The idea of having a Personal Banking Consultant (PBC) seemed a great one at the time it was
suggested. For a modest annual fee we would get a differentiated range of \u2018relationship\u2019 financial
services designed for busy business people like us. These were listed in an attractive glossy
\u2018membership\u2019 brochure and included a larger overdraft facility with preferential interest rates,
free annual travel insurance, a rewards point scheme, a \u2018gold\u2019 credit card with no credit limit and
our own PBC (Sue) and her personal assistant (Richard), who would be there to help whenever
we needed them. Every other aspect would be as before, but our accounts would have to be
transferred from our old branch in the south (where we lived until six years ago, but never
bothered to move our accounts) to the north, where we now work. Having a remote bank branch
had not been a problem until recently. If we needed anything done with any account, we simply
had to ring the Assistant Manager in the south and he arranged it. But recently, a Southern West
Region Office was established, and all phone calls were handled remotely, so it had become more
difficult to maintain this personal relationship. Moreover, separate people at different offices,
using different telephone numbers, handled our business and private accounts. We were ready for
Despite the attractions of the package described, we were hesitant to accept this generous offer.
Changing all the cheque books, credit cards, standing orders, direct debit instructions and
anything else we had forgotten, including our personal and business accounts, seemed rather
complex and time consuming. We raised these concerns with the advisor who had been sent to
sell us the idea, one dark December Monday.
\u2018Oh, there will be absolutely no problem ... we can deal with all that. All you and your wife will
have to do today is to sign a few forms authorizing us to transfer the accounts, and one to agree to
the new arrangements. Then leave the rest to us. There will be no problems, it\u2019s easy with all the
technology we have today. You should get the new cheque books within seven days, and all
balances will be transferred automatically by the computer\u2019.
We signed up immediately \u2013 it looked a good scheme, and even the value of the free insurance
alone would more than compensate for the annual membership fee. The four cheque books for
the two accounts arrived separately, over a three-day period, the last arriving on the Tuesday,
nine days after the agreement. The business account cheques had an incorrectly spelt business
name, and the current account cheques had my wife\u2019s initials reversed. At the same time, we
received (from Sue) a personalized welcoming pack and a professionally presented loose-leaf
folder of information concerning the account and PBC services, which confirmed that the
accounts were in operation. All this correspondence was correctly addressed and written in a
friendly style, using our first names. I decided to call Sue about the spelling.
\u2018I\u2019m awfully sorry, sir, I\u2019ll order some new ones, and I will ask them to send them to you quickly.
I know they\u2019ve had a backlog due to computer problems at the card centre, but they can prioritize
any PBC\u2019s cards. In the meantime, you can use your existing accounts, since they are linked to
your new ones. I\u2019ll call you to confirm when this has been done. Again, may I apologize for any
inconvenience you have experienced.\u2019 One hour later she rang as promised, confirming her
On the tenth day our credit cards arrived, correctly embossed with our names. However, these
could not be used for cash withdrawals without personal identification numbers (PINs) and the
cheques could not be used in UK retail outlets without cheque guarantee cards. The cheque
guarantee card doubled as a cash card, for use at ATMs with another PIN number. Neither PIN
number had arrived by the second Friday after our signing-up (11 days). I decided to call Sue, to
see what was happening.
By the following Friday lunchtime, returning from a week\u2019s business trip, we were getting
concerned. Although our new cheque guarantee cards had arrived and were correct, our names on
the envelope were again incorrect, which seemed odd and slightly disconcerting. We still had not
received the new PIN numbers. I decided to call Sue, who apologized again, politely expressing
her amazement at our dilemma, and asked me to hold while she checked the system.
\u2018They have certainly been correctly issued on Monday\u2019, she said confidently, \u2018and have been sent ... perhaps they have been lost in the post. I\u2019ll check with the card centre what we should do, and I\u2019ll call you back.\u2019
Her suggestion seemed okay at the time, but proved to be rather more of a problem than we had
anticipated. On checking out of the hotel on Monday evening, we discovered that the existing
credit card had expired, and the bill came to more than our existing cheque guarantee card limit.
We settled the account with a combination of cheques and most of our remaining cash \u2013 an
embarrassing end to a pleasant weekend.
In the post on Tuesday morning, we were surprised to receive two sets of PIN numbers, along
with further cheque guarantee cardsand credit cards. We went to the ATM with our new cards to
draw out much needed cash, but the PINs were not accepted. Careful examination of the
packaging revealed that the PINs related to the original cards, not the replacements! We
borrowed cash from a friend and called Sue!
By Friday, everything was working and we had received a correctly addressed letter of apology
from the card-issuing centre in Glasgow. An excellent bouquet of flowers was delivered that
afternoon and Sue phoned to check we were now happy. She even called in to see us a week later,
bringing some leather holders for cards and cheque books. We have had no more problems and
generally the service is excellent. Sue has, however, confided that such problems are quite
common (they apparently use a lot of agency staff in the processing centres, and mistakes are
But we can always call Sue.
1 What were the gaps between the customers\u2019 expectations and perceptions in the process
2 How were the customers\u2019 expectations influenced from the outset?
3 What aspects of the bank\u2019s service quality specification have been revealed to the customer?
Are these reasonable for such an account?
4 Evaluate Sue\u2019s reaction to the problems at every stage. Was the bank\u2019s service recovery
5 What costs have been created by these problems, and how do they compare with the underlying
costs at the root cause of the problem?
There was a significant mismatch between customers\u2019 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
Looking at each of the gaps in turn:
Gap 1: The customer\u2019s specification-operation\u2019s 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\u2019 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
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 \u2018computer problems\u2019 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 \u2018no\u2019 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 \u2013 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
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