Business at work assignment on alliance and Leicester.
Business at work assignment on alliance and Leicester.
Assignment On Alliance And Leicester For Business At Work - Unit 1
The objectives of Alliance and Leicester are:
Ø To provide a wider range of mortgage investment, personal banking and insurance products [car insurance, home insurance etc], cash transmission services [making the money more accessible to the customer] and corporate banking facilities that is high in quality and competitive in price.
Ø To increase the value of the stock [shares] the shareholders have in Alliance and Leicester. [To grow shareholder value].
Ø To become the most customer focused financial services organisation [To always put the customer and their needs first].
Ø To train their staff and to invest more in the training of their employees.
Ø To build a more efficient and customer focused organisation.
Ø To make a larger profit then in 2000.
Ø To make larger cost savings by the end of 2003 based on the cost savings of 2000.
Alliance and Leicester are achieving these objectives by making sure they put the customer first by making their products available through a larger range of convenient ways to their customers. Such as Internet banking, ATMs and branches. This is followed by a high quality of personal service. Alliance and Leicester have increased the number of staff in their call centres and branch network and as this is where the staff of Alliance and Leicester comes face to face with the customers they have in the past 12 months refurbished 48 of their 319 branches. This means that about 40% of the Alliance and Leicester branch network has been upgraded in the last 4 years. Alliance and Leicester have also introduced point of sale decision making for unsecured personal loans into their branches so personal loan application customers can get an answer straight away.
In the past couple of years Alliance and Leicester have focused more on selling to their existing customers. There objectives are also being met by them delivering on their strategy, which they set out in July 2001.
To Alliance and Leicester the development of their staff is an important part of their strategy so they 2000 are providing more training per staff member and their initiative f or 2000 is for all the groups' employees to attend a 2-5 day training course called Valuing Individual People [VIP]. The majority of the groups' customer services areas such as the branch network have Investors In People accreditation. 84% of the group's customer facing staff are covered by IIP [Investors In People] status.
Alliance and Leicester want to build a more efficient and customer focused financial organisation and they have taken the first steps to achieve this by restructuring the group enable them selves' significant costs and allow efficiency improvements. They are also introducing a new group-wide technology architecture, which will provide better customer service and reduce costs.
Alliance and Leicester made a pre-tax profit of £396 million reflecting the £85 investment in groups strategy, £13 million investment in building their small business banking division and £14 million in loan loss recoveries and in addition to all this the group has made a one-off profit of £12 million from the rationalisation of London properties. In 2000 shareholders got a return dividend of 33.0p per share and they have increased this by 10% to 36.3p per share. The total shareholder return for was 11.0% and in 2001 it increased by more then half at 23.5%.
Alliance and Leicester are on their way to achieving their target of greater cost savings by the end of 2003 based on the cost savings of 2000. They have made annualised cost savings of £20 million in 2001 based on 2000 business volumes and prices.
Alliance and Leicester is a Public Limited Company or a Plc. A public limited company is a business owned by shareholders. The shares in a plc can be sold on the stock exchange. A plc has limited liability which means that if the shareholders have paid the full amount due for their shares and the business fails they are not required to pay the debts of the business, they can not be held personally responsible for the failure of the business. A plc has a separate legal personality from the owners and the people running it. The directors of a plc can not be sued for something that is the responsibility of the company and the company can not be sued for something hat is the responsibility of a director or a director has personally done.
The advantages of Alliance and Leicester being a plc are:
Ø Shares in Alliance and Leicester can be sold on the London Stock Exchange and the main advantage of this is that large amounts of capital can be raised very quickly and be invested in the group's strategy and in building up their small business banking division.
Ø Alliance and Leicester being a plc means they can easily raise capital to train their staff. The VIP [Value Individual People] programme is the largest single investment Alliance and Leicester have made in training their staff.
Ø The directors of Alliance and Leicester can make decisions in the best interests of the company knowing that if something goes wrong and the company fails they might be held personally responsible but will not be held financially responsible as a plc has limited liability.
Ø Alliance and Leicester being a plc also means that they have the capital to employee extra customer facing staff for their call centres and branch network which helps them in achieving their objective of becoming the most customer focused financial services organisation.
The disadvantages of Alliance and Leicester being a plc are:
Ø That the control of the business can be lost by the original shareholders if large quantities of shares are bought as part of a take-over bid by another financial organisation such as Lloyds TSB.
Ø Alliance and Leicester is a member of the FTSE 100 Index of leading shares but selling shares on the stock exchange can mean having good days when most people want to buy shares and bad days when most people want to sell shares.
Alliance and Leicester being a plc means that all the decisions are passed by the shareholders at Annual General Meetings [AGM] which means that all the decisions take longer to be made and plans are slow to be put into motion.
These are the functional departments that exist within Alliance and Leicester:
The Customer Services Department is the department that helps meet the needs of the customers. Develops customer services and helps to discover what the customers want and then deliver to them what they want.
Human Resources Department is the department responsible for a variety of other things within the department such as looking after the welfare of the staff, acting as a mediator between trade unions and managers. They make sure the right wages are being paid and that employment laws, discrimination laws and health and safety laws are being met. They also help to make policies that cover the organisation and how important the staffs are to the organisation.
The Computer Technology Department is the department that is responsible for all of the on-line services. They create new services to make their products and services more accessible to their customers and then manage all the services to make sure that their staff and customers have no problems using the services.
The Finance Department is the department that deals with all the money coming in and all the money going out of Alliance and Leicester. This department is also known as the accounts department and must keep a detailed record of all the money coming in and going out of the business or recording financial events as they happen and present the final balance sheet, sources and use of funds, profits and loss account and other financial records at the Annual General Meetings [AGM]. They also do the calculations for the wages of the staff. The finance department can stir the business to certain directions based on their analysis of the financial figures. The finance department also controls how much the business can spend on certain things and what targets the business needs to achieve.
Marketing Department is the department that helps promotes the organisation, its products and services. It is responsible for identifying, participating and satisfying the needs of the customers. Marketing and sales are most often the same but there is a difference between the two departments. Marketing is responsible for getting the business to provide what the customers want and sales get the customers to want what the company is providing. The Marketing Department research to find out who makes up a particular market, what they want, where they want it and at what price. Other examples of what marketing does are advertising, packaging, promotion, distribution and pricing. The marketing department also increase the number of products and products available to the customer.
An administration Department is the department that keeps all the paperwork in order. Every large organisation depends upon an administrations department to deal with enquires, communication between the departments and producing documents for the staff. The central administrations office is responsible for controlling the most important aspects of the organisations paperwork. This department also deals with filling documents, sorting the companies mail, word processing, and maintaining the databases.
The functional departments help Alliance and Leicester to achieve their objectives.
To Alliance and Leicester the Customer Services Department is one of the most important departments because it's the department that helps them achieve one of their objectives to become the most customer focused financial organisations and to become more efficient. The Customer Services Department do this by inprovinging the number of products and services available to the customers and also help to increase the number of staff that deal directly with customers.
The Human Resources Department train all the staff to make sure that they have all the right skills to deal with each customer's individual needs. They also help Alliance and Leicester to invest their money into training programmes like V.I.P [Valuing Individual People] that help to develop the skills of their employees. The V.I.P programme is a 2-3 day training course and it aims to train staff delivering excellent customer service across the group. So this department is helping the group achieve it's objective of educating and developing their staff.
The Finance Department are responsible for keeping all the accounts of Alliance and Leicester in order, which means that all the money coming in or going out of Alliance and Leicester has to be justified. This is the department that keeps all the shareholders informed of the changes in share prices. This is also the department that decides how much can be paid in wages. If new staff can be hired and how much money Alliance and Leicester can invest in new projects such as training courses for the staff and new technology to improve customer service. They ...
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The Finance Department are responsible for keeping all the accounts of Alliance and Leicester in order, which means that all the money coming in or going out of Alliance and Leicester has to be justified. This is the department that keeps all the shareholders informed of the changes in share prices. This is also the department that decides how much can be paid in wages. If new staff can be hired and how much money Alliance and Leicester can invest in new projects such as training courses for the staff and new technology to improve customer service. They are also responsible for paying taxes, bills and any other costs.
The Computer Technology Department have introduced a new market-leading Internet application and case-tracking service for mortgage intermediaries. The department is piloting sub-brands to support the sales of key products. These are brands such as "Movingimproving" for mortgages and "Smartmotoring.com" for the sales of car related products and loans or finance for cars. They have also set-up a computerised mortgage application system called ISIS, which lets the staff receive fully credit scored decisions on-line in 60 seconds. The system shows relevant information without the staff having to re-key details in to the computer and the system also allows the staff to track the progress of their customers application on-line. This helps the organisation to be more efficient and saves the customers time, which makes the customer feel good. So this department helps the organisation to be more efficient and customer focused.
QUESTIONAIRE ON ALLIANCE AND LEICESTER
) In which department do you work in?
BANKING
2) In general how many departments are there?
THREE
3) How many memos do you receive in a week?
One Two
Three Other
4) How many staff grades are there in your Department?
THREE
5) Do you always feel that the company always lets you know in plenty of time what is going on within the company?
Yes No
6) In general does your manager ever discuss work problems with you?
Yes No
7) How often do you come across a problem at work, which has to be referred to the manager?
Very rarely Rarely
Often Very often
8) Are your views and opinions listened to and acted upon?
Yes No
9) Are there lots of rules and procedures you have to follow?
Yes No
0) Generally how many grades of promotion are there to get to head Of Department or Department Manager?
TWO
1) How many managers do you have to answer to outside the branch?
One Two Three Four Other
2) How often do you talk to members of other departments or branches?
Very rarely Rarely
Often Very often
Conclusion For Alliance And Leicester Questionnaire
In the Alliance and Leicester branches there are generally two departments with most of the staff working in banking, which means they have customer-facing roles. The branches receive more then three memos in a week that shows that the culture of the business may be bureaucratic or role culture. Bureaucratic or role culture is when each member of staff has a permanate job role and their empowerment depends upon their position in the organisation. There are rules and regulations because of the large amounts of money that are dealt with and also because of the risks involved in selling financial products like insurance. There are lots of rules and procedures that the staff have to follow which shows that the group are very careful about what they are selling to their customers and that they don't mislead their customers in any way especially when selling them insurance and mortgages.
There are three grades in each department. A flat structure is very unusual for an organisation the size of Alliance and Leicester but this could only be in the branches although Alliance and Leicester are reviewing the jobs of all their staff so that the whole organisation from head office through to the branches has a flat structure.
The company always lets their staff know in plenty of time what is going on within the group which shows good communication and that they have a flat structure. Good communication is most often not a part of role culture because everyone has their own job to do so there isn't much need for the staff to communicate with each other, which shows that the managing style is democratic In general the manager discusses work problems with his staff.
This is when the views and opinions of the staff are taken into account. The staff rarely come across a problem at work, which needs to be referred to the manager, which shows that the employees are empowered to deal with problems on their own. Empowerment isn't usually a feature of role culture. The views and opinions of the staff are listened to and acted upon which means that the managing style isn't authoritarian. There are three grades of promotion to get to head of department or department manager and the staff only have to answer to one manager outside the branch this also shows that the structure is flat. The staff often talk to members of other departments or branches.
A flat structure, democratic managing style and empowered employees are all part of task culture. Bureaucratic managing style, poor communication, slow decision making and a tall structure are all part of role culture.
The management style of Alliance and Leicester is democratic. The managers of Alliance and Leicester always encourage their staff to give their views and opinions. Alliance and Leicester believe that democratic leadership is the best way of managing their staff because if they can involve their staff in making decisions then their staff are likely to be more committed to their jobs and therefore motivated to doing their jobs to the best of their abilities. This also helps the managers because they can use the experiences and knowledge of their staff to make decisions that are in the best interests of the business and the staff. People now expect more freedom and a better quality of working life because of higher educational levels and rising income levels. There are also bad points to democratic management. The manager's job is made harder because they have to be very good listening and communicating with the staff. It takes longer to make decisions as the views and opinions of the staff have to be considered before decisions are made and can sometimes lead to a difference of opinions amongst the staff. It could also be that some of the staffs don't have the experience and knowledge of the business to contribute to the decision-making.
The democratic managing style of Alliance and Leicester has a major impact on the performance of the business. The democratic managing style means that the staff are empowered to deal with customer complaints much quicker and easier as they can make decisions that they think will best suit the customers as the staff at the branches have very similar lives to their customers they will better understand their needs and so are better equipped to make decisions that are in the best interests of the organisation but also fair to the customers.
The culture of Alliance and Leicester is a mixture of task and role this is because each staff member has their own particular job to do but can make decisions on their own they also have more then one manager which is a feature of task culture and the partly decentralised, which means the staff are empowered to make decisions but the manager still retains responsibility. The culture of Alliance and Leicester being a mixture of task and role is that it helps the organisation to keep a flat structure. Role culture is most often associated with a tall structure but because of de-layering and team work (task culture) and wanting to improve communication and customer service task culture is taking over. There is mostly role culture in the head office and task culture in the branches. The decision-making in the finance department is centralised because of the large amounts of money and risks involved. There are lots of advantages to Alliance and Leicester having a decentralised culture such as it takes of pressure of the managers and improvers staff morale. Customer complaints are dealt with much faster because they don't have to be referred to the manager, which leaves the manager to attended his/her other responsibilities and sometimes staff have a better understanding of local issues and conditions. By staff helping managers to make decisions they are gaining experience, which could help them take over the managers jobs when they move to a higher position. Alliance and Leicester is a large organisation, which means that it also has a bit of bureaucratic culture. This means that each member of staff has a permanent job role and the power each staff member has depends upon their position within the group.
The organisational structure of Alliance and Leicester is based around their three primary customer groups:
Ø Retail Banking - This is cash handling for retailers and other small businesses. This group also operates Alliance and Leicester Business Banking offering banking services to small businesses.
Ø Commercial Banking - this covers most of all the products and services offered by Alliance and Leicester. These are a broad range of products and services offered to personal customers and this group is run as a single management unit.
Ø Distribution - This is how the product and services of Alliance and Leicester are made available to their customers through ATMs, the branch network, on-line and also through their call centres.
Alliance and Leicester have simplified their business by altering the organisational structure and staffing profile, which meant reducing the number of managers and reviewing the non-customer facing roles within the group this is also known as de-layering and this helps the organisation keep a flatter structure. A larger number of the group's employees have been promoted to undertaking roles that deal directly with the customers, which means that the staff is more empowered to make decisions and to deal with customer complaints. In October 2001 the Group Board agreed a restructuring of the responsibilities of the Executive Directors and under the revised structure the role of the Group Managing Director no longer existed and he resigned by mutual consent. This will save the group money in wages amongst other things. Alliance and Leicester has a flat structure and the managing style within the group is democratic which means there is good communication between the staff and managers.
The flat structure Alliance and Leicester means that more ideas come from the staff which could lead to the development of new products and services or the improvement of the old ones and the entrance into new markets which could lead to an increase in sales and therefore profits would increase. The money Alliance and Leicester are saving from not having to pay middle managers and junior managers lowers costs, that in return lower prices and increases sales and so profits go up. Staff morale is a lot higher which makes them more committed and this improves customer service. All these things help Alliance and Leicester meet their objectives of better customer service and increasing profits. The staff being more committed results in quicker decision making, quicker response to any type of change whether in the organisation itself or in the banking sector as a whole and this also allows the business to respond quicker to customer demand.
The flat structure of Alliance and Leicester has a major impact on the performance. The flat structure means that the organisation saves on wages amongst other things and the money they save can be used to develop new products and services, which would attract more customers, and this will increase profits. They can also use this money to further train their staff in customer care, which would add value to their products and services. A flat structure also improves communication between the staff.
The decentralised culture of Alliance and Leicester means the staff are able to gain or develop their decision making skills which could help them when are promoted and this helps Alliance and Leicester meet it's objectives of educating, developing and always making sure that their staff are happy. If the Staff are happy then they are likely to take better care of the customers and this gains Alliance and Leicester a good reputation. Responses to changes or competition are made much quicker and complaints are dealt with a lot faster which also improves customer care and goes on to increase profits. This also makes the organisation more efficient which is one of the group's objectives.
The decentralised culture of Alliance and Leicester has a major impact on its performance. The decentralised culture means that the staff can make decisions themselves without having to inform the manager about every little decisions that has to be made which gives the staff a sense of importance and motivates them to become even more committed to their jobs. The staff making the decisions leaves the Managers to take care of the really important things like monitoring the progress of their benchmarking standards and so on.
The democratic management style of Alliance and Leicester means that the staff are more motivated and committed because they are being listened to. If the staff are committed then they are doing their jobs better and that helps to avoid mistakes, which could cost an organisation like Alliance and Leicester millions in damages.
The structure of Alliance and Leicester is flat and the management style is democratic which means that the managers are always ready to listen to the views and ideas of their staff and this leads to a decentralised culture that is very informal. Management and control are based on consultation this is when managers consult their staff about decisions and take their views into account before making the final decision and not on persuasiveness this is where the manager has made the decision but takes the time to persuade the staff that its a good idea. This is how the structure, culture and management style of Alliance and Leicester interrelate.
ALLIANCE AND LEICESTER QUESTIONAIRE ON COMMMUNICATION.
IS THERE NEW ICT SYSTEMS BEING INTROUDECED?
NEW SYSTEM INSTALLED 3RD DEC 2002
WHAT KIND OF SYSTEMS ARE THEY?
NIXDORF 420 PRINTOR
FLOXSCAN L 375
COMPAQ ITTEL PONTINUM 4
DO THEY HELP CUSTOMER SERVICE?
YES THE NEW SYSTEMS HELP CUSTOMER SERVICE.
HOW DO THEY HELP CUSTOMER SERVICE?
IT PROVIDES QUICKER SERVICE FOR THE CUSTOMERS.
ARE THE STAFF TRAINED TO USE THE NEW SYSTEMS?
YES THE STAFF ARE TRAINED TO USE THE SYSTEMS.
HOW HAS THE STAFF BEEN TRAINED TO USE THEM?
THEY HAVE BEEN PROVIDED WITH TRAINING COURCES AND IN HOUSE TRAINING.
ARE THE SYSTEMS MORE EFFICIENT?
YES THE SYSTEMS ARE MORE EFFEICENT.
IS IT QUICKER AND EASIER TO FIND CUSTOMER DETAILS?
YES IT IS.
WHAT ARE THE ELECTRONIC METHODS OF COMMUNICATION WITHIN THE COMPANY?
THE TELEPHONE AND COMPUTER SYSTEMS.
WHAT ARE THE BEST METHODS OF COMMUNICATION?
THE TELEPHONE AND COMPUTER SYSTEMS.
WHY?
DIRECT CONTACT WITH HEAD OFFICE.
HOW DO THE BRANCHES COMMUNICATE WITH HEAD OFFICE?
THROUGH THE COMPUTER SYSTEMS.
HOW DOES HEAD OFFICE COMMUNICATE WITH BUSINESSES THEY HAVE PARTNERSHIPS WITH?
THROUGH THE COMPUTER SYSTEMS, TELEPHONE AND LETTERS.
HOW DOES THE COMPANY COMMUNICATE WITH CUSTOMERS?
THROUGH LETTERS AND COMPANY REPORTS.
HOW DOES THE COMPANY COMMUNICATE WITH THIR SHAREHOLDERS?
THROUGH LETTERS AND COMPANY REPORTS.
DO THE STAFF WITHIN THE BRANCHES USE ICT TO COMMUNICATE WITH EACH OTHER?
NO THEY DON'T.
HOW DO DIFFERENT DEPARTMENTS COMMUNICATE WITH EACH OTHER?
WITH MEMO'S, LETTER'S AND VERBALLY
WHAT PROPORTION OF ICT IS USED FOR FORMAL COMMUNICATION?
50%
WHAT PROPORTION OF ICT IS USED FOR INFORMAL COMMUNICATION?
50%
WHAT PROPORTION OF ICT DO YOU USE TO COMMUNICATE WITH STAFF UNDER YOU OR MANAGERS ABOVE YOU?
20%
WHAT PROPORTION OF ICT IS USED FOR COMMUNICATION BETWEEN STAFF IN THE SAME DEPARTMENT OR STAFF IN DIFFERENT DEPARTMENTS?
25%
IS ICT USED TO CONTROL PRODUCT OR SERVICE QUALITY?
Yes. SERVICE QUALITY.
HOW IS IT USED TO CONTROL PRODUCT AND SERVICE QUALITY?
INDETFY CUSTOMER DETAILS I.E NAME + ADDRESS + D.O.B ETC
WHAT DO YOU THINK ARE THE BENEFITS OF THE COMPANY USING ICT?
IT IS MUCH FASTER AND CAN PROVIDE MORE INFORMATION.
WHAT DO YOU THINK ARE THE DIADVANTAGES OF THE COMPANY USING ICT?
THERE ARE NONE.
DO YOU THINK THE NEW SYSTEMS ASSURE GOOD QUALITY PRODUCTS AND SERVICES TO THE CUSTOMERS?
YES THEY DO.
THANK YOU FOR TAKING THE TIME AND DOING THIS QUESTIONAIRE.
Conclusion For Alliance And Leicester Questionnaire On ICT.
There was a new ICT system introduced on 3rd of December 2002. The systems are Floxscam lL375, Compaq Intel Pentium 4 and Nixdorf 420 Printer. The new systems help customer service by providing a quicker and more efficient service. The staff are trained to use the systems. The staff have sent on training courses and provided with in house training. The systems are more efficient and t is quicker and easier to find customer details, which also saves the customer time.
The electronic methods of communication within the company are the telephone, e-mail and computer systems. The best methods of communication are the telephone and e-mail because they are quick and easy to use the telephone is two-way and has direct contact with head office. E-mail is almost two way as you have to wait a few minutes for a reply but it does have direct contact with head office. The branches communicate with head office through the computer systems. Head office communicates with businesses they have partnerships with through letters, e-mail and telephone. Alliance and Leicester communicate with their customers and shareholders through letters and company reports. The staff that work within the branches don't use ICT to communicate with each other. Different departments communicate with each other verbally and through memos and notices. 50% of ICT is used for formal communication. 50% ICT is used for informal communication. 20% of ICT is used by the manager to communicate with staff under him and managers above him. 25% of ICT is used for communication between staff in the same department or with staff in different departments.
ICT is also used to control service quality. ICT controls service quality by identifying customer details much faster and the systems are able to provide more information. There are no disadvantages to the organisation of using ICT. The new systems assure good quality products and services for the customers.
ICT [Information Communication Technology] has had a great impact on the internal and external communications within Alliance and Leicester. ICT is very advanced which means that the speed of communication is improving all the time.
The forms of internal communication that Alliance and Leicester use are:
Ø Databases
Ø Meetings
Ø Memos
Ø Notices
Ø E-mail
Ø Telephone
Ø Talking face-to-face
These methods are used for communication:
Ø Between employees - to pass on messages and customer details.
Ø Between departments - to pass on information and customer de3tails.
Ø Between managers - to discuss problems and improve service.
The forms of external communication that Alliance and Leicester use are:
Ø Internet
Ø Interviews
Ø Company report
Ø Video teleconferencing
Ø Direct mail
Ø Fax
Ø Advertising
Ø Letters
Ø Telephone
They use these methods to communicate with:
Ø Customers - about bank statements, credit card payments, mortgages, changing interest rates, car and home insurance.
Ø Shareholders - about AGM's, company reports and the change in share value.
Ø Local community - about charitable events they are sponsoring and about products and services they offer.
Alliance and Leicester use databases that are protected by passwords. There are two types of network security user-level security and share-level security. In user- level security every user is given a user name and password and both have to be entered correctly before access is gained to the network. When the user has logged on to the network there are restrictions as to what the user can see or alter on the network. Share level security is when each resource available on the network has it's own password. There are two passwords one which allows full access to all financial records, customer files and any other databases. The other password allows the user access to information that they are required to see. A problem with this system is that employees have to remember lots of different passwords and if they write them down then the security of customer accounts and records could be breached. A simple mistake like this could cost Alliance and Leicester millions of pounds. Financial services through the Internet allow customers to make transactions round the clock from anywhere in the world. Internet banking systems like the ones Alliance and Leicester has in place are well secured to prevent unauthorized access and safeguard the integrity of the data keeping it safe from hackers.
The negative and positive impacts that ICT has had on Alliance and Leicester are that communication methods like video-conferencing can be very expensive but using a method such as this can be very useful as meetings between directors can take place from any where in the world at any time and this helps to make decisions much faster. The faster a decision can be made the better it is for the business in terms of competing with their rivals. E-mail and text messaging are the quickest and easiest methods of communication along with telephones although not every one can use e-mail and text messaging and would need training to do so. Memo's and notice's are very quick and easy to use but no one really pays much attention to them and it isn't two-way communication. Telephones are a great method of communication as it's two way and if one person doesn't understand they can ask questions and it's quick and easy to use but the other thing is that a permanent record of the communication can't be kept. Alliance and Leicester has already experienced certain changes such as computerization of all financial transactions and the introduction of the automatic teller machine [ATM]. Alliance and Leicester has a great deal of interest in the new developments in banking technology because if the technology is better then they can offer a wider range of services to their customers and be more competitive both locally, nationally and maybe internationally in the future.
Communication is becoming faster and easier all the time. Which means that people have to work harder and faster to keep up with the flow of information. Network databases have replaced filling, which means that looking for customer's accounts or details is a lot quicker and faster. Alliance and Leicester use computers to control the credit of their customers, recording payments and preparing invoices. With most customers banking over the Internet or by telephone it is easier for Alliance and Leicester staff to service customers and this also cuts costs. Alliance and Leicester sell home and car insurance through the Internet along with mortgages. Customers can also bank over the Internet. Shareholders can also view the company reports for the present and previous year and financial summaries for the last couple of years. There is a section about frequently asked questions and where you can find you're nearest Alliance and Leicester branch. There are also contact numbers and addresses available for anyone who wants to make any other enquires.
Alliance and Leicester use the Internet to communicate with their customers, shareholders, employees and potential customers. Alliance and Leicester advertise on the Internet. Anyone can log and see what kind of jobs are available within the organisation and they can also apply, on the website. Alliance and Leicester offer motor finance; mortgages, loans and customers can also buy and sell shares through the Internet. More than 3.2 million customers visited Alliance and Leicester during 2001 and we received more than 85.000 product applications from personal customers over the web. More than 10% of applications for credit cards and personal unsecured loans are now received directly from the Internet. Alliance and Leicester also launched a website called ''Smartmotoring.com'', it's a one-stop shop for anyone interested in buying or selling a car. Alliance and Leicester also offer movingimproving.com to cover a variety of services related to mortgages and housing. The website offers house-buying and do-it-yourself advice.
Alliance and Leicester are still looking to improve the application process for their mortgage and personal products. They have also enhanced services for all their current account and savings accounts customers who want access their accounts through the Internet. Alliance and Leicester are also developing a virtual contact centre integrating telephone and Internet channels this will improve customer service and reduce costs as even service more calls will be dealt with at the first of contact. Alliance and Leicester are fast becoming the most customer focused financial organisation.
Alliance and Leicester have an e-mail system, which means that they can communicate with their customers all over the world at any time. The Internet makes people all over the world aware of Alliance and Leicester and as more people are aware of their existence and their products and services and the quality of them they are more likely to become customers banking over the Internet also buying insurance, mortgages and taking out loans which increases turnover or profits.
A large organisation like Alliance and Leicester needs up to date information whether it is about customer accounts, how the markets are performing or passing information between the Staff. If there weren't ICT then other forms of communication would be used such as letters, telephones and meetings. The problem with these methods is that they take too long, with ICT everything is done very quickly and decisions can also be made much quicker. If a customer comes into an Alliance and Leicester branch and there wasn't ICT available it would take Staff much longer to locate the customers personal details and other details the customer require manually but with ICT all the customer details are at your fingertips through the computer systems which is very quick and efficient.
ICT has a major impact on Alliance and Leicester. As everything from record of financial accounts to keeping to keeping the details of the customers in order are done by computer. This cuts down the workload of the Staff so fewer Staff are needed. As Alliance and Leicester are employing less Staff they are spending less on wages, which cuts down costs. Customer service is also improved by ICT as customer complaints are dealt with much quicker because the Staff can make decisions themselves or pass the customer details and complaint onto another member of Staff or manager who is better trained to deal with that with that particular complaint is passed onto the other member of Staff or manager much quicker through the use of ICT. This saves the Staff and customers time which means the customers are happy because they are getting a friendly professional and fast service each and every time they are at an Alliance and Leicester branch and the Staff are also saving time because they can deal with each customer more easily and efficiently as all the customers personal details and what savings plans and polices they already have an are likely to buy all come up on the screen at once without the need to type and retype customer details.
The future of ICT in banking is electronic money also known as e-money refers to monetary value measured in currency units stored in electronic form on an electronic device in the customer's possession. The electronic value can be purchased by the customer and held on the device and is reduced when the customer makes a purchase. This is different from traditional electronic payment transactions such as those debit and credit cards, which require on-line authorization, and involves the debiting of the customers bank account after the transaction. There are two different types of electronic devices namely prepaid cards and prepaid software products. With prepaid cards the electronic value is stored on a computer chip embedded in the card and inserting the card in a card reader transfers the value. With software products the electronic value is stored on the hard disk of a computer and is transferred over communication networks like the Internet when payments are made.
Adding Value, Quality Control And Quality Assurance.
Alliance and Leicester add value, which means that they balance the difference between the prices of their products and services and their quality by offering the best possible customer care. They do this by:
Ø Training their staff in Customer care.
Ø Always improving their Internet based services.
Ø Always making their service more accessible.
Ø Always discovering new ways to spot and improve standards of customer care.
If Alliance and Leicester didn't add value to their products and services they would start to make a loss because, these are things that make an impact on Customers. If Value can be improved then Alliance and Leicester can increase the prices of the product. So in return their profits increase.
There are higher costs of poor quality control then there are of good quality control.
The costs of poor quality control are:
Ø Having to re-do things
Ø More time consuming
Ø Loss of customer loyalty
Ø Loss of repeat business
Ø Legal claims
Ø Lower staff morale
Ø Overtime
The costs of good quality control are:
Ø Maintenance
Ø Training
Ø Inspection
Alliance and Leicester know that if they are associated with Quality, trust and experience by their Customers then they will keep returning which means they have gained a competitive advantage over their rivals. Their customers become loyal because they know that they will never receive better service anywhere else. It is better for Alliance and Leicester when they can cut costs but maintain the same Quality of their products and services because then they are making a larger profit.
Alliance and Leicester already have ISO9001, which represents a quality assurance system that assures customers that quality standards are being met.
The requirements of ISO9001 are:
Ø A quality policy must be designed and published.
Ø All the roles and responsibilities that affect quality must be made clear.
Ø A quality management system must be put in place.
Ø They must check they can fulfil the requirements of a contract before they accept it.
Ø The design process, planning process, inputs, outputs and design changes must be fully documented.
Ø Process must be set up for issuing and amending documents.
Ø Supplies should be purchased from approved suppliers.
Ø If customers supply goods to be worked on, there must be a process to check, identify, store and use them as specified in the contract.
Ø There must be process to identify components throughout the manufacturing process.
Ø Before production begins full instructions must be prepared.
Ø Inspections and tests should be carried out when goods and materials are received.
Ø Any equipment used in the inspection must be regularly checked.
Ø Products and components must be labelled so that all staff know whether they have passed, failed or are waiting to be inspected.
Ø Products or services that have failed inspection must be clearly labelled to ensure that they are not used.
Ø There must be systems to avoid the recurrence of problems.
Ø There must be systems to ensure that products are correctly packed, handled and stored.
Ø There should be systems to describe what and how quality records are kept.
Ø There must be systems for managers to check that the quality management system is meeting requirements.
Ø There should be a system to identify what training is needed for each activity affecting quality.
Ø If a customer requires after sales support then systems must be in place to ensure that the work meets quality standards.
Ø If statistical techniques are used to check products or processes they should be fully documented.
Alliance and Leicester have to follow every detail of ISO9001 apart from the ones that don't apply to them.
The advantages of ISO9001 are:
Ø Shows the customers that the company is working at internationally accepted standards.
Ø Most large businesses only deal with companies that have the certificate.
Ø Improves the competitiveness of the company.
Ø Helps the business to spot and stop problems.
The disadvantages of ISO9001 are:
Ø Is expensive to set up and maintain.
Ø There are large amounts of paperwork to complete.
Ø It doesn't guarantee excellent service.
Ø It doesn't help the company to cut costs.
Alliance and Leicester also use Benchmarking to ensure excellent quality service. Benchmarking involves identifying the areas that are under performing and finding out what is the problem and what makes the difference between a good financial organisation and an excellent one to the customer. It could be that the business is not providing the right products and services or that the customers feel they are not being listened to. The identifying the best financial organisation and making comparisons between two. This can help to find the process in the business that could be changed or improved. Benchmarking the organisation that has the best greatest turnover or market share can do this. The organisation could ask the customers which organisation they think is the best and why they think this and then benchmark that particular aspect of the business. The organisation must then set the standards for what needs to be achieved. The senior managers have to make sure that each and every member of staff knows what the standards are and what is required of them to achieve those standards and then the standards must be funded and introduced into the organisation. The standards must be monitored, met and possibly exceeded.
The advantages of Benchmarking are:
Ø Costs can be lowered.
Ø Leads to improved quality.
Ø Genuine comparisons of performance can be made.
Ø Staff can see what they are doing wrong.
The disadvantages of Benchmarking are:
Ø Companies looking at the performance of better performing companies could find it demoralising.
Ø The company needs to have the right culture and structure to allow change.
Ø Can be very expensive to set up.
Ø Companies might be unwilling to reveal the secrets of their success.
Benchmarking doesn't work effectively if the product or service being benchmarking cannot be measured or it is not possible to find a best-practise company. If there is a lack of funding and the changes or improvements needed are too costly to implement.
ISO9001 and Benchmarking helps Alliance and Leicester add value to their products and services by discovering what needs improving and then finding out have this can be done. Alliance and Leicester know that keeping their customers happy is the most important thing. Alliance and Leicester do this by applying ISO9001 and Benchmarking to each and every aspect of their business. If Alliance and Leicester can make the changes and improvements that are needed then they will satisfy the needs of the customers and therefore be adding value to their products and services. Even if Alliance and Leicester's products and services are a little more expensive then their rivals but Alliance and Leicester customer service or customer care is better then their rivals then most people are likely to become customers of Alliance and Leicester and not their rivals because they are treated better and are receiving a quicker, more friendly and efficient service.
I think Alliance and Leicester should use Total Quality Management (TQM) because then every department in the company will be contributing to fulfilling the needs of the customer. American business expert W Edward Deming first introduced TQM in early 1980's. TQM isn't a management tool but a philosophy. The responsibility of satisfying the needs of the customers lies with each and every member of staff from the senior managers working in head office through to the clerks working in the branches.
TQM has many features such as:
Ø Quality chains - there are quality chains between internal and external customers and will remain intact as long as Alliance and Leicester keep on satisfying the needs of the customer.
Ø Company policy and accountability - TQM must be adopted throughout the whole organisation. Staff must be totally committed to giving the best possible care to their customers and take pride in the job they are employed to do. TQM shows the importance of every single staff member and makes him or her accountable for their own performance.
Ø Control - the company must be in total control of everything that has an impact on quality such as:
· Good customer care.
· Good communication between the company and its customers.s
· Providing best right products and services.
Ø Teamwork - TQM shows the importance of teamwork. It is the most effective way of solving problems and has advantages like a larger range of skills, knowledge and experience can be used. Staff morale improves and ideas coming from a team are likely to be more useable then ideas coming from individual staff members.
The advantages of TQM are:
Ø All staff are responsible for their own performance.
Ø Quality is the focus of all the activities that are carried out.
Ø Everything that the company does is to satisfy the customers.
Ø All the products and services are being improved all the time.
Ø Fewer mistakes are made.
Ø Profits increase.
Ø Staff morale increases.
The disadvantages of TQM are:
Ø Can be difficult to put in place.
Ø Can be very expensive to set up.
Ø Staff may not like change.
Ø Can take a long time to put in place.
The human resources department will have to train all the staff in customer care and help or train them to adopt an approachable and helpful attitude.
The finance department will have to make sure that they use the profits in the best possible way to benefit the company and the customers. They will also have to find the money to pay for the training of the staff and provide any other money that is needed.
The administration department will have to make sure that all the documents are correct and have no errors that could course the customer or the business a problem.
The computer technology department will have to make sure that every service they offer over the internet is always is in the best possible working condition. They will also have to make sure that any new service they develop is easy for the customers to access and that it is not too hard for the technology department staff to maintain.
The marketing department will have to make sure that the way they are promoting their products and services is not misleading the customers in any way. They will also have to make sure that the products and services they develop are what the customers want and need.
The customer services department will have to make sure that the customer care they are giving their customers is the best possible care they can give. They will also have to make sure that their staff are properly trained in customer satisfaction.
TQM will help Alliance and Leicester to achieve its objective of becoming the most customer focused financial organisation by improving the standard of customer care. TQM helps to get things right the first time that will save the company money which means they will make cost savings and for fill the objective of making larger cost savings by the end of 2003 based on the cost savings of 2000. Getting everything right the first time for fills the objective of building a more efficient organisation and efficiency saves money and for fills the objective of making a larger profit then 2000. A larger profit means that the objective of increasing shareholder value is also for filled.
