“I know what we can do next; everything has been so successful so far,” said Kay Ebelhar, marketing services division manager. “How about designing and offering a courtesy service guarantee? We will promise to greet customers, give them our undivided attention, and then thank them when they leave. As with our other service guarantees, if we fail to deliver superior service encounters, we’ll give the customer $5.00! What do you think?” So, the discussion began this Tuesday morning at the monthly meeting of the Marketing Control Task Force (MCTF). Following these words, Sarah Coleman, service guarantee manager for Gulf Coast Bank (GCB), pondered what the next step should be in her company’s journey to become the industry leader in customer service.
Four years ago, the bank undertook an extensive study to identify the needs of its target customers and analyze the actions of its competitors. Aided by extensive market research, management quickly realized that certain service features such as convenient location, interest rates paid on customer accounts, and extended branch bank hours had become a baseline level of performance (order qualifiers) from which nearly all competitors operated. GCB leaders determined that to gain a competitive advantage, they must provide customers with superior service, in addition to the baseline features. To achieve this, the MCTF was created.
The bank’s service guarantee program has been in place for 10 months now. Since January, media campaigns have announced the service guarantees to the public and bank employees have received training about them. In this short amount of time, it has been difficult to evaluate the results of the service guarantee program. Sarah knows that the bank spent $860 for payouts during the 10 months for 300 branch banks and that there seemed to be no trend up or down in the monthly payout amounts. Sarah was the only one asking tough questions during MCTF meetings such as “Are service upsets and errors being reduced?,”
“Are employees motivated to provide exceptional service?,”
“Are the bank’s processes and operational capability getting better so GCB can execute these service guarantee performance levels?,” “Is a $5 payout per service upset adequate?,” and “Is the bank’s current service guarantee program a failure?”

A Gold Service Guarantee Program was developed with the intent of insuring that the bank would emerge as a leader in service quality within its market. It would also be a source of competitive advantage, and a fundamental component of their new corporate culture.
The initial phase of the Gold Service program consisted of a series of print, radio, and television advertising, as well as promotional campaigns geared toward customers and employees. During this “awareness phase,” the goal was to create a general market awareness of Bourbon Bank’s attention to superior service. Next came the “action phase,” where the bank set out to show specifically what it meant to have excellent customer service. By implementing external programs for customers, as well as internal programs for employees, it could demonstrate the bank’s commitment to following through with the ideals established in the previous phase. Media campaigns played a significant role in this phase too, and promotional videos were used internally to create service guarantee awareness and action.
Externally, the Gold Service Telephone Line was established to answer and resolve any customer question or problem (although the average speed of answer time at the bank’s customer call center was increasing, not decreasing these past 10 months). Single-transaction express teller windows at all branch banks added friendly signs aimed at satisfying customers requiring simple transactions and quick response.
Internally, an extensive two-day training program for all 6,200 employees was developed to teach them how to live up to the attributes of the “customer service pledge.” After training and signing the pledge, each employee received a paperweight inscribed with the pledge as a way of making “Gold Service” more meaningful and relevant to both customers and employees.
The bank initially introduced three specific guarantees.
First, checking and savings account statements are guaranteed to be accurate. If there is a mistake, regardless of the reason, the customer receives $5.00. Second, customers are promised answers about their application for a home or automobile loan in the time frame specified by the customer. This guarantee is the personal commitment of the employee who takes the application to deliver an answer within the customer’s specified time frame. If the employee does not, GCB will pay the customer $5.00. Finally, the bank promises that customers who call the Gold Service Telephone Line will not be transferred, asked to tell their story twice, or made to search for answers themselves.
If they are, the employee will award the $5.00 payout on the spot. All payouts are credited to the customer’s bank accounts.
A $5.00 payout is associated with each guarantee and is given to the customer at the time the guarantee is invoked.
In addition, a service upset form is completed describing the incident. Either the employee or the customer can complete the form, but both must sign it to invoke the guarantee. The service upset form is then sent to a central location for tracking.
Monthly, managers receive summary reports about the guarantee infractions in their area but the reports do not identify specific individuals who might be at fault. MCTF receives a summary of this report by the branch bank.
Sarah Coleman was the only member of the MCTF who had doubts about the success of the service guarantee program, but she was not about to push too hard—her job depended on the success of the program. Everyone else on the task force had jumped on the marketing bandwagon and hyped up the program as a solid success, even the president and CEO, Mr.
Del Car. Privately, Sarah had many questions about this service guarantee initiative but all the banks were doing them.

Case Questions for Discussion:
1. What are the objectives of the service guarantee program?
2. Is a total payout of $860 over 10 months for 300 branches good or bad?
3. Are the bank’s services and processes truly redesigned to meet the service guarantee promises?
4. Is GCB’s service guarantee program well-designed and executed?
5. What are your final recommendations?