Calling Sue – Some Comments regarding the Questions
1. What were the gaps between the customers’ expectations and perceptions in the process
described?
There was a significant mismatch between customers’ expectations and perceptions, that is poor
perceived quality. Although the problems were eventually sorted out the events may have left a sour taste
in the mouth of the customer, making them even more wary of the bank and any future offers.
Looking at each of the gaps in turn:
Gap 1: The customer’s specification-operation’s specification gap
There does not appear to have been a mismatch between what we can assume to be the operational
specification (new cheque books within seven days, automatic transfer of balances, overdraft facility,
annual travel insurance, gold card and the use of a PBC), as promised by Sue, and the customers’
requirements. We do not, however, know what the internal specification was for these activities. It is
possible that the standards were not as needed, which would lead to such a gap.
Gap 2: The concept-specification gap
It is difficult to know if there was a mismatch between the service concepts developed by the bank and
the detailed specification of the products and services. One assumes not. The problem of which we are
acutely aware pertains to gap three.
Gap 3: The quality specification-actual quality gap
This is an important gap in this case. It appears that Sue was well aware of the problems that were often
incurred in these transfers; she referred to these ‘computer problems’ but later admitted to problems with
agency staff. Rather than warn the customers of the problems and setting appropriate expectations, she
had promised something that she knew would be difficult to deliver. Was this a good idea? Yes, in so far
as the transfer was undertaken and she kept the business, but ‘no’ in that she has created somewhat
dissatisfied customers who are now even more wary of their relationship with the bank and who may, if
they should experience another problem, terminate their valuable accounts.
It is important to remember that all the other parts of the promise (we assume) were kept – annual travel
insurance, gold card and so on. The problems that were experiences were only in the transfer process.
However, particular promises had been made about this, which were not delivered.
Gap 4: The actual quality-communicated image gap
One might argue that there was no mismatch here. The customers were extremely wary about
transferring their account because they had experienced problems with the bank in the recent past.
However, the communication they received from Sue provided them with the reassurance they needed to
make the decision, which as we know were rather hollow promises.
2. How were the customers’ expectations influenced from the outset?
The customers were wary of making the changes to their accounts. They had experienced several other
problems with the bank – remote and impersonal handling of their calls at a regional call centre, lack of
access to their ‘trusted’ assistant bank manager and different telephone numbers for the two types of
accounts. Their expectations were not high though they needed a solution to the problem that the bank
had created for them. Sue, however, had a significant influence on their expectations by explaining that
‘there will be absolutely no problem’ and that they ‘should get the new cheque books within seven days’.
They went ahead on the basis of trust.
3. What aspects of the bank’s service quality specification have been revealed to the customer?
Are these reasonable for such an account?
We can assume that the bank delivered on its promises to provide annual travel insurance, gold credit
card and a larger overdraft facility, and such specifications should appear to be quite reasonable for such
an account. The fact that errors are common at the processing centres due to the use of agency staff is
not appropriate for any type of account. The prime concern of the bank's customers is an error-free
service and this underpins customers’ relationship with the bank. The use of agency staff implies that the
bank is having problems dealing with demand yet consultants such as Sue are pressing clients to make
the changes, presumably trying to meet their own targets. This would suggest serious managerial
problems in terms of coordination, target setting and capacity management.
4. Evaluate Sue’s reaction to the problems at every stage. Was the bank’s service recovery
successful?
Problem
Sue’s response
One cheque book arrived after 9 days
Sue was not told of this problem.
Business accounts had incorrect
spellings and current account had
wife’s initials reversed
Sue apologized and ordered speedy dispatch of new
ones assuring customers that they could use the old
ones in the interim. She promised to confirm her actions
which she did.
The credit/cash cards arrived without
the PINs
Sue explained they would take a day or two.
One week later they still had not
arrived.
Sue apologized, checked her records and suggested
they had been lost in the post. Agreed to re-issue the
cards.
Names on envelope still incorrect, but
correct names on cheque guarantee
cards.
Next letter was correctly addressed.
Credit cards had expired and ATM
would not accept PINs for the original
cards
Sue apologized and sent a bouquet of flowers. She also
personally provided leather holders and cards and
cheque books.
Sue reacted as well as she could to each stage. The problems were systemic rather than personal, which
these customers seem to have accepted. Although they were dissatisfied during the process, Sue
appears to have done enough to appease them. Given that they have had no problems since, customer
satisfaction appears to have been restored; however, any further problems, small or large, might well
have led to a less measured response from the customers.
5. What costs have been created by these problems, and how do they compare with the
underlying costs and root cause of the problem?
The costs created by these problems include Sue’s time, though this is what she is paid for, the costs of
rework (reproducing and reissuing the cards and cheque books), the costs of compensation (flowers,
leather holders and delivery) and the costs to the customers (goodwill, inconvenience and
embarrassment). The root causes of the problems are poor capacity management, lack of communication
between departments and inappropriate target setting.
Some of these, in particular capacity changes, could be expensive to deal with and the recovery
procedures seemed to be being used to alleviate the problems in the short term. The critical issue is
whether the bank dealt with these problems in the long term.