Six Sigma: A Tool to Increase Customer Satisfaction at Bank of America
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Case Details:
Case Code : OPER052
Case Length : 14 Pages
Period : -
Organization : -
Pub Date : 2005
Teaching Note : Not Available
Countries : -
Industry : -
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Excerpts
Six Sigma Journey at Bank of America
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Ever since its formation, BoA had given greater importance to increasing its
size and securing larger numbers of customers than providing customer
satisfaction and retaining customers. In due course, the company realized that
the quality of service it was providing was getting poorer due to its
inefficient processes. Therefore, the company decided to make process
improvements throughout the company. However, the plans did not materialize due
to a lack of systematic implementation.
When Lewis took over as the Chairman and CEO in 2001, he adopted an organic
growth strategy, which emphasized building strong customer relationships. The
strategy succeeded in creating a strong customer base for the bank in the US...
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The Gains
After the application of Six Sigma and other tools in 2001, it was estimated
that BoA gained more than $2 billion through significant cost savings and
revenue generation from 2001 to 2003. The initial GB project in 2001-02
reduced 70% of errors and missing items in customer statements. It reduced
errors in encoding and the number of delays in posting customer
transactions. Most of the initial Six Sigma projects in BoA concentrated on
the ATM system failures and defects in telephone banking and online banking,
which were reduced by 88% by 2002. By 2002, with a strong focus on customer
issues and performance gaps, the GB project became a huge success which
proved the applicability of Six Sigma to financial services.
BOA achieved an increase in delighted customers from 41% of 2001 to 50% in
2003 with an increase of more than 2.5 million customers. In 2003, the
account losses were reduced by 28%. Also, the number of accounts was
increased by more than a million in 2003...
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Exhibits
Exhibit I: Facts About Bank of America (2004)
Exhibit II: Business Segments in 2004
Exhibit III: Background of Bank of America
Exhibit IV: A Conceptual Note on Six Sigma
Exhibit V: 10 Six Sigma GB Projects Undertaken by Bank of America
Exhibit VI: Core Values of BOA
Exhibit VII: Financial Summary |
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