quality service to customers.

Also , Barney (1991) strategy, which is also known as the resource inclined view which shows that an organizations competitive advantage is maintained by the improvement of its resources internally. He maintained that porters positioning model, is based on an organizations external environment and its performance on impact, which he agreed that it made clear our views on the external competitive environment. On the contrary, Barney (1991) diversed and implemented the resource view model which examines how empowering an organizations' internal resources can help in achieving competitive advantage. He placed the organizations resources into three namely, human capital, organizational resources and physical capital resources which (Barney 1991) went on to classify further into: the organizations knowledge, information, attributes assets, capabilities and organizational processes. Increasing these resources, therefore will either way increase the firms efficiency thus outperforming competitiveness in the business sector and eventually the strategies inevitably differentiates organizations resources and makes them hard to be imitated, which in essence helps firms to enlarge its efficiency as well as effectiveness (Barney, 1991)

An organization can possess and maintain competitive advantage through its core competence. (Prahalad and Hamel, 1990). According to them competitive advantage as a source can be found in the managements knowledge for the combination of corporate technology and skills production into competencies that will empower individuals business to adapt quickly to emerging opportunities (De wit and Meyer, 2004). Also, development of core competencies will enable an organization to stick firmly to quality as a core competence in the delivery of customer service, and hence possess and maintain competitive advantage.

From another point of view ( Kim and Mauborgne , 1999) argues that non competitive strategies also enables organizations to possess competitive. Their strategies were rather focused on a knowledge based economy rather than a resource or production based economy. They were able to implement the value - innovation strategy which makes an organization noteworthy and exceptional due to new services they put forward and with this competition turns out not to be an issue, thereby ruling it irrelevant. (Kim and Mauborgne ,1999) pointed that the imitation of other organizations serves as zero challenge but becoming creative by designing new products in which they thought to be unique.

Despite these strategies that were created to increase the service quality so as to become more dependable, there exists the possibility of gaps being present in an organizations service. This happens due to the fact that these organizations don't identify whether the service they provide is what customers really expect from them or even make attempts at surpassing customers expectations ( Zeithaml, Berry and Parasuraman, 1990) which eventually results to little or none improvement in patronage expectations, so as to be able to identify and correct these gaps between the customer perceived quality deficiencies, (Parasuraman, Zeithamel, and Berry, 1988) implemented a five dimension service quality measuring tool " servqual" which poses a set of the five important quality dimensions related to customer rankings. The tool also involves a set of 5 gaps that shows the difference between customers expectations and perceptions ( Parasuraman , Zeithhamel, and Berry, 1988) .

Servqual Model

Figure 1The SERVQUAL model for the confirmatory factor analysis (CFA)

Source. www.emeraldinsight.com/fig/0400220804001.png&imgrefurl

Fig. 1: The Integrated Gaps Model of Service Quality

(Parasuraman, Zeithaml, Berry 1985)

Source : www.marketing.org.au/?i=mhOLQLXYtU8=HYPERLINK "http://www.marketing.org.au/?i=mhOLQLXYtU8=&t=jZS6ngCVPug"&HYPERLINK "http://www.marketing.org.au/?i=mhOLQLXYtU8=&t=jZS6ngCVPug"t=jZS6ngCVPug=

Fig. 2: The 10 determinants of service quality (Parasuraman, Zeithaml, Berry, 1985).

Source : www.marketing.org.au/?i=mhOLQLXYtU8=HYPERLINK "http://www.marketing.org.au/?i=mhOLQLXYtU8=&t=jZS6ngCVPug"&HYPERLINK "http://www.marketing.org.au/?i=mhOLQLXYtU8=&t=jZS6ngCVPug"t=jZS6ngCVPug=

According to Parasuraman et al. (1988), the organizations ability for the identification of these gaps in their existing service and measurement of the actions necessary for improvement of their services with exceeding customer expectations through the delivery of first class services will constantly increase the performance in the organization in the competitive environment.

To be able to standardize performances and remain in business, the academic theorists have supplied important strategies which if properly managed , combined and acquired by organizations will serve greater purpose towards meeting desired targets.

2.1 Strategic choice

The research will compromise Porter,s (1985, 1988) competitive strategy in hand with parasuraman et al. (1988, 1990) Servqual gap model . They will be used to investigate the flaws in the service rendered by Union Bank of Africa, to customers , and suggested ways for the improvement of providing service to its customers.

2.2 Research question

How to improve, the provision of quality customer service in banking establishments. A case study of Union bank of Africa, Nigeria.

Research objectives

Investigating the packages in terms of service the organization provides for customers that makes them loyal either way.

Clarify the rationale of quality customer services in Banking establishments.

Looking through the strategies the organization uses for the improvement of customer service, so as to make them competitive in an enviable manner.

The usage of necessary research methods for data collection through interviews and recommendation of the necessary steps needed to close the gaps of the research results.

3.0 Research methodology

Research methodology is a pattern adopted for research which is based on the area of investigation as well as the research philosophy ( Saunders et al. 2007) .

3.1 Research philosophy

Research philosophy invariably relates to the nature of knowledge as well as the development of knowledge ( Saunders et al . 2007. Pp.101). So given the research question, how to improve the provision of quality customer services with the use of the social constructionism approach is done by the researcher.

According to Easterby - Smith et al. (2008) there are two major research philosophies the positivism and socio- constructionism which are supported by the ontological and epistemological assumptions. The ontological assumptions from the socio - constructionism view, believes that reality is not objective and its based on peoples perception of the world (Easterby - Smith et al, 2008). Also according to Saunders et al (2007) social interaction within social actors is a continuous process and must be in line for revision every now and then. Therefore the social constructionist view will be used as the philosophy aspect of the research, so as to be able to highlight the gaps in services provision by Union Bank of Africa to its customers, by the use of interaction socially between the service provider and its customers. Unlike the positivist view which its ontological assumptions argues " the reality we make about nature of reality's objective and external, (Seddighi, 2009). Therefore this approach will enable the researcher gain peoples perception on customer service (Saunders et al, 2007) and further find ways for the improvement of the service to an unbelievable expectation.

3.2 Research approach

Academic research consists of two basic approaches .They are namely inductive and deductive approach respectively. The inductive approach consists of a more flexible structure to allow room to change research emphasis as it progresses by having an understanding of the meanings that individuals attach to events ," ( Saunders et al. 2007) .

The deductive approach however is focused on scientific principles and transforming theories into sufficient data size so as to generalize conclusions (Saunders et al, 2007) .

The research will adopt the inductive approach. This will be used for the exploration, investigation and analysis of the highest level to which quality customer service can be acquired, improved and lastly delivered. As a result, qualitative data which is acquired by carrying out interviews will be interpreted to answer the research question and acquire the research objectives ( Easterby - Smith et al, 2008)

3.3 Research strategy

Research strategy is a general plan of how the researcher will go about answering the research question. It will contain clear objectives , specify the sources from which you intend to collect data and consider the constraints you will inevitably have". (Saunders et al. 2007 p.610)

The research will consist of focusing on a case study of a banking establishment, Union Bank of Africa. The research will be dependent on people's opinions, being that it's a qualitative research.

3.4 Data collection method and procedure

A qualitative approach with the use of interviews will be used for collection of primary data. This gives the researcher the chance to acquire a direct response to questions towards the subject area, since the sample size from the interview is considerably small. Interviews will be conducted in person , and over the phone as well.

The researcher will use interviews as a measure to collect data. Semi structured interviews will be conducted, with the data collected in a more structured way than the usual qualitative research (Saunders et al , 2007).

Therefore, the researcher will send the sample of the interview questions (Saunders et al, 2007) to Union Bank of Africa, before the interview and then eventually arrange the interviews date and time that's most preferred for individuals to be interviewed. When the interviews are taking place, the researcher will seek permission from individuals being interviewed to make notes of their responses and details provided and to record the entire interview on tape. This interview procedure is based on the interpretivist philosophy adopted by ( Saunders et al 2007) which provides an area for the researcher to explore the responses where additional information is required, as the questions will be open ended and will be conducted physically.

The researcher selected individuals in the form of employees from Union bank of Africa in Nigeria who are in position to aid the researcher in answering the research question and reach the research objectives.

The employees to be interviewed are:

Managing director of the company

The managing director of Union Bank of Africa is selected due to his long standing service in the banking industry, combined with the fact that he has been in service for over twenty two years and has a view on the customer service and intent of procedure on the improvement of provision of the services provided to customers.

Head of marketing division

The head of marketing is in charge of commercial, retail and consumer banking activities at the bank. With this he is in a position to offer information relating to the products that are provided to the customers. He is also able to measure whether they are necessary, as well as the marketing mix which is being used by the bank for the improvement of the products ,since there is always competition in the market.

Head of service quality management unit

The head of service quality management is responsible for the attention to customers' complaints, therefore as head he is aware of the gaps in services that are dished out to customers whom are social actors. He is also aware of their views, and perceptions on what they expect and what they should receive.

Manager

The manager is responsible for the activities in the bank that are assigned, so he is well aware of the demands present in case of systems slowliness during business hours and how customers will view and rate Union Bank because of this.

Customer service officer

This personnel has direct contact with customers and is sole responsible for the opening of accounts. He is also responsible for attending to the complaints of customers, as well as highlighting problems in customer accounts, thereby identifying the problems in the organizations service as regards customer expectations.

Also, secondary data obtained from the organizations website, customer service theories and journals, magazine articles, newspapers, and reports will be used to back up analysis of data collected. The use of secondary data will aid the researcher in structuring a clear picture of the company and the environment where it operates ( Saunders et al . 2007).

Semi - structured interview questions.

1 . What are the types of customer feedbacks that are received regarding the type of products and service quality being offered by your organization?

2 . With the present competitive business environment, how does your organization compare against other up and coming banking organizations ?

. What methods of reward exist for outstanding customer service officers, most notably those that have been lavished praise by customers?

The first question on the exploration of customer ratings and the opinions on the quality of services that are provided for them as well as whether the product choices are what customers are expecting as well as whether they are the right ones. As Parasuraman , Zeithamel, and Berry (1988) argued on services that organizations offer whether they are in line with what customers expect or even below expectation or above customer expectations.

The second question focuses on discovering the strategic measures the organization is using to benchmark competition in the external business environment which is in line with Porter,s (1985) positioning model which focuses on how the external environment responds and operates. And also to analyze the organizations core competence which Prahalad and Hamel (1990) pointed that it's the responsibility of the management of the organization to combine corporate technology and production skills into competencies that will empower individuals business to be able to adapt quickly to emerging opportunities.

The third question focuses around the issue of organizational policy on employee on employee motivation. Its main aim is discovering the organizational value of resources and the manner of encouragement towards employees for the delivery of quality service, particularly those whom are at the forefront, who represent the organization. The evolvement comes from Barney,s (1991) resource view model which argued that a firms resources helps attain competitive advantage as well as customer perceptions on staff that offer service to them ( Zeithhaml , Berry and Parasuraman, 1990).

3.6 Ethics

The university policy guidelines statement on ethics in research will be used for guidance and abided by students partaking in research and dissertations. Also individuals to be interviewed will be sent a consent letter. The letter will inform them the necessary details and purpose of the research, which their letter of response signed and sent by them will show their approval and consent to participate in this research.

Once the research is completed, Union Bank of Africa will have to receive a copy of the research. This is to be able to prove the data collected is authentic. This is for the researcher to show that he has considered moral issues ( Seddighi , 2009) which are very important in all academic research and therefore have complied with the ethics policy laid down by the University of Sunderland since the research will involve both individuals and Organizations.

4.0

In order to be able to analyze qualitative data, the researcher needs to recognize his data systematically for a rigorous and systematic analysis. ( Seddighi 2009)

In principle, the researcher will arrange the collected data from the reviewed strategic and operational management literatures and interviews response. They will then be transformed into transcripts and secondary data into understandable categories.

In order to critically analyze both primary and secondary data, the researcher will therefore simplify and summarize data gathered into : categorizing, unitizing data, recognizing relationships in order to draw , examine and verify if the relationships exist between variable and further draw conclusions that will enable the researcher to answer the research question/objectives ( Saunders et al 2007).

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