Một số đề xuất nhằm nâng cao chất lượng cung cấp dịch vụ tài khoản thanh toán cá nhân tại techcombank

In the service quality literature, perceptions of service delivery are measured separately from customer expectations, and the gap between the two, P perceptions – E expectations, provid

VIETNAM NATIONAL UNIVERSITY, HANOI

SCHOOL OF BUSINESS

PHUNG THI PHUONG THAO

SOME SUGGESTIONS TO IMPROVE

CURRENT ACCOUNT SERVICE ENHANCEMENT

AT TECHCOMBANK

Major: Business Administration

Code: 60 34 05

MASTER OF BUSINESS ADMINISTRATION THESIS

Supervisors: Dr Tran Doan Kim

Ha Noi, 2012

ABSTRACT SOME SUGGESTIONS TO IMPROVE CURRENT ACCOUNT SERVICE ENHANCEMENT AT TECHCOMBANK

Phung Thi Phuong ThaoMBA candidate, ReMBA8Viet Nam National University, Ha Noi

School of Business

Supervisors: Dr Tran Doan Kim

December, 2012, 101 pagesCurrent Account (CA) is a very important and indispensable meant for not only industrialists, firms, enterprises etc but also for individual customers, who have demand of banking transactions on a daily basis

Customers use their CA neither for the purpose of earning interest nor for the purpose of savings, but only for convenience and comfort of the business The

CA interest rate, hence, is quite low or event equal to zero

The balance from CA, then, becomes a low-price and significant source for banks CA is bringing 10 times profit higher than savings and time deposits; about 2.5 – 4 times higher than loan in NII index

Also, as showed in some studies, customers tend to chose bank with their inflow and outflow of CA to be primary bank to have other bank’s service relationships Therefore, banks are focusing on developing current account to

be the champion product in market expanding strategy

In Vietnam, as information from Vietnam Card Association, there are about

20 million people, mainly in cities, joining current account services It makes the urban market which contributing up to 70-80% income and profit from current account, almost saturated

It is estimated that “acquiring new customer can cost five times more than the cost of satisfying and retaining current customers” (Philip Kotler, 2001) From this fact, banks are now paying more attention to improve services to satisfy customer who become harder and harder to please

The thesis focuses on discovering deeply insides individual customer using current accounts, what the factors of satisfaction are and giving out some initiatives of customer satisfaction improvement

TABLE OF CONTENTS

ACKNOWLEGEMENT i

ABSTRACT ii

TÓM TẮT iv

TABLE OF CONTENTS vi

LIST OF TABLES ix

LIST OF FIGURES xi

CHAPTER 1 LITERATURE REVIEW 1

1.1 CUSTOMER REALATIONSHIP MANAGEMENT 1

1.1.1 Definition 1

1.1.2 IDIC: Four implementation tasks for creating and managing customer relationships 2

1.2 CUSTOMER SATISFACTION 4

1.2.1 Definition 4

1.2.2 The role of expectations and perceptions 5

1.2.2 Service quality and GAP model 6

CHAPTER 2 TECHCOMBANK CASE STUDY 19

2.1 TECHCOMBANK AND CURRENT ACCOUNT SERVICES 19

2.1.1 Techcombank overview 19

2.1.2 Techcombank current account strategy and ambitious plan to 2014 26

2.1.2 Techcombank current account’s performance 28

2.2 A REVIEW OF TECHCOMBANK’S CUSTOMER RELATIONSHIP MANAGEMENT 30

2.2.1 CRM department 30

2.2.2 CRM in process 31

2.3 A REVIEW OF TECHCOMBANK’S SURVEY ON CURRENT ACCOUNTS SERVICE 31

2.3.1 Survey objective 31

2.3.2 Focus group 33

2.3.3 Quantitative survey on customer satisfaction 36

2.3.4 Quantitative survey on customer satisfaction 43

CHAPTER 3: FINDINGS 45

3.1 CRM ACTIVITIES 45

3.2 CUSTOMER GAP ANALYSIS 46

3.3 PROVIDER GAP ANALYSIS 48

3.3.1 Not knowing what customers expect and not selecting the right service designs and standards 48

3.3.2 Not delivering to service designs and standards and not matching performance to promises 50

CHAPTER 4: RECOMMENTATION 56

4.1 INTERNAL TRANING AND COMMUNICATION 56

4.2 KPIs AND SALES ORIENTATION 57

4.3 ENHANCE SERVICE STANDARDZATION 58

4.4 IMPROVEMENT PROCEDURE TO REDUCE SERVING TIME 59

4.5 DEVELOP ALTERNATIVE CHANNEL TO REDUCE OTC WORKLOAD 60

4.6 PRODUCT DESIGN 60

4.7 PAYROLL FORCUS 61

4.8 CRM ENHANCEMENT 63

QUESTIONNAIRE 65

REFERENCES 97

LIST OF TABLES

Table 2.1: Techcombank current account portfolio to 2014 27

Table 2.2 : Techcombank CA NIM performance 28

Table 2.3 : Techcombank CA multiple-service Customer ratio 29

Table 2.4 : Techcombank CA’s balance portfolio by products 30

Table 2.5 : Prompt responses to customers’ requests 34

Table 2.6 : Customer satisfaction on Enthusiastic bank staff 34

Table 2.7 : Product structure to fulfill customer needs 35

Table 2.8 : Effective added services 35

Table 2.9: Survey Systematic Sampling – Single Product user 37

Table 2.10: Survey Systematic Sampling – Multiple-Product users 37

Table 2.11: Feedback on customer choice (%) 38

Table 2.11: Other banking services using (%) 38

Table 2.12: Which offer will do customers interested in opening ATM card or registering for internet banking with TCB? 38

Table 2.13: Feedback on CA opening and services registered procedure (%) 39

Table 2.14: Feedback on card issuance time (%) 39

Table 2.15: Feedback on Token key issuance time (%) 40

Table 2.16: Customer’ first Chanel chosen 40

Table 2.17: Prompt responses to customers’ requests 40

Table 2.18: Satisfaction level with “Enthusiastic bank staff” 41

Table 2.19 : Product structure to fulfill customer needs 41

Table 2.20 : Effective added services 42

Table 2.20 : What factor influences customer to start using a CA ? 42

Table 2.21 : Which factor decide the main bank ? 43

Table 3.1: Data ware-house status 45

Table 3.2: Data avalable sources 46

Table 3.3 : GAP on customer satisfation 48

Table 3.4 : Complaint management 54

Table 3.5 : Sales force activities 55

LIST OF FIGURES

Finger 1.1: IDIC: Analysis and Action (Peppers and Rogers, 2004) 4

Finger 1.2: GAP Model (Parasuraman, A., Zeithaml, V.A and Berry, L.L, 1991) 7

Finger 1.3: Provider Gap 1 (Parasuraman, A., Zeithaml, V.A and Berry, L.L, 1991) 9

Finger 1.4: Provider Gap 2 (Parasuraman, A., Zeithaml, V.A and Berry, L.L, 1991) 10

Finger 1.5: Provider Gap 3 (Parasuraman, A., Zeithaml, V.A and Berry, L.L, 1991) 12

Finger 1.6: Provider Gap 4 (Parasuraman, A., Zeithaml, V.A and Berry, L.L, 1991) 14

Finger 2.1: Current account key proposition [TCB, 2011-2014 strategy] 27

Finger 4.1: Sales model [R&D department, PFS action 2013 plan] 58

Finger 4.2: Customer interactions procedure [TCB, 2011-2014 strategy] 59

Finger 4.2: Product design [R&D department, PFS action 2013 plan] 61

Finger 4.3: Cross-sell process [R&D department, PFS action 2013 plan] 62

Finger 4.4: CRM Capabilities will be mapped [R&D department, PFS action 2013 plan] 63 Finger 4.4: CRM assessment Approach [R&D department, PFS action 2013 plan] 64

CHAPTER 1: LITERATURE REVIEW

This chapter reviews literature relating to the research questions and hypotheses of this study First, the chapter begins with a summary of customer relationship management (CRM); then, the relationships of four implementation tasks for creating and managing customer relationships Finally the definition of customer satisfaction and the impact of factor on customer satisfaction are provided

1.1 CUSTOMER REALATIONSHIP MANAGEMENT

1.1.1 Definition

Customer Relationship Management (CRM) is “a set of business practices designed, simply, to put an enterprise into closer and closer touch with its customers, in order to learn more about each one, with the overall goal of making each one more valuable to the firm” (Don Pepper & Martha Rogers, 2004)

In a simple world, CRM is a tool helping an enterprise to set up and manage individual customer relationships

The CRM is also known by other terms such as integrated marketing

communication (Don Schultz), one-to-one relationship management (Don

Peppers & Martha Rogers), real time marketing (Regis Mc Kenna), customer

intimacy (Michael Treacy & Fred Wiersema)…

“CRM is more than just an outgrowth of direct marketing and the advent of new technology It requires new skills, systems, processed and employee mindsets (Philip Kotler, 2001).”

The central purpose of CRM are setting up and operating us for the enterprise

to focus on increasing the value of customer base, whether through

cross-(getting customers to buy more expensive offerings)

1.1.2 IDIC: Four implementation tasks for creating and managing customer relationships

Setting up and managing individual customer relationships can be broken up into four interrelated implementation tasks: identifying, differentiating, interacting with and customizing treatment

Identify customer

The first task in setting up a relationship is to identify, individually, the party

of the relationship as much detail as possible An enterprise must have an ability to recognize a customer when he comes back in person, directly, by phone, online or whatever

Differentiate customers

Customer represents different level of value to the enterprise, therefore, they requires differently from the enterprise Grouping customer bases on specific variable allows a company (1) to focus its resources on the most value customer groups, and (2) design and control customer-specific strategies of products, services enhancement

Interact with customer

Enterprise must improve the effectiveness of their interactions with customers Instead of talking to customer with whatever dialog, the company should continue with prior communication if it has occurred before

Customize treatment

Base on individual’s needs and value, the enterprise should adapt some aspect

of its behavior toward a customer This customization could involve the way a newsletter is rendered or how a product is bundled

Treating different customer differently could be very expensive if every interaction and transaction had to be individually adapted Many enterprises are now using a technique of mass customization

“A mass customizer actually does is not customization, but configuration

The mass customizer pre-produces a dozens, or hundreds, of “modules”, for a product, and/or its related services, delivery options, payment plants, and the like Then, base on an individual customer’s needs, the company puts different modules together to yield thousands, or even millions, of possible product configuration (Don Pepper & Martha Roger & Bob Dorf, 1999).” The biggest obstacle is ensuring that different parts actually work with one another and can be fit together easily

The implementation of the IDIC methodology can be broken down into two categories: analysis and action

Finger 1.1: IDIC: Analysis and Action (Peppers and Rogers, 2004) 1.2 CUSTOMER SATISFACTION

1.2.1 Definition

Customer satisfaction, a term frequently used in Marketing and product R&D,

is a measure of how a product or service meet or surpass customer expectation

Satisfaction is a widely accepted concept despite real difficulties in measuring and interpreting The most common approach is the use of general satisfaction surveys undertaken every few years and designed to track changes over time

There are however, a number of difficulties with the concept of satisfaction (Communities Scotland, 2006):

“It is not static, but changes over time; new experiences and levels of awareness will alter the potential levels of satisfaction that could be achieved

It is likely to be complex and the result of a mix of experiences before, during and after the point at which it is measured

It occurs in social contexts which are varied and changing and may be unpredictable or inexpressible to the service user

It may be difficult to express the reasons for satisfaction; particularly where less tangible aspects of services are being considered

It may be easier to express the reasons for dissatisfaction, particularly if this is the exceptional state.”

In order to get a better view on satisfaction, we describe some key elements in this part If experience of the service greatly exceeds the expectations clients had of the service, then satisfaction will be high, and vice versa In the service quality literature, perceptions of service delivery are measured separately from customer expectations, and the gap between the two, P (perceptions) – E (expectations), provides a measure of service quality and determines the level

of satisfaction (Parasuraman, A., Zeithaml, V.A and Berry, L.L, 1991)

1.2.2 The role of expectations and perceptions

Customer expectation is the main element influencing customer satisfaction

It is important to understand how they are formed The basic key factors most commonly seen to influence expectation are:

Many customers will have had experience of using services before This previous experience will influence their future expectation of the service This can include their past experience of a similar services

Word of mouth communications

Expectation of customer may be influenced by other sources other than the service provider itself Family, friends, colleagues, media…also influence in customer expectation shaping

Explicit service communications

Statements from leaflets or other publicity material can have a direct impact

on expectation

Implicit service communication

This includes factors such as: the physical appearance of the building, well lighted parking lot…which customer may sense only vaguely

The overall model of key factors influencing expectation of public services is widely recognized that the nature and impact of each of these influences will vary for different customers and services This is not an additional determinant of expectations in the same way as those outlined above, but it is critical to understand when making comparisons between public services: for some services, the greatest influence on the level of expectations is likely to

be the nature of the customer group that is being served

1.2.2 Service quality and GAP model

As described above, the service quality model starts from the basic gap between P (perception) – E (Expectation)

Service quality gap model has been divided by 2 parts: Customer gap and provider gap

Finger 1.2: GAP Model (Parasuraman, A., Zeithaml, V.A and Berry, L.L,

1991)

Customer Gap

The customer gap is the difference between customer expectation and perceptions (Figure 1.2) Customer expectations are standards or reference points that customers bring into the service experience, whereas customer perceptions are subjective assessments of actual service experiences

Gap closed to zero or perception service similar to expectation is perfect thing, but Companies tend to close customer gap to develop

Provider Gaps

To close the all important customer gap, the gaps model suggests that provider gaps need to be closed These gaps occur within the organization providing the service and include four gaps:

Gap 1: Not knowing what customers expect

Gap 3: Not delivering to service designs and standards

Gap 4: Not matching performance to promises

More details of these gaps are provided below:

Gap 1: Not knowing what customers expect

Gap 1 defines the difference between customer expectations of service and company understanding of those expectations

There are many reasons for managers not being aware of what customers expect: they may not interact directly with customers, they may be unwilling

to ask about expectations or they may be unprepared to address them, also they may image all customers are similar to themselves These will lead to bad decisions and unreasonable resource allocation that result in perception of poor service quality

When management or empowered employees do not acquire accurate information about customers’ expectations, provider gap 1 is large Formal and informal methods to capture information about customer expectations must be developed through marketing research

Finger 1.3: Provider Gap 1 (Parasuraman, A., Zeithaml, V.A and Berry,

L.L, 1991) Gap 2: Not having the right service quality designs and standards

Gap 2 focuses on difference between company understanding of customer

Customer expectation

 Inadequate marketing research orientation

 Insufficient marketing research

 Research not focused on service quality

 Inadequate use of market research

 Lack of upward communication

 Lack of interaction between management and customers

 Insufficient communication between contact employees and managers

 Too many layers between contact personnel and top management

 Insufficient relationship focus

 Lack of market segmentation

 Focus on transactions rather than relationships

 Focus on new customers rather than relationship customers

 Inadequate service recovery

 Lack of encouragement to listen to customer complaints

 Failure to make amends when things go wrong

 No appropriate recovery mechanisms in place for service failures

Company perception of customer expectation

G

A

P

1

 Poor service design

 Unsystematic new service development process

 Vague, undefined service designs

 Failure to connect service design to service positioning

 Absence of customer-driven standards

 Lack of customer-driven service standards

 Absence of process management to focus on customer requirements

 Absence of formal process for setting service quality goals

 Inappropriate physical evidence and

officer, and back officer) be working with the same concepts of the new services, based on customer needs and expectations For a service already exists, any attempt to improve it will also suffer unless everyone has the same vision of the service and associated issues

One of the most important ways to avoid gap 2 is to clearly design service without oversimplification, incompleteness, subjectivity, and bias To do so, tools are needed to ensure that new and existing services are developed and improved in as careful a manner as possible

The quality of services delivered by customer contact personnel is critically influenced by the standards against which they are evaluated and compensated Standard signals to contact personnel what the management priorities are and which types of performance really count When service standards are absent or when standards in place do not reflect customer expectations, quality of services they receive s likely to be enhanced If service standards are developed appropriately they can have powerful positive impact on closing both gap 1 and customer gap

Gap 3: Not delivering to service designs and standards

Gap 3 is discrepancy between development of customer-driven service standards and actual service performance by company employees

Finger 1.5: Provider Gap 3 (Parasuraman, A., Zeithaml, V.A and Berry,

L.L, 1991)

Even when guidelines exist for performing services well and treating customers correctly, high-quality service performance is not certainty Standards must be backed by appropriate resources (people, systems, and technology) and also must be enforced to be effective – that is, employees

Customer-Driven Service Designs and Standards

 Deficiencies in human resource policies

 Ineffective recruitment

 Role ambiguity and role conflict

 Inappropriate evaluation and compensation systems

 Lack of empowerment, perceived control, and teamwork

 Customers who do not fulfill roles

 Customers who lack knowledge of their roles and responsibilities

 Customers who negatively impact each other

 Problems with service intermediaries

 Channel conflict over objectives and performance

 Difficulty controlling quality and consistency

 Tension between empowerment and control

 Failure to match supply and demand

 Failure to smooth peaks and valleys of demand

 Inappropriate customer mix

 Overreliance on price to smooth demand

must be measured and compensated on the basis of performance along those standards Thus, even standards accurately reflect customers’ expectations, if company fails to provide support for those standards – if it does not facilitate, encourage, and require their achievement – standards do no good When the level of service delivery falls short of the standards, it falls short of what customers expect as well

Gap 4: Not matching performance to promises

Provider gap 4 illustrates the difference between service delivery and the service provider’s external communications Promises bade by a service company through its media adverting, sales force, and other communications may potentially raise customer expectations, the standards against which customers assess service quality The discrepancy between actual and promised service therefore has an adverse effect on customer gap

Finger 1.6: Provider Gap 4 (Parasuraman, A., Zeithaml, V.A and Berry,

L.L, 1991)

Broken promises can occur for many reasons: overpromising in advertising or personal selling, inadequate coordination between operation and marketing, and differences in policies and procedures across service outlets

One of the major difficulties associated with provider gap 4 is that

 Overpromising in personal selling

 Overpromising through physical evidence cues

 Inadequate horizontal communications

 Insufficient communication between sales and operations

 Insufficient communication between advertising and operations

 Differences in policies and procedures across branches or units

External communications to customers

G

A

P

4

communications to customer involve issues that cross organizational boundaries Because advertising promises what people do, and because what people can’t be controlled like machines that produce physical goods can be controlled, this type of communications involves functions other than the marketing department This type of marketing is what we call interactive marketing – the marketing between contact people and customer – and it must

be coordinated with the conventional type of external marketing used in product and service firms When employees who promote service do not fully understand the reality of service delivery, they are likely to make exaggerated promises or fail to communicate to customer aspects of the service intended to serve them well The result is poor service quality perception Effectively coordinating actual service delivery with external communications, therefore, narrow provider gap 4 and favorably affects customer gap as well

In summary, service quality is created from all organization’s operation procedures, and it is measured by how well organization can shorten its gaps, included customer gap and provider gaps The key to close provider gaps is to close gap 1 through gap 4 and keep them closed

The full conceptual model in figure 1.6 provides clear message to manager wishing to improve service quality The gap model of service quality serves

as a framework for service organizations attempting to improve service quality and service marketing

In order to make it easy to define, some organizations put all gap with some clear main questions and score them, then they can position their quality service and point out where they have to focus on to improve their service quality By this way, Gap model is called Service quality gap model audit Service quality gap model audit:

1 Market research orientation

Is the amount and type of market research adequate to understand

customer expectations of service?

Does the company use this information in decisions about service

provision?

2 Upward communication

Do managers and customer interact enough for management to know

what customer expect?

Do contact people tell management what customer expects?

3 Relationship focus

To what extent does the company understand the expectations of

different customer segments?

To what extent does the company focus on relationships with

customer rather than transactions?

4 Service recovery

How effective are the recovery efforts of organization?

How well does the organization plan for service failure?

1 = poor

excellent

Score for Provider gap 1

Provider gap 2:

5 Systematic service design

How effective is the company’s service development process?

How well new services are defined for customers and employees?

6 Presence of customer – define standard

How effective are the company’s service standard?

Are they defined to correspond to customer expectations?

How effective is the process for setting and tracking service quality

goals?

7 Appropriate physical evidence and services cape

How appropriate, attractive and effective are the company’s physical

facilities, equipment and other tangibles?

Score for provider gap 2

1 = poor

excellent

Provider gap 3:

8 Effective human resource policies

How effective does the company recruit, hire, train, compensate, and

empower employees?

Is service quality delivery consistent across employees, teams, units,

and branches?

9 Effective role fulfillment by customer

Do customers understand their roles and responsibilities?

Does the company manage customers to fulfill their roles, especially

customers that are incompatible?

10 Effective alignment with service intermediaries

1 = poor

excellent

How well are the service intermediaries aligned with the company?

Is there conflict over objectives and performance, cost and reward?

Is service quality delivery consistent across the outlets?

11 Alignment of supply and demand

How well is the company able to match supply with demand

fluctuation?

Score for provider gap 3

Provider gap 4:

12 Integrated service marketing communications

How well do all company communications – including the

interactions between company’s employees and customers – express

the same message and level of service quality?

13 Effective management of customer expectations

How well does the company communicate to customers about what

will be provided to them?

14 Accurate promising in advertising and personal selling

Does the company avoid over-promising and overselling?

15 Adequate horizontal communications

How well do different parts of the organization communicate with

each other so that service quality equals what is promised?

Score for provider gap 4

to improve their service quality

CHAPTER 2: TECHCOMBANK CASE STUDY

2.1 TECHCOMBANK AND CURRENT ACCOUNT SERVICES

2.1.1 Techcombank overview

Vietnam Technological and Commercial Joint- stock Bank - Techcombank was established on September 27th, 1993 with the initial registered capital of VND 20 billion with the aim to become an efficient financial intermediary bridging the savers with the investors in need of capital for business and economic development in the open-door era The head office was at 24 Ly Thuong Kiet, Hanoi, Vietnam

1995

The registered capital was increased to VND 51.495 billion Parallel with this event, the Ho Chi Minh City branch was established starting the process of fast expansion of Techcombank in the main urban areas

1996

Thang Long branch and Nguyen Chi Thanh sub-branch were established in Hanoi, together with Thang Loi sub-branch in Ho Chi Minh city The Bank’s registered capital has increased to VND 70 billion

1998

The head office was moved to Techcombank building at 15 Dao Duy Tu str., Hanoi, Vietnam With the establishment of Da Nang branch in the same year the branch network has covered all three main regions: the North, Central provinces, and the South

1999

Techcombank increased the registered capital to VND 80.020 Billion The Sub-branch No 3 at Kham Thien str was founded

2001

The registered capital was increased to VND 102.345 Billion Signed a contract with a leading software supplier Temenos Holding NV to implement new banking software GLOBUS over the network of Techcombank to meet the growing demand from customers

2002

A number of branches were established: Chuong Duong and Hoan Kiem in Hanoi, Hai Phong branch in Hai Phong City, Thanh Khe in Da Nang and Tan Binh in Ho Chi Minh City

Techcombank becomes the joint stock bank with the largest network in Hanoi The network involves the Head Office, 8 branches and 4 sub-branches

at the larges cities in Vietnam

The registered capital has increased to VND 104.435 billion Preparations are underway for an increase to VND 202 Billion in registered capital Techcombank reassures its role as a leading joint stock commercial bank in Vietnam

2003

Leveraging on the Globus system and the Bank’s alliance with Vietcombank,

The Bank inaugurates the completion of deployment of the Globus system on the whole network on 16 December 2003

The Bank started the process of developing a new corporate identity

Techcombank Cho lon was established Registered capital has increased to VND 180 billion at 31 December 2004

2004

Inaugurate the new identity of the Bank on 09 June 2004

Registered capital has increased to VND 234 billion at 30 June 2004; VND 252.2 billion on 2 August 2004; VND 262 billion on 20 September 2004 and VND 412.7 billion on 30 November 2004

The number of branches increased from 15 branches to 25 by December

21/07/2005, 28/09/2005, 28/10/2005: Raised registered capital to 453 billions dong, 498 billions dong and 555 billions dong, respectively

29/09/2005: Launched the new Switching and Card Management System of Compass Plus

03/12/2005: Upgraded the corebanking system to the latest version of Temenos T24 R5

2006

Receiving the award for international payment from the bank of NewYorks, Citibank, Wachovia

In August 2006: Issuing Loc Xuan Saving Certificate

In May 2006: Receiving golden cup for “a better society and stable development” given by Viet Nam General federation of labor

In June 2006: Call Centre & Hot line 04 9427444 officially operated ( 24/7)

In August 2006: Moody’s, the world top ranking reputed organization has declared reputed ranking for Techcombank, the first joint stock bank of Viet Nam ranked by Moody’s

In August 2006: the annual shareholders meeting approved the plan for 2010; Techcombank and Bao Viet Insurance corporately proving Ban cassurance

2006-In September 2006: Completing the account system with new products: multifunctional savings, period interests paying savings

On 24th November 2006: Raising the chattered capital to 1.500 billion dong

On 15th December 2006: launching the international Techcombank Visa card

2007

Techcombank total asset up to 2.5 billion USD

Becoming the joint stock bank with the second largest transaction network including 130 branches, TSO at the end of 2007

HSBC increases the sharing capital to 15 %, directly and sufficiently support Techcombank’s operation

Profoundly transforming in structures with the establishment of corporate service department, department of credit and risk management, completing structure of banking service and individual finance

Upgrading the core banking system to T24R06

Is the blossoming year of card services with the total issued card number up to more than 200.000 cards for all kinds?

The first and only bank approved the achievement in technological application and leading in market developing measures

Implementing the “secret customers” program, in order to access the service

quality and attitude to customers of front-line staffs at Techcombank TSO Launching many new products, including: Savings lucky draw “ A chance to receive Mercedes with saving in Techcombank”, “ regular saving”, “loans for assumption”, products for enterprises such as supporting suppliers, F@st I-bank- products based on high technological products, products on account management of securities investors F@st S-bank and electronic paying gate providing online payment for e-commerce website F@stVietpay

Receiving award “Top Trade services 2007”- award given by Ministry of industry and Commerce for typical enterprises, operating in trade services that Viet Nam committed to implement as joining WTO

2008

Receiving award of “the most satisfied service in 2008” voted by readers of Sai Gon Tiep Thi magazines in February 2008

In March 2008: Launching Techcombank Visa Credit card

In May 2008: Launching Cash Deposit machine (ADM)

Implementing many projects on technological modernization: upgrading the core banking system to sample T24 R7, member of two cooperated card organization Smart link and Bank net, connecting ATM system with strategic partner HSBC, opening free Call Centre ( 24/7) 1800 588 822

The unique sponsor for “Sao Mai Diem Hen 2008” in June 2008

Opening Techcombank AMC (asset management company) in 8th August

In September 2008: Launching Techcombank Co-brand Visa card with Vietnam Airlines

On 19th October 2008: Receiving award “reputed securities trademarks and the top Joint stock company of Vietnam” given by securities committee

- Online saving products were introduced

- Reception of the “top 500 largest enterprises in Vietnam 2009” title, awarded by Vietnam report

- Reception of the “Global payment Excellence” Award, given by Citi Bank, Wachovia Bank and The Bank of New York

- Initiated the transformation strategy with the support from the world’s leading strategic consulting firm McKinsey & Co

2010

Deployed a number of transformation initiatives in general, announced the bank’s Mission, Vision and Core Values Simultaneously, the bank implemented its business and management model restructuring and transforming corporate culture

April/2010: Achieved the “International star for Leadership in Quality” award, given by Business Initiative Directions

May/2010: Received “The Vietnam values 2010” title

2009&2010” Award, given by the IFC – International finance corporation June/2010: Received the “Global payment Excellence” Award, given by Citi Bank

June/2010: Increased the registered capital to VND 6932 Billions

July/2010: Received the “Best Bank in Vietnam 2010” award, given by Euro Money magazine

August/2010: Received the “Vietnam Gold Star” award, given by the Young Entrepreneur Association

May/2011: Received the “Inspirational Company” award from the Confederation of businesses

From June/2011 to August/2011: Received 8 prestigious awards from a number of trusted international organizations, including:

- “The Best Bank in Vietnam”; “The Best Cash Management Bank in Vietnam” and “The Best Trade Bank in Vietnam” awarded by Finance Asia magazine

- “The Best Bank in Vietnam”; “The Best Cash Management Bank in Vietnam” and “The Best Trade Bank in Vietnam” awarded by Alpha South East Asia magazine

- “The Best FX provider in Vietnam” awarded by Asia money magazine

Asset magazine

2012

Upgrading the core banking system to T24R10

The head office was moved to Techcombank Tower at 191Ba Trieu str., Hanoi, Vietnam

2.1.2 Techcombank current account strategy and ambitious plan to 2014

Vietcombank, Agribank and Dong A Bank claim over 60% share of accounts Concentration in Hanoi leads to Vietcombank, Agribank, Vietninbank and TCB accounting for nearly 80% of all accounts Vietcombank, Dong A, Agribank and ACB dominate in HCMC

Vietcombank, Vietinbank and TCB most considered in Hanoi In Hochiminh City ACB is seriously challenged by Dong A bank TCB shows signs of entering the consideration set in HCMC but not yet at the level of conviction [Cimigo, Q1, 2012]

Base on current portfolio annalistic, internal capacity and market research

of customer behaviour, Techcombank has decided that “service” and

“convenience” to be the differentiated proposition to serve customers at different demand and lifecycle to achieve 10% penetration in affluent and mass affluent segment

Finger 2.1: Current account key proposition [TCB, 2011-2014 strategy]

CASA mix to be 10% by 2014 from 6% at present, 6% of which will come from current accounts and remain 4% from saving accounts

Table 2.1: Techcombank current account portfolio to 2014

2.1.2 Techcombank current account’s performance

highest margin of all other deposits and lending products

Following table is the comparisons of NIM – CAs to other products:

Table 2.2 : Techcombank CA NIM performance

Source: TCB, 1st half of 2012 retail report

CA’s margins were 26 times of time deposits’ - the biggest contribution to PFS portfolio

CA’s margins were almost 3 times of mortgages - the biggest contribution

Table 2.3 : Techcombank CA multiple-service Customer ratio

Source: TCB, 1st half of 2012 retail report

At present, Techcombank officially offer 4 types of current accounts to customers: normal account, payroll account, Dynamic account, F@st Easy 2 others are in pilot at some selected braches: Invest account and house hold account

Walk-in customers often choose normal account, as it’s simple with litter fee Payroll, sold to whom receive salary through Techcombank current accounts,

is a primary acquisition channel: 63% of new account acquire through payroll Dynamic account aims to customers who are active, ready to enjoy new technologies and services

F@st Easy is a package for customers who have big demand of daily transactions with big volume Target customers of this package requires a great support from bank to make their transaction done in the most convenience way

Table 2.4 : Techcombank CA’s balance portfolio by products

Source: TCB, 1st half of 2012 retail report

68% of the balance comes from normal accounts; follow by 29% form Payroll While bundle products, which is designed for high-classed customers, like Dynamic, F@st Easy, seem to be in trouble

RELATIONSHIP MANAGEMENT

2.2.1 CRM department

From 2009, PFS (personal financial service) division was set up to centralized and specialized manage and serve individual customers

Customers are recognized by ID which is unique for each customer

From 2010, ACI center (Analytics & Customer Intelligence) of PFS has taken over all tasks of business analyst base on looking deeply inside customer banking activities

From June 2011, one team in ACI was selected into CRM department Tasks for CRM department is dealing with partner to build up professional system with up-to-dated data warehouse which support the bank switch from

“Analysis” to “Action” to better serve customers

2.2.2 CRM in process

- Validate strategic intent (vision)

o Understand the direction for where TCB wants to be in 3-5 years

o Set vision and financial gold

- Diagnose current operating model

o Understand the current business environment

o Understand the current technological capacity

o Best practice sharing and benchmarking

- Design target operating model

o Design operating model with defined key capabilities – customer experience, process, people/organization and technology infrastructure

o Incorporate some of the best practices in customer centric operating model

- Develop roadmap

o Define CRM transformation plan with integrated set of initiatives

o Provides a detailed description of a roadmap for implementation of the operating model components

o Business cases

o Develop RFP for CRM implementation

2.3 A REVIEW OF TECHCOMBANK’S SURVEY ON CURRENT ACCOUNTS SERVICE

2.3.1 Survey objective