Case Presentation on

Commerce Bank

Group Representative: Shyam Sundar GourIndian Institute of Management Calcutta (IIMC)

EPSM 08Speak:+919351961181

Commerce Bank’s service delivery system prior to Retailtainment

Introduction: founded in 1973, 10minutes rule, friendly service, Business Model: Giving the best of service channel experience, Attracting customer to branches versus industry pushing them into online, average footprints 40000 Per month, lower deposit rates, 50% consumer business,

“Wow”SMART Principles :Say yes to customers, Make each customer feel special, Keep Customer Promises, Think like the customer,Wow Awards.• Hallowean Costumes

• Decorated Cubicles

• Changing the perspective from Branches to Stores

• Comparison in operational excellence with retailers such as Star bucks.

• Free coffee and newspapers to customers.

• Phones added to Commerce ATM Machines.

• Penny arcades.

How well does the company’s operations design support its competitive position?

• Positioned as: “America’s most convenient bank.”

• Working with Wowing customers philosophy

• When it rained the bank employees often escorted the customers to the care with umbrella.

• Initiative of opening up the bank on Sunday to communicate the message “I am always there”.

• “Kill the stupid rule programme”.

What decisions do you find critical to the Bank’s success?

• Building Trust on the brand.• Exceeding service expectations• Consistency in the Interiors, Exterior, and service across geographies.• Location.• Innovation- Penny arcades• Manpower: Local experienced talents, Retention, Raving Enthusiasts Employees,

Rewards on extraordinary service delivery.• Playful environment.• Commerce Vans.• Dress for call center executives.

What was the motivation for the Retailtainment program? How well did Retailtainment meet these goals? How if at all would you modify the program?

Retailtainment: Objective: To improve the service experienceNeed: Competitors started copying the Commerce bank’s service models-Jugglers-free hot dogs-guitar player-Employee on roller blades.

Suggestions: Centralized Retailtainment.

What would you advise as the competitive response to commerce bank’s market entry?

“Reducing the waiting time into branches along with extraordinary services.”

Briefly look at the financial statements for Commerce bank and the industry (exhibit 1 -4). Do you see support, or cause for concern, of the bank’s strategy in the financial statements?

 Support-Total Interest Income grown by 12% YoY in 2001 for commerce bank versus decline in industry.

-2x Net income from 1998 to 2001 versus almost stagnant net income in the industry.

-37% Growth in deposits versus 2% for Industry...

Concern-Loan to deposit ratio for commerce bank was less

-High expense ration for commerce bank.

Thanks