Total Quality Management in Banking Sector - HDFC , TQM ,

1. Quality
Management in
Private Banking
Sector
GROUP 9
Suyash Jain C016
Apoorva Jajoo C017
Shreya Khare C018
Akshay Khatri C019
Tejasv Kumar C020
Aakarsha Lamba C021

2. Introduction
Total - made up of the whole
Quality - degree of excellence a product or service
provides
Management - act, art or manner of planning,
controlling, directing,….
Therefore, TQM is the art of managing the
whole to achieve excellence.
Service quality is defined as the degree of
discrepancy between customers’ normative
expectations for service and their perceptions of

3. • Global world suffered from financial depression in recent years, it is
essential for banks to establish a sturdy and solid loyal customer base
to weather tougher economies and more intense competition.
• Indian banking sector continuously expanding still it has faces tough
competition between public sector and private sector banks
• The public sector banks dominate the banking industry in terms of size
of assets .
• The government has now recognized the need to make banking industry
more competitive and made various policies to support them.
• Banks have expanded their operations and more foreign sector banks
have entered the Indian banking industry

4. Dimesions of Service Quality
RESPONSIVENES
RELIABILITY
ASSURANCEEMPATHY
TANGIBILITY

5. Service Quality
Determinants

6. Ease of Access Tangibles
Security Credibility
Communication

7. Courtesy
Understanding
Competence Reliability
Responsiveness

8. Kano Model
Time

9. Kano Model
• Availability of multifunction
kiosks.
• Ease of Access
• Reliability
• Banks should remain open
on Sunday
• Expert service available for
import/export business
• Supportive behavior of
member of staff
• Space available for
sitting/writing /waiting
• Reliability
• Courtesy
• Locker service rendered
by branch
• Availability of ATM
facilities
• Short Duration of time in
payment of cash /DD/FD
• Issue of cheque book in
current a/c
• Layout & signboards
• Sanctioning of loans
• Responsiveness
• Nominal Interest Rates
• Security
• Locker Facility

10. Case Study

11. History
• First to receive an 'in principle' approval from the Reserve Bank of India
(RBI) to set up a bank in the private sector
• HDFC was incorporated in 1977 with the primary objective of meeting a
social need that of promoting home ownership by providing long-term
finance to households for their housing needs
• VISION STATEMENT-
To build a world class Indian bank.
• MISSION STATEMENT:
Use enabling technologies to provide value added products and services to
customers at value for money price.
• It has also received a CII-EXIM Bank Commendation Cert. for commitment
to TQM- 2000.
• Various researches conducted for quality enhancement.

12. Quality Policy
• SECURITY: The bank provides long term financial security to
their policy. The bank does this by offering life insurance and
pension products.
• TRUST: The bank appreciates the trust placed by their policy
holders in the bank. Hence, it will aim to manage their
investments very carefully and live up to this trust.
• INNOVATION: Recognizing the different needs of our
customers, the bank offers a range of innovative products to
meet these needs.
• INTEGRITY
• CUSTOMER CENTRIC
• PEOPLE CARE “ONE FOR ALL AND ALL FOR ONE”
• TEAM WORK
• JOY AND SIMPLICITY

13. Quality objective
Decrease number of customer complaints
Improve customer service scores in every branch time to time
Reduce customer wait time in line and ensuring adequate staffing during peak
periods.
Reduce data-entry time per customer by consolidating multiple databases into
one data management system by the end of this year.
Increasing the security in internet banking portals.
Reducing the transaction failure rate for online payments.
Improving the instant fund transfer app Chillr-HDFC Bank

14. Quality process

15. TQM implementation
Reducing the processing times of key products and services
Promptness in responding to customer inquiries
Accuracy and timeliness of statements of accounts and records
Customer Service Quality
Banking Service Product Quality
E-banking Improvement
Increasing Customer Satisfaction & Security

16. Quality Tools
They are called basic because they are suitable for
people with little formal training in statistics and
because they can be used to solve the vast majority
of quality-related issues.

17. Cause-and-Effect
Diagram

18. Account
Opening
Delays
Environment People Process
Measurements Machine
No back-up support system
Management issues
Absenteeism
No training program
Workload
Material
Maintenance issues
Network issues
Low employee engagement
Rules and Regulations
Infrastructure
Law and Order
Location
No proper tracking system
No proper return mail
monitoring
Service Desk
Less printers
Outdated systems
No token System
Unavailability of stationary
Improper sealing of envelopes
Low quality paper
Delay caused in Opening a new account

19. Scatter Diagram
0
2
4
6
8
10
12
0 10 20 30 40
Service Time (in minutes)
Customer
Feedback
(scale from 1- 10)
Independent Variable : Service Time
Dependent Variable : Customer Feedback

20. PARETO CHARTS
39%
63%
76%
87%
96%
100%
0%
20%
40%
60%
80%
100%
120%
0
2
4
6
8
10
12
14
16
18
20
General behavior
of member of staff
Performance of
internet banking
&mobile banking
Availability of staff
member for
enquiry & listening
of problem
Time taken in
proceed of
outstation
cheques
Duration of time in
payment of cash
/DD/FD
Time taken in
sanctioning of
loan

21. FMEA for HDFC
Bank
Failure Mode Effect Analysis

22. Why companies go for
FMEA??
• Get it right the first time
• Identifies any inadequacies in the
development of the product
• Tests and trials may be limited to a
few products
• Continuous improvement
• Preventive approach

24. Effect SEVERITY of Effect Ranking
Hazardous without
warning
Very high severity ranking when a potential failure mode affects
safe system operation without warning
10
Hazardous with
warning
Very high severity ranking when a potential failure mode affects
safe system operation with warning
9
Very High System inoperable with destructive failure without compromising
safety
8
High System inoperable with equipment damage 7
Moderate System inoperable with minor damage 6
Low System inoperable without damage 5
Very Low System operable with significant degradation of performance 4
Minor System operable with some degradation of performance 3
Very Minor System operable with minimal interference 2
None No effect 1

26. Process
Step
potential
failure
mode
potential
failure
effect
Severi
ty
Potential
causes
likelin
ess of
failure
current
process
control
detectab
ility of
failure
RPN
action
recommen
ded
Resposibility action taken
new
severity
new
likelines
s of
failure
new
detectabi
lity
new
RPN
Withdraw
al of cash
Cash not
disbursed
dissatisfie
d
customer 7
Machine
out of
cash 7
internal
alert of low
cash in
machine 4 196
improve
monitorin
g of cash
threshold
levels
across
machines manager
minimum
cash
threshold
limit of
heavily used
machine is
increased to
prevent out-
of -cash
situation 7 4 3 84
Account
debited
but cash
not
disbursed
very
dissatisfie
d
customer 8
transactio
n failure
or
network/s
erver
issue 3
load
balancer
installed to
distribute
workload 4 96
enhance
transactio
n
processing
system manager
proper
verification
of the
trnsaction 8 3 2 48
extra cash
disbursed
bank
loses
money 8
bills stuck
to each
other 2
verification
while
loading
cash in
machine 3 48
change
the quality
of paper manager
verification
while loading
cash in
machine 8 2 2 32

27. QUALITY FUNCTION
DEPLOYMENT

28. CONCLUSION
AND
RECOMMENDATION
S

29. RECOMMENDATIONS
• Provide the bank employees first-hand best
corporate practices
• Expose the bank employees to the environment in
which the bank customers use the bank's services
• Constantly retrain the bank staff in the theory and
practice of TQM
• Showcase the customer quality
• Establish a continuous improvement culture in the
Bank Initiate vigorously continuous process
improvement in the Bank. The process improvement
can be brought about by;
• Breakthrough thinking;
• Process stabilization; and
• Incremental Imrovement

30. Conclusion
• A link between service quality and
satisfaction level can be established, i.e.
customers’ satisfaction is influenced by
the level of total service quality.
• However, it was also found that certain
service quality dimensions fell short of
customer’s expectation as their
perceived service quality was less than
their expectations.

31. • There is a close relationship between the
employee perceived quality in banks and
the actual service quality perceived by
bank clients.
• Customers are important aspect of bank
and loyal consumers can add value to
profitability of banks.
• TQM can improve performance of a bank
by lowering costs, increasing revenues,
delighting customers, and empowering
employees.

32. Thanks!
Any questions?