I recently received a letter from my bank informing me of a number of changes to my current account terms and conditions. I don’t usually read the small print as more often than not the changes are to wording in the terms and conditions themselves rather than fundamental changes to the account. However, one of the changes particularly caught my eye and it was entitled ‘Service level guarantees’. My immediate reaction was to expect the bank to outline how it was committing to improving service levels but once I read, and then re read the text, that’s not what the letter said.
The opening sentence of the paragraph read ‘We are removing the Service Level Guarantees’. Not improving them or even raising them to a higher standard – just removing them. The paragraph went on to say how my right to express dissatisfaction or complain hadn’t been removed and how well established their procedures were to allow me to do this should I need to. Interestingly, they didn’t say exactly what the service level guarantees were so curiously, I dug out the terms and conditions booklet which I’d efficiently filed without reading. The booklet itself, whilst looking small, opened out to be 5 sides of uber small print containing 20.2 clauses, non of which as far as I could see outlined any service level guarantees. So I was left to phone the bank and ask them.
It transpires after a conversation with Bernadette, that the bank wasn’t removing service level guarantees. Confused yet? It was removing guaranteed financial payments for service level failures, the minimum being £15. So for example if the bank set up a standing order incorrectly or failed to issue a new card within the published timescales then they would automatically pay out. Instead, the bank would look at each incident in turn and judge whether a payment was warranted or not. I jokingly asked whether the removal of the automatic payments was because the bank were paying out a lot of money and were they trying to cut costs but that wasn’t the reason so Bernadette informed me.
Apart from the confusing and unclear wording on the letter. I’m not sure what I think about this. My initial reaction, based on part skepticism, part experience is that the bank were trying to wriggle out of it’s obligations to service level delivery, and in part I still think this. If the bank were truly focusing on service delivery, they shouldn’t be worried if occasionally they slip up and have to pay out on a previous commitment. I understand times and situations change and the need for review but attempts to change promises like these rarely provoke a positive response and can feel like an erosion of both brand and service. Interesting, this letter came to me in the same week the bank’s new Chief Executive announced the need to add £1.5bn to the balance sheet in part due to losses from 12 commercial loans (£900m) inherited in a building society take over in recent years. Coincidence I’m sure.
However, in fairness, having worked in financial services where service level penalties are common, and used in my experience for all the wrong reasons as a stick to beat up suppliers, they’re notoriously difficult to operationalise, to measure and manage and they tend to become the focus of too much attention. One such customer account had in excess of 80 service level measures, a number of which were deemed critical, upon which failure brought an automatic financial penalty wheres the rest worked on a sliding scale. The majority of measures and the data collection wasmanual which in itself was a cottage industry. Time that could have been better spent serving the customer. There was a palpable sigh of relief every month in the organisation when the results were published and all the traffic light measures were ‘green’. The opposite, if any were red not to mention the pressure and fear they created internally -not a great climate to work under. It also drives cost up which ultimately gets passed onto the customer so they loose there too. If the bank gets something wrong, just put it right – quickly and efficiently.
As a customer, I’m not really interested in guaranteed financial penalties. If I was in a supplier relationship I might want financial penalties for service level failures, but personally I don’t think it drives the best behaviour or cultivates the right relationship. So removing something I wasn’t aware of existed is no bad thing but it does make me question the reason why, which in turn makes me trust the brand less and introduces doubt, and that’s not what I’d be setting out to achieve if I was the bank, given the current climate.