Taking Service to the Next Level

Meridian Credit Union : Taking Service to the Next Level

(Central 1 Market Smarts newsletter, November 2009)

Merdian Credit Union was created from the 2005 merger of HEPCOE Credit Union and Niagara Credit Union. The newly-formed organization manages approximately $4.6 billion in assets and serves 214,000 retail and business members throughout southern Ontario. With 44 branches and eight commercial business centres, Meridian Credit Union is the largest credit union in Ontario and the fourth largest in Canada. Meridian is dedicated to reinventing neighbourhood banking by extending operating hours, increasing member access to financial coaches, and ensuring decisions are made at the local level.

After the merger, Meridian undertook the usual post merger activities of integrating business systems and banking platforms. Creating or nurturing a sales culture didn’t start until 2006 and is still an ongoing process according to Robert Leaker, Vice President, Emerging Markets and Business Innovations, “We may have started with the best from both worlds but we also wanted to build an organization based on the Meridian way and not on a sales and service program developed in the past, and that takes time and commitment from all levels of the organization”. In fact, Robert emphasized the time an organization needs to commit to the process, “You can’t give up after twelve months or switch providers because results have not been immediate. Our cultural shift took eighteen months and three years later we are still in the process of implementing stage three, our proactive sales model.”

However, discussing stage three is premature unless a review of the development and implementation of the first two stages is complete. Without developing the ground work stage three will not succeed. Robert states, “Unless your members are receiving a level of service that is able to move them from a zone of indifference to a zone of delight your chances of success are greatly diminished”. A credit union must earn the right to ask for the business (see Relationship Hierarchy). One might think that a program that takes three years to implement is unusually long, however, Meridian is committed to developing a culture supported not only by its employees but accepted by its membership.

Defining Service and Establishing Benchmarks

Meridian’s initial discussions and ultimate commitment to develop a pro-active sales culture started with the establishment of a clear definition of service. Questions management had to answer included: what is good customer service, what does it look like and how do you measure if you are successful?
Many credit unions utilize annual surveys to measure a variety of service attributes. Annual surveys are an excellent tool to establish benchmarks and examine specific issues. They are and continue to be a valuable asset in a credit union’s arsenal to measure success and discover if problems exist. When embarking on the new sales program Meridian employed a member wide survey to establish initial customer service benchmarks. They also discovered what service attributes were important to their members.

After the initial research was complete, Meridian developed a system of measurement specifically related to member service metrics and began to track the results on a weekly basis. Without weekly reports the credit union could not determine if a new service program or tactic was effective and quickly address any issues. Weekly reporting would also maintain employee engagement (both frontline and management) in the pursuit of service excellence.

Ultimately the key member service metric Meridian Credit Union chose as a measure of corporate success was the Net Promoter Score or NPS. The NPS methodology in its simplest form is the result of asking one straightforward question: “Are you willing to recommend Meridian Credit Union to your friends and family?”
When the credit union took its first NPS measurement, they discovered the score was +55 out of a possible 100 points (the lowest possible NPS is –100). The score is derived by tallying those who scored 0 to 6 (on a scale of 0 to 10) and subtracting from those who scored a 9 or 10. Best in class NPS for the financial services industry range in the neighborhood of +75 to +80. Meridian is proud to say that some of their branches have already achieved these high ratings.

The NPS may be the metric the credit union uses to rate its service success, but other indicators are also utilized to help tell the story. The credit union tracks overall recent branch satisfaction. This index, made up from a variety of questions, represents satisfaction levels for the last visit or interaction the member had with Meridian and helps management understand if tactics implemented in branch locations are working over time. Overall satisfaction is also measured and represents how satisfied the member is with Meridian as an organization. Likelihood to repurchase from Meridian indicates how likely the member is to make their next financial purchase at the credit union. The credit union weighs and combines the scores for overall satisfaction, likelihood to repurchase and willingness to recommend to achieve an index and rolling score that should indicate how the credit union will do in a year end survey based on the Millward Brown Index.

Millward Brown Index

The Millward Brown Index is made up by weighting the average scores for recent branch satisfaction, overall credit union satisfaction and likelihood to repurchase. The weekly scores give an indication if the branch is trending towards an improved year end score. If the weekly trend is lower the branch has an opportunity to immediately address any issues. If trending wasn’t utilized, the branch would not know service levels were in decline and risk the possibility of alienating members over a twelve month period. A more comprehensive year-end survey is conducted to determine if the score has improved over the past year.

Through the survey process, Meridian identified primary and secondary drivers of service. Primary drivers are the areas that members have identified as most important in providing exceptional service. These drivers can change over time as members expectations change. By excelling at primary drivers the credit union can impact the overall level of service a member receives and help move them from the zone of indifference to the zone of delight. Secondary drivers are important as well and members expect the credit union to be strong in these areas. Meridian explains that being great in these areas alone, however, will not necessarily move a member into the zone of delight. Members happy with service levels for these secondary drivers may remain satisfied but not wowed to the point of willingness to make a referral.

Example of primary drivers are:

• Value added service
• Problem resolution satisfaction
• Knowledgeable staff
• Range of products and services
• Perceived wait time

Examples of secondary drivers are elements of:

• Branch experience
Ex: courteous and polite and convenient hours
• Advisor experience
Ex: Availability of advisor and financial planning experience
• Problem experience
Ex: Problem communication and resolution

Meridian’s weekly survey process enables the credit union to analyze the drivers behind an improvement or slip in their NPS. Meridian surveys two to three members of each branch on a weekly basis and inquires about service interactions that have taken place in the past 72 hours. Once information is gathered, the results are analyzed to help understand how the lack or presence of a particular driver influences the overall results.

After Meridian gathers all the data, the results are reported to branch management who have access to the information through the credit union’s intranet and the Service & Sales Management Dashboard. This reporting leads to stage two of the program.

Reporting, Communicating Results and Coaching

Although Meridian has developed a system that can measure their level of member service success, this effort would be lost if the credit union was not taking steps to act upon the results and implement programs to address service issues. As part of the overall initiative, the credit union implemented phase two of the program. This phase includes management practices that are used to help develop a sales-based culture. These management practices include reporting service results, hosting meetings to understand branch and corporate goals, providing coaching sessions, and developing the Member Concern Program.

Each week the results of branch surveys are displayed on the dashboard which enables branch staff to view the results of the surveys conducted for their location. Branch employees are aware that scores may fluctuate due to small sample sizes, but over time trends will emerge. The year-to-date number is the strongest indicator of how branch teams are progressing. Scores and trending are available for all metrics on a weekly basis and branch management can easily see what attributes of service are improving or trending lower.

Management suggests that branch staff examine both the Net Promoter trending and Member Concern reports together in order to be able to quickly address any situations that may be impacting the member experience. The Member Concern reporting includes verbatim comments that can emphasize or highlight certain situations or cast light on why specific metrics may be trending lower and causing a decline in the branch’s NPS. By analyzing the primary and secondary drivers of service and implementing changes to address areas of weakness, management can see if their initiatives are working by continuously reviewing their weekly reporting. By focusing on weaknesses at weekly huddles, branches help staff hone in on areas that require improvement. Huddle guides are available on the credit union’s intranet to help branch management maintain the awareness and focus necessary to facilitate weekly improvement. Managers are directed to address primary drivers first and then work on secondary drivers of service. Huddles only last 10 to 15 minutes and are designed so any member of staff can facilitate.

Meridian also employs coaching to help drive change. Changing behaviour is not easy as old habits die hard. For sustainable change to take place, good coaching is necessary to continuously reinforce desired behaviours.