A satisfaction mirror is based on the relationship between customer and employee satisfaction. For example, when customers are generally satisfied, employees are at least equally satisfied. When this phenomenon occurs, corporate earnings increase. However, our situation is slightly skewed from this traditional Service Profit Chain relationship. Our earnings grew 20% between 1994 and 1996 while employee satisfaction decreased 7% over the same period. Since we have such a disconnect, our satisfaction mirror is cracked, as shown in Appendix A.

If the crack is not repaired soon, earnings will begin to suffer. However, the crack can be mended by instituting the following: RBI will continue to utilize SPC techniques to drive our ongoing quest to increase customer and employee satisfaction. RBI will also continue to use a balanced scorecard to predict future performance. RBI will change the description of our two driving concepts for everyday business. We will change our employee's perception of RBI. RBI will increase SSE Plan incentives and increase employee recognition.

RBI will decrease the content of employee surveys while increasing the monitoring rate. RBI will convert middle tier branches to top tier branches. RBI will neutralize low tier branch terrorists. RBI will be an innovator in e-commerce banking.

Basis for The Plan: First and foremost, a slight change in our two driving concepts. In 1997, we stated that customer satisfaction was our "singular priority and everyone's responsibility." Unfortunately, "everyone's responsibility" was perceived as a threat to our employees. RBI's singular priority will now combine customer and employee satisfaction with both areas being the main concern of our firm. I believe that since our employees' perception of RBI is deflated, employees are likely to be dissatisfied.

If the perception increases, then as a result, employee satisfaction will increase. One of our major weaknesses is that the majority of our employees "felt incapable of providing exceptional customer service and had a weak understanding of RBI's product and service line." This is a serious problem since this perception is not only at our frontline, but also for our entire employee base, including management. This problem affects new product revenue because if our management or frontline don't know our product line, then neither will our customers. To address this problem, RBI will implement the RBI University.

The University will provide a wide range of training classes, of which, employees will be required to register for 40 hours of classes per year. Key core classes will train employees on RBI's existing product line, new product development and effective customer service techniques. The university will be a knowledge base, which will be accessible to all employees via our intranet. In addition to the RBI University, employee incapability will be addressed by allotting our frontline with more versatility and power. Another disappointing fact is that the majority of our employees felt "lukewarm" about recommending our products and services. The cause of this problem is piggybacked to the above perception problem.

Obviously, an employee will feel awkward recommending products without a wealth of product knowledge. The result of such awkward action at the frontline will cause the customer to sense incompetence and insecurity in the employee, and our products and services as well. Thus, an inappropriate situation does not foster product growth. The implementation of the RBI University will enable our employees to carry the wealth of knowledge needed for confident product recommendations. Though, in addition to this, our computer databases will be updated with demographic information that will project onto the computer screen during customer transactions. Once the transaction is near completion, the employee will have had the time to make an educated guess on what additional services the customer may prefer.

Therefore, the Tag-On process will be more inviting to the customer and will increase new product sales. Having successfully completed the new product referral, frontline employee satisfaction will substantially increase. Demographic information will be obtained through application forms for new customers and through surveys or old application forms for existing customers. Addressing the weak areas of our employee perceptions will increase overall employee satisfaction and not jeopardize long term profits. Besides employee perceptions, employee survey results must also be addressed. From 1994 to 1995, our recognition, reward, and advancement structures took the biggest hits.

We will continue to offer employee incentives through the SSE Plan, but the payout will increase by 25% and a point for each referral will be given as well. In addition, the frontline employees will receive the incentive reward only after selling one product during either the morning or afternoon. The employee will be eligible for a total of two incentive rewards per day. Employee recognition will become one of the top five job responsibilities for our management. Management will monitor SSE Plan payout and point allocations to determine monthly and quarterly leaders. The top three leaders per term will be eligible for additional cash or prize rewards.

Increasing our employee initiatives will increase their motivation to satisfy customer demands. It will ultimately drive employee satisfaction, reduce employee defection and increase earnings. We will continue to monitor customer and employee satisfaction through corporate surveys. The customer survey will not change, however, the content of the employee survey and administration frequency will change. In order to ensure high completion rates, all surveys will be limited to 3 pages, much like our customer surveys. Surveys will be issued in January and July, with results posted within three weeks of survey completion deadline.

One of the major hurdles we face is increasing customer satisfaction. Conversion of middle tier branches to top tier branches will increase revenue by 20%. On the contrary, there is very little incentive to raise loyalty of low scoring branches. Therefore, potential based marketing strategies will include employing defensive marketing techniques only at our middle tier branches. The goal of this process will be to convert customers that are within the zone of indifference to the zone of affection, creating a larger group of apostles. Since our industry has had rising switching costs, we have less risk of customer defections.

On the other hand, high switching costs cause for greater risk for terrorists and hostages and negative word of mouth. Therefore, we will also engage some effort to neutralizing terrorists at our low tier branches. If we can neutralize terrorists at low tier branches and increase overall customer retention, we will decrease the chance of declining product loyalty and minimize negative word of mouth. Our customers constantly demand more selection of banking products and up to date delivery channels. An upcoming delivery channel is e-commerce banking. Currently, only 1% of our customers prefer this method, but this will grow exponentially in the next decade.

Therefore, RBI must be an innovator in e-commerce banking. If not, customers will defect in record numbers. New product development for e-commerce banking must start now. Appendix A: RBI Satisfaction Mirror 337.