Customer Relationship Management (CRM) of Halifax Bank

Chapter 1: Introduction and Background

Service industries become more and more crucial in every aspects of business form the last two decades. According to McDonald and Leopard (1990) multiplication of the service industries have been observed in many countries. The extents of service industries become evident on national economy (Baker, 2003).  Service industries are expected to be more significant in upcoming future. As it becomes stronger instrument to the modern economy the clients are now getting more choices and easy availability. Therefore, it has become harder for the service oriented firm to do stable business. Moreover, continuous flow of new comers and innovative approaches by the competitors make it harder. Thus, the circumstances bring the challenges for each company on modern business world that ultimately force them to review and sometime dramatically new adapt their management styles and business practice (Teare, Mountinho & Morgan, 1990). Historically we have been observed that marketing and customer service was viewed as providing right product at right place and right time. In short, it was focused on distribution and logistics. However, the new dimensions of customer service has emerged which focused on client needs and preferences (Christopher, Payne & Ballantvne, 1993).

If we look back to the history of the customer care by financial organization we can see that they are using market segmentation techniques in order to prevent losing customers. Within these techniques customer had same needs were put together in one group or segment (Bose, 2002). From 1980, the view of relationship marketing has developed in order to overcome the above problem. Relationship marketing was constructed due to gain customer loyalty and satisfaction. These started from the selling of quality goods to be sold and keeping an excellent relationship with the customers (Levitt). Again, Gronroos (1996) states that in order to maintain and establish relationship with the customers and other business partner the objective of the partners should be met. Marketing in the past were more concentrated on attracting new customer and clients rather than retaining customers. Here, the transactional or traditional marketing approach was replaced by the relationship marketing where customer retaining focused more than anything. The transactional marketing emphasis on 4P’s namely product, price, place and promotion. These four factors essentially focused on attracting new customers for the organizations Gummesson, 1987). Gummesson (1999) states that relationship marketing should include reduction of costs put more security; assess risk management, trust build and control. In 1990, the scholars start the thinking paradigm about the essence of customer relationship. It was realized that customers are interacting both the marketing department and as organization whole. Therefore, evolve of customer care has come to the customers.

Due to the arising complexity on service related industries it has now become demand of time to create loyal customer base and loyal customer can be created and ensured through good level of practising customer relationship management strategies and standard level of service. Customer relationship management can be defined as the modern business strategies that integrate internal process and functions and external networks to build up and provide value to potential customers at a profit (Buttle, 2004). Furthermore, it can be illustrated as a comprehensive set of activities that envelop all meanings of the firm interacting with and supporting a consumer. Thus way customer expectations are met and customer level of satisfaction increased. Customer relationship management does affect on service quality of any business organization. In 1990’s the marketing of service industries start to influence relationships with the customers (Swartz & Lacobuchi, 2000:96). The customer relationship makes certain that the customers are developing the consumers view on customization, appreciation and friendly service. The above things lead in supporting loyalty of the customers.

Banking institutions become more motivated to adopt CRM strategies for both defensive and offensive reasons. The banking firms are taking offensive strategies in order to bring positive improvement of profitability by reducing operating cost. Buttle (2004) states that defensive arguments are applicable when an organization’s leading competitors have adopted CRM successfully. The underlying assumptions behind why a firm want to keep a good relationship with the customers are based on economic considerations. Firms could bring better results when they could able to successfully manage their customer in such a way that they identify and the needs of the customer by increasing customer satisfaction and subsequently increasing customer loyalty (Wilmshurt & Mackay, 2002:346; Mudie &  Cottam, 1999:257). It is generally indicated that effective CRM strategies can show the way to many beneficiary for a firm, but the scope of the policies which would be implemented by the business institution. There have many financial institutions in the United Kingdom who realize now the extensive research on this field is required. The customer relationship management therefore can also be regarded as one of the indicator of the quality of the customer satisfaction and customer service.

In reality most of the people in the United Kingdom have the access of banking facilities and almost all of the banks are exercising unique way and their own tools and techniques to keep maintain the relationship with their customers. Again, the continuous changing competitive world makes financial institutions to be more innovative and unique approach to use latest customer relationship management techniques to sustain in the market and make a sense of quality service in their customers mind. The banks will be able to do higher level of service and sustain on continuous increasing competitive, complex and challenging environment if they could able to retain their customers. The loyal customer can be created through an excellent customer services. The banking sectors in the United Kingdom is one of the most competitive firms in financial industries therefore customer management service is concerned. The issues that leads to force to devastate strategic objective is called customer focused strategy. The success of any service firm to build more sustainable and profitable relationships with the customers is called customer relationship management.

Statement of the problem:

The most of the banking institutions have come to realize that the customers are the main centre point of any business. In order to effective managing the relationship with them there are strategic policies is required. The systematic management of them are the core task of customer relationship management. The ultimate objective of all customer relationship management is to make customer happy because they are the blood supplier of any business especially in financial industries. It is generally assumed that technology is supporting the business with the systems and software that helped them to keep maintaining regular communication with the customer and subsequently the significant improvement of the services.

 With the help of the customer relationship management software the financial institution like as bank track customer’s interaction and get the required information about the customers as well. The system is ultimately helped to increase the noteworthy improvement and also lead to get closer to the customers. Through this process banking industries maximize their ability of enhancing further business with the existing customers as well. The customer relationship effort leads marketing is this sense. Information technology and information system here is the main supporting key that successfully worked to the linked with CRM.

Although, there have strong support given by the authorities of Halifax bank in the United Kingdom but still it seems to do further actions in order to compete with the other competitors. Here, it should be mentioned that some of the employees are not adequate updated to use the newly introducing software to manage customer relationship. Therefore, the expected successes in certain sectors are less attained compared to its targeted expectations. By realizing the significance of the contribution of CRM the banking institutions in the United Kingdom are bringing the continuous change in maintaining banking business and would be helpful to strengthen the level of confidence of the customers.

Importance of the study

Customer Relationship management is the strongest and the most efficient approach in maintaining and creating relationships with customers. Customer relationship management is not only pure business but also ideate strong personal bonding within people. Development of this type of bonding drives the business to new levels of success. In today’s commercial world, practice of dealing with existing customers and thriving business by getting more customers into loop is predominant and is mere a dilemma. Installing a CRM system can definitely improve the situation and help in challenging the new ways of marketing and business in an efficient manner. Hence in the era of business every organization should do some sort of research on customer relationship management.

Profile of the organization

Halifax bank was established in 1853 at Yorkshire. Initially the bank was established as a part of the building society in order to appeal the investors and allowing people to get engaged in business. Initially, bank starts working to offer loan for the investors to make homes. Later on, in 1913 the bank became largest building society in the United Kingdom. Bank started their first office in London in 1924 and in 1915 in Scotland as part of the Lloyds banking group (Rob Wagner, 2000).

Their main markets are in the UK, although they have a growing presence in Australia and Ireland along with premises in mainland Europe and North America. It was UK’s largest building society since 1913. It has de-mutualised in 1997 and becoming Halifax plc which is later on part of stock exchange. In 2001, Halifax plc makes collaboration with governor and the bank of Scotland and named as HBOS. As a consequence, the HBOS helped them to legally transfer the assets and liabilities of the Halifax chain to Bank of Scotland under the act of Group Reorganisation Act, 2006.  Formally it becomes a part of the Lloyds Banking Group after having an approval by the court session on 12 January 2009, and on 19 January 2009. The bank has a unique slogan of “A Little Extra Help”.

Halifax has able to make good number customer of customers by the time being. Through the unique customer service, Halifax has successfully able to achieve a good customer image and positive impression through their unique products.  Halifax has gained at current level of customer relationship as they have a strong infrastructure and customer relationship management system. As the company realized the necessity of the product variety it has able to attract more potential customers. Thus, Halifax bank is stands one of the five major banks in the United Kingdom.

Aim of the study:

This study will bring the overall scenarios of customer relationship management used in banking system in UK and customer views on it. Moreover, the study will try to find out the underlying factors of service quality in financial institutions. Finally, it will be helpful to enrich the existing knowledge and research on banking institutions and hopefully lead to further research as well.

Research Questions:

Specifically the following research question would be examined under this study:

  • What is the role of different customer relationship management factors on service quality of the banking institution?
  • What are the different tools and techniques Halifax bank uses in order to practicing relationship management and how they use it?
  • How customer relationship management techniques can contribute customer loyalty and customer retention?
  • What are the possible measures in order to improve the overall quality of customer relationship management and service quality in banking sectors?

Objectives of the study:

The primary objective of this study is to investigate the efficiency of the banking services in the UK and to find out the major tools and techniques used by the bank in customer relationship management. The study also intended to examine the customer perception about the banking services they are getting from the bank and their expectations as well. Specifically this study will conduct to attain following objectives:

  • To find out the role of customer relationship management factors on service quality of the banking institutions.
  • To identify the tools of customer relationship management used by the Halifax bank.
  • To investigate the influence of customer relationship management in creating customer loyalty and retention.
  • To propose a scientific methods of customer relationship management techniques in order to improve the quality of customer service.

Justifications  of the study:

According to Nelson (2002) the majority of the research found that customer relationship management has failed to meet customer expectation and it lies to 40% to 80%. These measurements are the reflections of the necessity of inventing the true facts behind successful customer relationship management system. Let’s consider the following two different scenarios in most of the company’s doing in customer relationship management.

  • People usually blamed easily to the software providers for the failure of certain system but they do not consider the other grounds liable to this. This is happened due to the fact that sometime the companies are spending money on CRM without considering their customer expectations (Dignan, 2002).
  • Sometime CRM projects are more difficult in reality than imagination. With the comparison of enterprise resource planning implementations is almost similar with the company’s CRM system and it is more competitive. Therefore, the decision lies to the company on how this would be implemented that make company unique from the others.

Therefore, most CRM implementations are risky and proper strategy should be prepared through conducting an objective research.

Layout of the dissertation:

This dissertation is presented in six chapters. Chapter one is all about the description about the background and rationality of conducting this research. The chapter also describe the major research issues and major objectives of the study.

Chapter two describes the related literature and major study findings of the previous research conducting under the similar research. This chapter furthermore illustrates the major issues related to the concept of customer relationship management. It also focuses role and multiple application of relationship marketing for UK banking sector focusing on Halifax bank.

Chapter Three Illustrates the methodology adopted in order to conduct this research. Chapter explained giving parameters for the research philosophy, research strategies, and techniques of data collection, data collection process and guideline about how data will be analyzed. Moreover this chapter reviewed related documents on customer relationship management.

Chapter Four presents the documentation of the field data. The finding of the study starts to explain from the demographic characteristics of the customers to their personal view regarding the quality of the banking services. At the second part of this chapter the author tried to illustrates the major findings he has revealed from the research on the different tools and useable techniques in the operation of Halifax bank.  The author also tried to explain and interpret practice of customer relationship management analysis to respond to the problem statement of this dissertation.

Chapter five is all about discussion on the major quantitative similarities and dissimilarities of the study that illustrates researcher findings with other research. It also interpreted by the researcher to explain any significant and emergent information that might support or reject the intent of this dissertation.

Final chapter which is chapter five ends the dissertation with conclusion and recommendations. This chapter also presents the limitation of the research and as well as suggestions for future study.


In conclusion, it can be said that chapter one is the beginning part of this dissertation. It explains the logical issues of conducting this study. It provides the audience regarding the major objectives of the study and a brief description about the growth and development of organization.

Chapter Two: Review of Literature


Under this chapter the researcher would like to discuss the theoretical frame work of the study based on the major theories on CRM and service quality. The major key findings of the previous research on the CRM role in banking sector will also be discussed. The chapter will also highlight the gap in exiting research in this field and try to establish the logical drawbacks of conducting this research. We have been observed from the last two decades that the service industries the especially financial institution have proliferated in many countries. The financial institutions have come to realize the growing importance of the services and customer relationship in current contemporary competitive economic world (Rust & Oliver, 1994:1).

The number of research shows that the relationship marketing revamped the quality of the banking service in the United Kingdom. It also positive contribute the Gross domestic product of the countries. In Scotland, the figure of this contribution rises 53% in 1960 to 66% in 1995 (Gronroos, 2000:1). The service industry will positively contribute in national economic growth in future and even accelerate in future. The strong role of CRM has already created a strong competitive business environment. This violent competitive business environment are forcing the financial institutions are to evaluate and often adapt their management styles and business traditions in marketing activities (Teare et al, 1990:1). All essential issues of service related firms in this competitive business world established the broad uses of CRM. It has been used by service firms in order to get the competitive benefit of CRM.

Differentiations among CMR concepts

The consumer, customer and client these three are the most useful word in customer relationship management. It is required to discuss the major difference between each concept. Although there have been no precise differentiation has made yet between concepts of consumer and customer then different author illustrate it in different angle (Gray, 2005:66). Many scholars use the terms consumer and customer in same way without offering a further explanation. The objective of this study is the concept of consumer is used to illustrate a person in the context where services are more evident. Particularly in the banking services the use of both terms are popular. The term customer refers to people who buy or purchases a particular product whereas a client refers to people who are making uses of the services of a commercial bank.

Here it should be noted that the customer relationship management is widely used concepts that played a strong role in keeping relationships of the producer and marketer of physical products and management of service firm to build relationship with the customers.

Relationship marketing and management

Relationship marketing and relationship management both are the business practices that focused on clients. Any organization especially financial organization can grow new clients in following ways (Swartz & lacobuchi, 2000:319):

  • Attracting the new customers.
  • Persuading the existing customers to make regular make use of the services.
  • Encouraging the existing customers to make further purchase to get higher valued profits.
  • Reducing the area of returns of existing clients in completion of better business interest and
  • Eliminate the meaningless client relationship and make possible new ways of making good relationship with them.

All these above tasks are related to customer relationship marketing. In every business the service relationship, the both parties expect to have a periodic communication related to their interests. Again, within this relationships, the interested parties become inter-dependent and make benefited for the both cooperate. It can be described as inter- dependent relationship which is beneficial for the both parties. Here, the service providing firms should offer an adequate level and manner of services if the client behaved appropriately. It is expected to be a relationships where a number of times both parties would share communication on mutual interest (Swartz & Lacobuchi, 2000:371). As the market appear to be increasingly competitive, the better relationships development with the clients can be uphold a method of creating a sustainable competitive advantage. This holds are very strong way of CRM service that holds many inducement of relationships that can be create more new customers moves the audience in particular products. The professional services like legal support, banking, consulting are very much rewarded in considering the strong relationships with the clients that vitally important for service firms.

Generally, the relationship between customer and service providing organization usually constructed in two different ways. The first way is to attracting the customer by their products and secondly building and managing the long term relationship with the existing customers so that the economic and business objective of the both parties will keep. At the first stage, attracting, establishing or creating these is the concepts that make the basis of a continuous or long term relationship over the time. Relationship marketing is viewed as building relationships and networks and ensuring interaction (Baker, 2003:33). During the second phase, when service provider attempts to maintaining and enhancing continuous relationships with the customers and retain them in the business it is called customer relationship management (Swartz & Lacobucci, 2000). Thus, the customer relationship management view shows the way to the business developer the necessity of focusing marketing relationship (Payne et al, 1995).

Descriptions of CRM

On the contemporary world, the CRM has emerged as most important business instrument in developing long term business. According to Buttle (2004) CRM is not only a crucial instrument to gain business gain for a financial institutions but also become a necessity for business survival instruments. Customer relationship management is still new concept in many countries but becoming more significant issues in day by day. It makes a long term relationship with the customers. Through the CRM process a company used to gain long term relationship with the customers and gain their confidence and loyalty. The company can gain this through value added strategies and reward that aimed at sharing with the customer (Wayland & Cole, 1997).

Leboeuf (1987) has identified five ways to keep a customer in coming back in a business which are be reliable, be credible, be attractive, be responsive and be empathetic. Mastour and Boumaiza (2011) state that customer relationship management approach that is mechanism to retain customers in a business for long term profits. Again, Fay (1995) states that there are two conditions that associated with the customer loyalty i.e. customer retention and share of the total customers. In order to ensure a good implementation of customer relationship management implementation the issues of addressing the customer service and the way they are getting the services are relatively important (Ling & Yen, 2011). According to Lovelock (1991) customer relationship management is designed and performed in purpose of serving with two goals in mind which are operational efficiency and customer satisfaction. As service quality is by nature a subjective concept, thus the understanding of how the customer think about service quality is essential in ensuring effective relationship management (Oliver, 1994). Customer service creates the moments of truth with the customer, and these service encounters need to be managed by the organization (Payne et al, 2001).

The evolving of production oriented business has developed from the market orientation culture regarding marketing orientation. Whereas, in the past organization focused on leading revenue by minimizing production costs they are now changed to become to introduce sales orientation policies. The ultimate objectives of these policies were the increasing profits through increasing sales. Earlier, the organizations were hopeful in identifying client needs and providing value for the customers. At present, they are becoming more focused organization in satisfying customers. Therefore, it has become a requirement for focusing the entire firm in identifying the customer needs and expectation. With the help of CRM system the organization can easily and efficiently handled these issues in shortest period of time. Thus, the value is created for the customers (Gordon, 1998:9). The overall system of servicing delivery thus is customised for the individual client’s needs.

With the time being, the CRM has now established as the core business strategy for integrating internal process and functions of any corporate organizations for delivering valued services to the targeted customers (Buttle, 2004). Moreover, Gordon (1998) states that in business it is a continuous task of creating new value with the clients and share the benefits with the customers and organization through life time association.

Frameworks on CRM

Gratner (2008) states that CRM is an information technology based business strategy that leads to optimize further business and profitability. This system enable an organization in order to optimize profitability, more revenue and better customer satisfaction by providing customer segmentation. Forecasting customer-satisfying behaviour and implementing a customer-centric process. We can find the similar view from the Bose (2002) who states that CRM involve the integration of information technology in order to satisfying the clients need. In the banking sector it integrates different functions such as data simulation, telephone based customer service, accounting the customer value, web site information, sales marketing and new product information sharing.

Classification of CRM

  • Operational CRM system:

The operational system that influence the overall business process and the overall efficiency of the system such as marketing automation, further sales automation and customer management interation is enacted with this system.

  • Analytical CRM system:

This is the database about the customers that tries to link up the information with different business strategies and new packages. This system provide a solution for data mining and data warehousing.

  • Collaborative CRM system:

This is the central communication system with the customers that pass the information in different channels. In broader aspects, it exchanges the required for the customers in order to make them able to shape their compliment, get access to the services etc.

  • Electronic CRM system:

Automatic response to customers’ emails, automatic help and several other personalized services comes under this category.

Benefits of CRM in an organization:

The significance of CRM is well established in many organizations, especially organizations that have stable customer and strong financial bondage with the customers (Lin& Su, 2003).  As a strategic approach, CRM has a strong role in maintaining valuable and long term relationships with the customers. It also extends the opportunities for the firms in exchanging new products to the customers. In this sense, CRM provides an opportunity for the business firm in acquainting itself with its clients’ needs and change its service delivery to meet business requirement. The primary motivation of building a relationship with the clients is the economic attainment (Buttle, 2004:16).

From the effective CRM system both parties can be benefited. The organization can be benefited such a way that company can understand better ways that help them to make future marketing strategies. In 1992 Webster describes those industrial marketers that might help the organization in delivering more value for the services to the customers. Furthermore, superior customer value is ensured through this process. By this way a company can retain their customer with the business for longer period of time. In this respects, service satisfaction, product quality and committed customer relationship helped them to make stable business which can effectively be established through systematic customer relationship management system.

Apart from the organization, CRM systems also help to get more satisfactory service for the customers as well. It helps in many ways such as psychologically it make closer to the organization; socially in enable them to make friendship, personal recognition and familiarity; economically it benefits customer to enjoy more discount, money saving scheme and customer loyalty (Peterson, 1995). In the interest of obtaining and enjoying long term relationship with and commitment with both parties there should ensure the sharing the mutual trust, good communication and consideration of both parties interest. The some authors believe that trust, commitment and bonds hold an important role in building up a strong relationship for both business and customers.

It is the underlying objective of CRM strategies that firm would accelerate better result through managing clients by identifying and retaining most loyal customers. In fact, CRM helped to accelerate the revenue of the firm and overall profit as well. By considering this fact, the most of the organizations has started the further investment in CRM as a prime concern (Kennedy, 2004). Actually, the most of the business firm has confirmed that in order to be sustain in competitive business world they needs to build more strong relationships with their customers (Erwee, 2004:1).

The key benefits of CRM have been listed below:

  • Through this approach the company can growth their business rapidly and customers become more satisfied as well.
  • Organization becomes more service oriented and their functions become handled a smooth way.
  • Sales force automated in large scale.
  • Customer information becomes integrated in company’s database in systematic way.
  • The deficiency in the system processes eliminated in scientific way.
  • It reduces the operational cost of an organizational and reduces the cost behind this as well.
  • Brand image has established through this process and it develops in shortest period of time.
  • It generates to create an organization a central database about their customers so that everyone in your company can keep track of customer contacts.
  • Sales and marketing teams enjoy the benefits from having all this inside knowledge about customers.

Function of services

Everywhere the organizations are transforming a resource based organizations to service based economy. In the United Kingdom this trend is much more evident due to the need of current customers and necessary to compete with global markets (Moreo, 1996:1). Service qualities provided by different financial institutions in the United Kingdom are quite satisfactory though customer expectations are much higher (Nel, 1992). Due to the wide role of service on present world, services become the vital part of the country’s overall national economic conditions. Whenever the similar organizations will offer the services at the same prices the factor will be the quality of services for the customers in choosing their right products.

Definition of service quality

It is required to define definition of service quality under this study. The service quality is an elusive indistinct construction. When a firm could successfully able to meet the requirement and expectations of the customers than are easily attract new customers and service quality are met. However, its importance to firms and consumers is unequivocal (Parasuraman, Zeithaml & Berry, 1985:41). For the purpose of this study, it is important to briefly discuss the evolution of the concept “quality”. Quality in general (pertaining to physical products) and more specifically service quality will be discussed. During the 1970, the quality was considered as the indicator of customer satisfaction with the compliance of specific product expectations to gain feeling of trust (Parry, 1973:15).

Most of the thinkers recognize that CRM system in financial institution help an organization in strategic perspective that ultimately leads them in focusing customer information in multiple ways. Customer relationship management technologically advanced system like warehouse database, data mining can crucially function ate in technologies and business. According to Kotler (2000) customer relationship principally involve analyzing customer behaviour in deep sense. Therefore, CRM system in financial institution used to satisfy the business needs as well as a powerful means of enhancing their quality of service.

Service quality illustration

It is widely acknowledged that efforts to define and measure the quality of products have been more successful than the definition and measurement of service quality (Mudie & Cottam, 1999:81). Ideas and premises concerning product quality are not always directly transferable to service quality. Parasuraman, Zeithaml and Berry (1990) mention that service quality is more difficult for the consumer to evaluate than product quality. Service quality perceptions result from a comparison of consumer expectations with actual service performance. Additionally, service quality evaluations are not based solely on the outcome of a service, but also involve the evaluation of the process of service delivery. The client has fewer tangible aspects to evaluate when purchasing a service than when purchasing a product. For example, it is easier for a consumer to determine the quality of a motor vehicle than to measure the level of quality of banking services. Any information regarding a product or service is not always being possible to transfer to quality service (Mudie & Cottam, 1998).

According to the view of  Zeithami & Berry (1990) that, service quality is more difficult for the consumer to evaluate product quality. The service quality concept is derived from the comparison of the consumer expectations with the services they are really getting in a reality. In fact, service qualities of financial institutions are solely depending on insight feelings through the level of expectations of customers. The client has few degree of dependency when they purchase a service than purchasing a product. Therefore, it is generally said that measuring the quality of vehicle is easier for a certain consumer to determine the quality of a motor vehicle than to measure the level of quality of banking services.

The concept of service quality is very hard to define due to its unique nature of services.  The majority of services cannot be measured in certain quality scale because as it is intangible. The services are performances and précised quality indicators of an institution or organization. The products which are manufactured in a factory can be measured by the physical goods but the services which create some sort of feelings insight human being is quite different and cannot be measured in same way. In fact, it depends on several factors like as the way he has been treated by the service providing institutions.

The performance of each financial institution differs to each other. The consistent performance of this firm cannot be assured therefore, the delivery of service and intake of the service become inseparable. Thus, the quality of service come in the questions when the interaction between the client and service provider. This way, the customers influence and role of the customer become intangible in service delivery (Beckford, 2002). There have three theories existed on this perspective in measuring service quality and defining service quality. These theories are: attribute theory, customer satisfaction theory and customer interaction theory (Chase & Bowen, 1988). These theories can be used in measuring service quality in separately and independently in order to define service quality.

These issues are defined as below:

  • Attribute theory: The attribute theory concentrate on the characteristics of the service delivery process. Attribute theory believe that the management of an organization can change and manipulate the quality of the series of an organization. Especially in the financial institutions how their customers would get the services can be fixed by applying this theory. For instance, how would behave with a customer in a banking branch would be managed and influenced the attitude and manner is delivered would ultimately influence client view about the bank’s service quality.
  • The customer satisfaction theory: the customer satisfaction theory shows the difference between the customer expectation and the actual services they are getting in reality. In this regards if the banking services of a financial branches for example the perceived the service quality for clients will be the level of service they are getting from the organization and level of their expectation.
  • Interaction theory: The interaction theory states that the service quality of an organization is developed through the continuous interaction between the customers and the service providing organization. Here it should be mentioned that, the level of service quality depends on the degree of interaction was been done between the customers and the bank.

Depending on the above stated theories on service quality there have been emerged a lot of theories, definitions and concepts. Service quality means to the extent which a firm’s service meets the customers’ expectations (Muddie and Cottam, 1999). In addition to it, the service quality is also considered as the customers evaluations about the overall distinctions of a service (Zeithaml, 1988). Again, the service quality is defined as the gist impressions by the customers on the comparative goodness of services (Rust & Oliver, 1994).

Yet, service quality is a multidimensional concept of evaluating the services of an organization. A contemporary research by Parasuraman et al. (1985) revelled that the customers usually use almost similar indicator or scale in order to evaluate the quality of certain service. The most useful methods in this regard fall into ten key categories which is called service quality exterminator. These indicators are: reliability of the service, responsiveness of the service, capability of the company; access to the service for the customers, courtesy; mode of communication with the customers; credibility of the service; product and service security for the customers; understanding the customer’s needs and tangibles. This system was developed by Parasurman, Zeithaml & Berry in 1988 which is called SERVQUAL. The ten service quality indicators and their brief descriptions provide an outline of the service-quality scale.

 The brief illustrations about service quality model are given below:

Table 2.1: The service quality model
Service quality aspects Illustrations
Reliability Reliability is the field where the service provider can perform their activities accurately. This quality is very crucial for the customers who are using the banking services in order to depend on their services.
Responsiveness This means the organization’s willingness to help the customers. This thing has very important role when the customers have special requests, questions, complaints and problems they are facing during the services.
Assurance Assurance means the company’s understanding and courtesy about the service ability to insist confidence in the customers mind. It also safeguards for the customers in getting health, financial and legal services.
Empathy Empathy means how careful organizations are about on the customers at an individual level. Clients of service providers in all level of an organization have a certain requirement that required personalized attention.
Tangibles The tangibles of an overhaul firm consist of the appearance of the physical facilities, equipment, employees and communication materials.
Source: Adapted from Parasuraman et al. (1988:23) and Mudie & Cottam (1999:86)

The organizations need to understand and managed throughout the service firm. Organization need to address four different areas within them to be considered to address the quality of services (Mudie & Cottam, 1999). The service quality aspect needs to be considered in order to address the quality of services from the organization. The area to be concern at initially is the service encounter that reflects the interaction between the organization and the customers. Secondly, the concerning area would be service design or the system that helped the customers to obtain their required services. Thirdly, the productivity of an organization that draw the bridge of relationship between the quantity and the quality of services produced concerning the resources would be used and finally the culture of the service firm and its organizational structure. There are two service quality models would be presented and evaluated for the purpose of this research namely Gronross service quality model and Parasuraman Zeithami-Berry service quality model.

Gronross service quality: Gronroos introduce this model in 1984 that concept of the term service quality. The prime notion of this model is quality should be service oriented where the considerable element would be client orientation. In further illustration of this model Gronroos has explained that service quality is dependent on two variables, namely the client expected service and their actual perception regarding the service they are getting from the organization. This service model expressed that, the clients expectations of a service could positively influenced by the promises made by the business aspects through traditional four P’s marketing mixture. Other considerable influential expected services are tradition, oral communication and prior experience with the service providing organization. The model illustrate that a positive perception of quality can be drawn in both technical and functional dimensions of the service. Technical quality includes the services that the clients are receiving for instance how the banking institution is managing bank accounts. Where, functional quality focuses on how the client are receiving a service for instance the professionalism and customer relationship management policies of the banking institution.

The Parasuraman-Zeithaml-Berry service quality model: Parasurman and his colleagues proposed this model in 1985 which is based on three basic principles:

  • Nature of service: It means and includes the intangibility of the services that restrict the use of tangible aspects of the customer that may help them to feel they are getting quality service.
  • The relative perception on the fact of comparison between expectation before getting the service and actual getting services.
  • Finally, the method of getting services and actual service deliberation.

CRM in service quality in banking

According to Zu (2002) CRM system has able to successfully identifying the customer demands and separating each customer demands with another. Therefore, with this system customers are getting more quality services and have enjoyed a better level of cooperation. It also earns more customer loyalty and turn into an organization to become more customer oriented business policies.

Significance of service quality

The quality services can be developed for future stable economic growth of the country. In the interest of making the stable financial condition in a state the role of quality banking service is crucial. In overall improvement of the gross Development Product of a state it is very useful contributory sector. The role of service quality can be illustrates by evaluating the manipulating of service quality on multiple aspects of a firm. This aspect includes profitability, potential employee growth and market share. There have several studies that proved this notion that the profitability of a financial institution increases when firm can effectively provide quality service to their customers.  According to Anderson, Fowell & Lehmann (1994) the quality service has positive co-relation in terms of influencing the profitability of the total assets of the firm. High employee turnover in an organization leads to decrease the quality of service. Higher employee turnover rate can lead to dissatisfy the customers as well. For instance, if the customer needs to wait in long queues before being served obviously they will felt irritating and thus leads them to be dissatisfied.

Customer relationship management is the integration of the customer focus business strategy which makes a close relationship with sales and marketing in any business sector. In the modern business world it has been using as the key instrument to optimizing profitability, revenue and customer satisfaction by identifying potential customer group and market segmentation. With the help of technology CRM help an organization to look better insight, higher level of customer involvement, more effective interaction and integration of multiple customer channels. According to Bergeron (2001) CRM provide the integral method of communication that enable an organization to manage all customers’ accounts. From these customers the organization derived future directions in order to achieve some key objectives like as: building better relationship with the organization; to identify and serve better customer needs and; overall growth of the organization.

Over the last few decades, customer relationship with the business become the crucial factor in evaluating overall service quality of that organization. Rust & Oliver (1994) states that service quality in a financial organization is depends on some sort of issues like as employee contact skills including the way of approaching to their customers, attitudes of helpfulness and service quality. Parasuraman et al. (1998) found that relationship between service quality and interpersonal skill are highly liable to make a relationship stronger and quality services. Service quality is an abstract concept and is likely to be influenced by many variables (Rust & Oliver, 1994:77). The perceptions of clients on the service quality of a service firm might be influenced by the degree of CRM of the service firm. The main notion of customer relationship management is treating the customers on an individual basis and driving force should be concentrate to that particular customer needs that may later on works to radical improvement of the quality of service providing industries.  In the same way, the phenomenon of quality banking service is not particular part of the world but generally required in everywhere of the world. Therefore, studying the implementation of CRM in banking sector in United Kingdom seems would be more fruitful in answering the critical questions survival in the fields of study. Thus a way, this research problem would come to investigation.

Moreover, with the changing behaviour of the customers in creating competitive advantage for an organization would be retaining customer with the business as long time as possible. It can be hold in making advantage for the organization. If the bank want to enjoy this benefit than they should enjoy create loyal customer groups which can be brought through great customer relationship management. Relationship development is usually developed through long term time period. In order to do this, organization should take series of work that would be focusing the customer’s interest. Customers would only be satisfied and retain in the business when they would be feel the sense of created value feelings. Therefore, delivering value created service is become a concerning issues for the financial institution. In addition to it, literature identified some areas of where there are more fact finding issues could be done. It can be summarized as like: bank employees might not be accurate perception regarding service quality; some of the banking branch could not realize and identified client’s need and some of the customer might be disappointed with the service they are getting at this moment. Banks play an important role in estimating the quantity of the financial products and banking service role on national economy.


This chapter has given us detail illustration on the concepts of customer relationship management in terms of quality perspective. The definition of the CRM, importance and benefits of CRM has been highlighted and discussed in this chapter. Due to the unique characteristics of the financial institution service and their CRM system role in quality banking service, it is very crucial to realize the term service quality and service quality dimension. Moreover, it is very clear from the fact that Superior CRM could positively increase a firm’s level of service quality. These issues will lead to construct the framework of conducting this research.

Chapter 3: Research Methodology


This chapter will illustrate the research layout that was taken during conducting this research. The overall research task for instance research philosophy, type of research, adopted data collection method, sample size determination, data analysis techniques would be discussed under this chapter. The research philosophy subscribed the way in which the research paradigm will be conceived and utilized. The purpose of this chapter are : discussing the author’s research philosophy in relation to other philosophies; expounding the research strategies; adopted research methodologies validation and introducing the research instruments that the researcher been adopted and utilized in pursuing research goals and objectives. According to Cresswell (2007) stated that the illustrating the research approach is essential in order to increase the validity and reliability of the research.

Overview of research design

The research design is highly intellectual task and successful research task is depending on it. In fact, research objective and the research field determine how research design would be. The research design addresses the key research objectives. Research methodology is a set of structured set of guidelines or activities to assist in generating valid and reliable research results (Mingers, 2001, p.242). There have many research philosophies available in existing world and these are illustrated in diagram below which was adopted by Saunders, Lewis & Thornhill (2003) named as research process onion. This research process onion illustrates research design in stage by stage. The author of this research has followed this research design and subsequently illustrates it in different circles.

Research philosophy:

Research philosophy illustrates the way in which data about the investigation should be gathered and analyzed. There are two major research philosophies have been developed in the era of research. The research philosophies are namely positivist which is also called as scientific and interpretive which is also termed as anti-positivist (Galliers, 1991).

1. Positivism:

According to Levin (1998) positivists observed and described phenomena from the objective viewpoint without interfering the facts under the investigation. The observer here believes that the phenomena should be isolated from the observation from any kind of biasness. Therefore, it is generally said that positivism involves manipulation of reality with variations in only a single independent variable. Under this paradigm the prediction can be made on the basis of previously observed phenomena. Positivism has historically rich backgrounds that enrich the tradition. The fact is that the positivism is constructed from our society that dismissed as a scientific and therefore invalid.

2. Interpretivism:

Interpretive research is considered as the most significant research methods used by many researchers as it have multiple uses to find out the actual facts form reality. Interpretive research works on different assumptions to describe the actual production of meanings and understanding in real context. Interpretive studies also put assumptions via the meaning that the people hold insight their mind. Under this research techniques dependent and independent variables are generally not defined (Denzin & Lincoln, 2003). Interpretive research comes through an interactive process which involves studying the social behaviours in social settings where the researcher tries to interpret the phenomena relating to some sort of beliefs, experiences and assumptions. In fact, it reflects the reality and shared meaning of its interest.

3. Rationality of adopted research philosophy:

In order to conduct this research an interpretive philosophy was followed. As the studies main objective is to find out the role of customer relationship management in providing quality service in the banking system the data will be collected from the customer’s perception about the service they are getting from the Halifax bank is relatively human behaviour related. Thus, researcher thought this philosophy would be best suited for this study. In supporting to this philosophy Crotty (2007) states that Interpretivism is conceived in such a reaction to the effort that can develop a natural science of the social. Its foil is largely logical and methodology can bid to applied human enquiry. The justification of this research philosophy was done by Denscombe (2002) who states that social reality is something that constructed and interpreted by the people rather than something that exists objectively out of there.

Research approaches:

The type of research design was adopted by the Saunders et al. (2003) according to him,  there have mainly two research approaches in that been used in conducting any research. These are inductive and deductive approaches. Both approaches are explained below:

1. Deductive approach:

Deductive approach is called a testing a theory where the researcher usually develop a theory or hypothesis and design a research strategy to test the formulated theory.  According to Marshall (1997) deductive research is the techniques are those techniques where knowledge develops in more matured fields of enquiry. It is required to engage a sort of logical leap. The main characteristics of deductive approach is, it explain the causal relationship between each and multiple variable. It also has a great influence in controlling for testing hypothesis. Deductive approach offers great independence of the researcher. In this process, concepts are operational zed for quantitative measurement and generalized (Saunder et al, 2009).

2. Inductive approach:

Inductive research approach is that one where the researcher begins new line of enquiry in order to reach a decision in any particular subject is called inductive approach. Saunders et al (2003) noted that the inductive approach provide an opportunity to have more explanation on what is going on. Inductive theory starts with a vague concept then uses specific forms of observations of empirical evidence, on the basis of this, you generalise and build theories.  This research was a deductive approach as it tries to examine the existing facts regarding customer relationship management system used by modern business firms. As the qualitative research methods have a close involvement with the researcher this allows them to find issues that are really positivistic enquiries. This descriptions can played a strong role in suggesting possible relationships, causes and more dynamic process.  The major limitation of this study is research method is because of the subjective nature of the qualitative data and its origin in a single pattern.


Qualitative research is the depth studies of facts and most intensive studies. It is quit hard and more stressful and more time consuming. According to Delamont (1992) the qualitative research is only suitable for those people who take research work seriously and have a strong commitment for the work. In case of qualitative research, events can be realized and get involved only if the contexts are seen. Here, the contexts of investigation are not manipulated only they are natural; nothing is predefined for granted. In this kind of studies, the researcher want those who are used to studied to speak for themselves and where the researcher attend to the experience as a whole. “The goal of qualitative research is the development of concepts which help us to understand social phenomena in natural (rather than experimental) settings, giving due emphasis to the meanings, experiences, and views of all the participants (Pope & Mays, 1995)’’. As it has given more realistic information about any fact therefore, this research method was adopted in this study.

Quantitative: Quantitative research make up of those studies where the data will be analyzed in the form of numbers. This type of research is founded more closely on its original plans. Quantitative research concerning with the collection large volume of data. This research approach is trying to identify why something happens, what is liable for certain events. The mechanism of controlling under the investigation is absolutely essential to this cause of an effect.

Research strategies:

The research strategies were survey and interview. Surveys enable the researcher to get the data about different situations or views at one point in time through questionnaire and interview. Quantitative analytical techniques usually used to make an inference from the gathered data from the existing relationship. Survey method usually helped to cover large population sample and possible experiment more variables within shortest period of time. Triangulation means using the different data collection methods within single study or investigation in order to bring the factual things in front of the audience (Wisker, 2011). It also helped to identify and deployed the method which confirmed the use of primary data that is supplied from the field investigation.

Survey research is one of the most popular measurement techniques in marketing studies and also similarly popular in the field of business and social science. This technique includes the procedure of asking a number of questions in order to find the facts. There have three main characteristic of survey i.e. survey is used to illustrate the specific aspects of population; the estimated representations are generally derived from the target population and finally quantitative measure of that data (Kramer, 1991). The most important advantage of this method is although the researcher sought the information from a part of population but this system works such a way that it can be generalize as it is studied on whole population. Another advantage of this method is it is very easy to record and it facilitates advanced statistical analysis. The major disadvantage of using these methods are: it can be abused if questionnaire could not be constructing in precisely, and response rate seen in low. Again, it can’t bring depth data from the respondents. Furthermore, survey research methods can be classified into three categories such as: person administrated, telephone administered and self-administered. Person administered survey has great influence in getting higher rate of response, quality response and great adaptability. Therefore, in order to conduct this research the researcher administered survey was done through a well structured questionnaire. Through the survey method quantitative data from the customer of Halifax bank were asked to meet this research objective.

Interviews method of data collection usually used to gather qualitative information from the respondents. According to Kvale (1996) through the interview method it is generally seeks to cover both a factual and meaningful level. Again, interviews are particularly useful for getting the story behind a participant’s experiences. The interviewer can pursue in-depth information around the topic. Interviews may be useful as follow-up to certain respondents to questionnaires, e.g., to further investigate their responses (McNamara, 1999). Interviews are actually a form of personal research where the researcher works directly with the respondent in order to gather depth information concerning the subject of study. Here, it should be noted that the interviewer is considered as the prime role player if the interviewer if well trained and could be more subjective than this method could bring more intense information. The prime advantage of using this method is in the personal interview the interviewer can ask follow up questions in order to follow the right sequence of opinions. The main disadvantage of using this method is it is time consuming and it is more resource intensive. In this research, the information regarding the Halifax Bank customer relationship management system was been asked through a personal interview from the customer relationship manger.

Time horizon:

The Gannt chart about the research plan in details is provided at the appendix section. This study was conducted through a single survey and an interview. Considering the fact analyzing the issues around the study found the similarities with cross sectional study.

1. Cross sectional studies:

In cross sectional studies time frame is the essential concern. A cross sectional study is a type of observational study where the investigator has no control over the exposure of interest. This study involves identifying a defined population at a particular point of time. It measures a range of variables on an individual sample basis. It measures the outcome of interest at the same time.

2. Longitudinal studies:

Longitudinal study is the kind of studies where the data are collected over the period of time. It can be classified on the basis of information that would be tested. Another way longitudinal study can be described as the study where information regarding any fact is collected repeatedly from over the period of time.  Moreover, this kind of research is usually related to seek the answer of mainly two kinds of research problem. The first kind which is deals with the contemporary changing occasions in different variables and secondly comparison of these change with different group of individuals.  This was a cross sectional study that has been done through a single survey and interview of few staff of author’s chosen organization.

Data collection methods:

Questionnaire method was used as a method of data collection under this study. The well structured questionnaire were set out in order to collect information from the respondent’s concerning their view regarding the role of customer care relationship management in providing quality service by the bank. Questionnaire works like a vehicle to bring the information to the researcher. According to Cohen (2011) questionnaire is a set of questions designed to produce the statistical information from the respondents in order to accomplish research objectives. It allows the researcher to collect the relevant information necessary to address the management decision regarding any key issues.

In order to conduct a successful research it is essential to make a good questionnaire first. According McIntre(1999) during constructing the questionnaires the researcher should consider the following issues:

  • Are the questions are meeting the research objectives?
  • Are the questions depicted with the attitudes and behaviours with the subject of study?
  • Do the respondents get clear idea or necessary information about the subject of investigation?
  • Do respondents understand and interpret the question correctly?
  • Will respondents provide the required information’s?

The format of the questionnaire was combination of both open ended and close ended.  The questionnaire which was used to collect information from the customer through survey was close ended and interview questions were open ended. The main advantages of inclusion of close ended questions are: It is very easy to understand; it requires less effort on the part of interviewer and respondent; easy of tabulation; it’s less time consuming; interviewer get lees scope to be biased and finally the gathered answers are directly comparable from respondent to respondent.

The key advantages of open ended questions are: it helps to gather wide range of responses and information; answers are based on respondent’s frame of thinking therefore the researcher have no scope to influence respondent regarding his thinking about a particular facts. The main disadvantage of this technique is it is very difficult to code the information in order to analyze and presentation in front of the audience.

Data types:

There are mainly two types of data i.e primary data and secondary data.

1. Primary data:

Primary data are those data which are collected from the field for the purpose of addressing the subject of study.  This data are those data which usually has never been collected before. The primary data for this study was collected from the Halifax Bank customers and Halifax Bank staffs.

2. Secondary data:

Secondary data are those data that have already been collected for purposes other than the problem at hand.  These data can be collected quickly with lower expense. The secondary data helped the researcher to identifying the problem and better understand the subject under the investigation. It also helps in developing and formulating the research problem and giving the answers the certain research questions. For this study the secondary data were collected from the journal, magazines, books, online library, company’s website, online business magazines etc. In fact, this was studied in order to the beneficiary for interpreting primary data more insightfully.

Study population and sampling

 Sampling is the technique of choosing a respondent from a population. Sample size determination and specification of margins of estimated error is vital in survey (Cochran, 1977). The study population is customer of Halifax bank in greater London area. The information was also sought from the employees of Halifax bank in the interest of collecting data regarding customer relationship management system. There were 80 sample were selected through convenience sampling. Systematic random sampling was used in order to represent different geographic location of Greater London.

1. Sample selection for this study:

Sample list were not available to the researcher therefore non-probability sampling were used in order to collect data from the customers. Therefore, data from the customers of Halifax bank were collected through convenience sampling. At the same way, interview from the Halifax officers were collected the same way as convenience sampling where researcher had to relay on the respondents who gave their kind consent and time to provide information regarding their customer relationship management tools and techniques. As we have seen from the table that the convenience sampling have greater flexibility for the researcher to collect data within shortest period of time. Actually, due to time constrains more scientific approach were avoided.

Data processing and analysis

Data analysis includes the interpreting the field observation to the audience in systematic way (Zikmund, 2003, p: 73). It starts from the coding data to present to the audience. Close ended questions which were collected from the field and reflects the customer view regarding service quality of Halifax bank will be analyzed quantitatively. The field data which gathered from the Halifax staffs will analyzed quantitatively. The field data will try to analyze in accordance to the objectives of the study. The field data will be processed through SPSS (Statistical Package for Social Sciences). Percentage, cross tabulation and other applicable statistical tools will be use to analyze collected data. According to Leary (2004, p. 37), the logical reason for conducting a research is being proved through a good analysis of data. Statistical analyses are conducted to better for the experimental changeability in the behavioural data. Therefore, the function of statistics is to sum up and answers the questions about the behavioural differences that have been obtained in the research. This statistical analysis involves both descriptive and inferential statistics.

1. Descriptive Statistics:

Descriptive statistics are applicable where the illustrations are required in many ways to illustrate the qualitative facts founded from the investigation. It could also be used in quantitative form of data as well. The descriptive statistics for illustrating this study findings were frequency, percentage table that represents information’s on key variables of the study. The general information regarding customer relationship management to measure the quality service in the Halifax bank was illustrated through descriptive statistics.

2. Inferential Statistics:

In order to critical analysis the variables concerning the customer relationship management and quality of service of Halifax the inferential statistics were used. In order to assist analyzing the answers of the questions more like central interest of the study although the majority findings of the study is descriptive but still there have some issues which were needed to be illustrates inferentially is discussed here.

Rational of choosing research methodology

Before start talking about the logical reason behind overall adopted research methodologies let’s have a look on adopted research methodologies in this study:

Table 3.3: Adopted research methodology

Research philosophy Interpretivism
Research approaches Deductive
Research Paradigm Both qualitative and quantitative
Research Strategy Survey & Interview
Time horizon Cross sectional
Method of data collection Questionnaire
Data types Sources of data Primary: Halifax bank customer & staff

Secondary: Books, journal, library, publication, newspaper etc.Sample selection & sample sizeConvenience sampling method

Sample size: 80 customers, 3 staffs

Interpretive research philosophy was taken as it provide the researcher to analysis human behaviour in better way as the research objective is related to find out customer perception regarding  quality of banking services. Deductive research approach was used to examine the current theories and proposition existed on the contemporary world. A survey research strategy was adopted in order to collect data from the customer as it can bring us huge information relatively within shortest period of time. The interview method also used to bring more depth information under the subject of study. Convenience sampling method was used in this research because it easy to get information using this method.

Ethical approach to the research

Typically ethical issues are very important in conducting any research. It also termed as moral issues or obligation in research which need to be followed by the researcher. This starts and includes the proper respects of individual responses to acknowledgement of the other’s work using in that research.  This ethical issue are differs and become different to each other in terms of the adopted methodology by the researcher (Eileen Barker, 1984). The primary objective of following ethical issues in research is to protect individual works and safeguard them to be abused due to adverse consequences from research activities (Cooper & Schidler, 2001:112)

During conducting research, the following ethical issues were considered:

  • Try to follow full professionalism during collecting information from the primary sources of data.
  • The information collected from the responded will only be used research purpose only.
  • Privacy of data and dignity of the respondents considered during asking information.
  • Respondents were allowed enough time to respond their views regarding research topic.
  • Researcher tried to avoid the biasness any feel free to keep himself outside of the views.
  • Proper acknowledgement to the sources of the data used for the purpose of this research.


This chapter gives details about the outline of the research methodology adopted for this study. The process of choosing methodology were sequentially illustrates under this chapter. The logical reason behind conducting this research was furthermore illustrates under this chapter. The audience will get detail information regarding adopted methods from this chapter.

Chapter 4: Findings of the study


This chapter will illustrate the research findings concerning the study of investigation titled as role of customer relationship management on service quality in the United Kingdom banking sectors. The chapter specially illustrated the major research objectives sequentially. The findings will be discussed in two parts where the first part will try to illustrate the findings of the survey derived from survey on Halifax bank customer regarding their views on role of customer relationship management in providing quality banking services. Under the first part the particularly the information which was collected from the customer will try to investigate and analyze the first, third and fourth research objectives. Part two which based on the illustration according to the information derived from interview with the Halifax staffs meets second research objectives. In first part majority of data are quantitative where as in second part is through analysis of qualitative data. The result of field observation are illustrates here through different statistical tools. The Statistical Package for Social Science software were used to analyze the major findings.

Respondents demographics

It can be seen that majority of the customers under this study was male 61.25% whereas female percentage was 38.75%. Another important thing this table showed that most of the Halifax bank customers are university graduate 40%. Other considerable amount was found as like secondary level education 27.50%, primary 12.50%and post graduate 8.75% respectively.

Role of CRM on service quality

This is the first research objective. By answering the following answers the researcher will try to explain the fundamental customer view’s on those factor that affects quality of banking service in Halifax bank.

On-time bank statement

Table 4.2: Role of sending on time bank statement to the customers in quality customer service:

Receiving bank statement on time does affect your banking quality services

Level of measurement



Strongly disagree






Neither agree nor disagree






Strongly agree






From the study it has been revealed that most of the respondents believe that the on time bank statement to the customers does affect the quality of banking services. From the above table it can be seen that majority of the customers 37.70 % are strongly agreed with this statement whereas, 30.76% customers agreed with this issues. The other proportion which constitutes disagree 16.25%, neither agree nor disagree and strongly disagree 2.5% are very minor group of people who oppose with this view or do not consider it as a customer relationship management tools. Here, attitudes consist of behavioural approach of the employer of the Halifax bank towards clients or customers.

Employee efficiency customer service:

In order to assess the role of relationship between efficient banking services in providing quality banking service the customers replied their view as followed. It can be seen that majority of the customers of Halifax bank strongly agreed (46.25%) that relationship between them and bank is highly dependable on efficient banking service. Other significant proportion in this respective are agree (30.76%), disagree (16.25%), strongly disagree and neither agree nor disagree 2.5% respectively.

Adequate customer information sharing

In responding the questions whether the information sharing with the client regarding the banking products and services most of the customer expresses different views. Most of them 34% customers don’t think it is essential to keep update the customers about their products. Again 25% percent customers viewed that they are agree with the statement where as other significant percentage can be seen as strongly agreed 20 percent are. It seems quite mixed types of views that don’t draw a particular significant conclusion regarding the issues.

Value for the money

The role of the treating the value for the money is one of the essential criteria for evaluating the quality of service of the bank through customer relationship management that has been revealed from the study. From the above stated figure it can reveal that, significant number of the customers considered that providing best value for the money is essential in providing quality banking services for the customers that constitutes 61% percent of the total respondents. The next considerable percentage can be seen 22.5% who are agreed with views of role of providing service relative with the money.

The role of promised excellent services with promised times and regular interaction in quality banking services:

It can be seen that the most of the customer agree with the role of customer relationship management tool that strong commitment and regular interaction with the customers from the bank is required to provide the quality customer relationship service in this financial institution.

Role of employee’s effective communications with the customers:

The communication is the key in the field of relationship marketing. It is the vital instrument to exchange views and ideas of both parties and it can bring happiness for both parties. It can be revealed that most of the customer acknowledged the role of effective communications in providing excellent customer service. The proportion of this is 45% are agreed with this view where 30 % of them are strongly support this. The other considerable customer thought 12.5% are neither agreed with this view nor disagreed and 7.5% expressed disagreed with this view.

Role of extensive knowledge on products and services of the employees are essential in providing quality services:

It can be seen that the role of extensive product knowledge is has both two dimensional affect in quality banking service. Most interesting figure has revealed from this study is that equal number of respondents  27.5% people are strongly agreed and disagreed who are thought that there have a strong role of having extensive knowledge about the products of the employees working in the bank in providing quality customer service .

Role of using technology and e-banking services helps to develop the quality of the services in this industry

It can be seen that 52.5% customers strongly believe that using technology and e-banking service is crucially important instrument that been used in customer relationship market in order to enhance the quality of the services in this industry. The next closest proportion which is constitutes 27.5% customers are agreed with the view of role of technology in providing quality banking service. In fact, technology is the key instrument in modern CRM system that allows the bank in keeping touch with their customers and get everyone knows about their activities, and future policies, changes and possible actions in overcoming any complex situations. From the customer point of view, they want more easy banking services and better relationship the service organization like bank. Therefore, most of them considered it as the most important CRM tools in modern banking system.

Role of the availability of the senior manager in order to discuss the issues required to bring attention to them is required to increase the service quality of the bank:

It can be seen that, the availability for the senior officer in the banking branch to listen the customer problem play a vital role in serving quality banking service. The almost half of the respondents 46.25% customers agreed with this view, 26.25% customer were strongly agreed with this view. The other significant amount was accounted as 11.25% neither agreed nor disagreed with this view. Only 13.75% disagreed with this view.

CRM tools and techniques in Halifax bank

This information was gathered through a structured interview with the customer relationship manager of three different branch of Halifax bank located in greater London. The interview was conducted in order to get the right information regarding how the system of customer relationship management works for Halifax bank. This was the second key objectives of this research. The following result will helped to give an explanation about that research objective. From the interview with the customer relationship manager of Halifax bank on how their system works in keeping relationship with the customers. It has been revealed from the study that company keep it workable in their system by understanding customer. Customer relationship tools and strategies are set out according the knowledge assessing customer account key information. Company used their own database to file customer information and transform information into meaningful and systematic way. Bank usually; categorize their customers in different need based categories by analyzing their needs and account information. Bank uses keep regular communication with their service, any change new products etc by using their Information technology system. In order to do this bank follows the following steps:

  • Identifying potential customer for further business by using a customer database to identifying wrong and right customer for their business.
  • Identifying valued customers.
  • Profitable customer segmentation.
  • Loyal customer group separation.

In an answering the other major useable tools in bank CRM system all of them are expressed almost same view that, technology is the most important key in maintaining customer relationship management.  They also mentioned the role of SAS software which is company currently used in all over the United Kingdom in assessing customer values and offering any further investment. The other  key form of CRM process are working with the help of sending regular mail, sending bank statement to the client’s address, regular advertisement, inside the bank consultation, telephone banking facilities, on time feedback, need based banking service offer are the most useable tools by Halifax bank in keeping their CRM system workable with their customers.

In overall they are feel higher level of satisfaction with their level of customer satisfaction, CRM system compared with their competitors and quality banking service. Yet, in replying the possible course of action for improving the better customer relationship management most they mentioned that company should trained their staffs to make them more interactive and customer focused behaviour, develop their brand image, keep holding regular bonus and award scheme for their loyal customers and keep trying to continuous development of the technology based customer service system.

CRM tools contributing in loyalty and retention

This was the third research objective that examines the role of customer relationship management in customer retention and loyalty. The customer of Halifax bank was asked some questions in this purpose which are resulted as below:

1. Existing CRM system in fulfilling customer demand:

It can be seen that most of the customer are disagreed 36.25% with the existing customer relationship management system. The other contributing factors are agree 21.25%, strongly agree 18.75%, strongly disagree 15.00% respectively. In fact, majority customers think that existing customer relationship management system could not able to fulfil their demands and expectation quality service from the bank. Although, a good number of customers are remain happy with the service they are getting through current CRM system of the Halifax bank.

2. Retaining with the business:

The customer were asked whether they will be with their existing bank after consider the all factors in answering this questions iit has been revealed that 40% of the customer says they have very likely possibility to stay with Halifax bank in their future banking needs. On the other hand, 21.25% customers say they might stay with the bank and 15% customer said they wouldn’t say with the bank as they are not happy with bank’s customer relations him management system and overall quality of the banking service.

Recommendation for improvement

This was the fourth and final objective of the study intending to get possible course of actions from the customer point of view in improving quality banking service through well equipped banking service. The study was found that most of the customers were recommending that the bank should explain their product policies, terms and condition in detail as much as possible before sale their products. The relationship with the customer should be trust based CRM policies were recommended from them. Customer relationship can positively improve the customer get better guarantee of securing their funds. The strong commitment of the employees towards the customers, strong ethical standard of behaviour, the rational communication flow and welcome greeting or approached at the branch can improve CRM strategy and overall banking services. The policies were recommended by the customer that if the employees get better working environment inside the bank then they will positively motivate to provide better customer service and behave well with the customer. Physical appearance of the bank and the financial accountability and financial performance to the customer are required to enhance the overall quality of the banking service of the Halifax bank. The showing attitudes are actually a reflection of the customer relationship management commitment of the bank which is required to improve overall quality of the service.


This chapter provide the major study findings from the field investigation based on customers view and in a statistical way. The further illustration based on this finding will be discussed on next chapter. This chapter is if fact the result of after having spending a very hardship. This result will have application on both ways like from the customer perspective and management perspective as well.

Chapter 5: Discussions on Research Findings


This chapter has vital importance to draw a valid conclusions and recommendations, which has discussed later as chapter 6: Conclusions and Recommendations. Under this chapter, the researcher has to critically analyse and evaluate the researcher findings obtained from the review of literature and primary findings. Based on the discussions of the research findings, the author may able to analyse and evaluate the appropriateness of the research project both from academic and organizational point of view. The researcher has reviewed some of the most relevant and appropriate secondary and tertiary sources, such as academic books, articles, journals, publications and other related sources. The researcher has collected primary data through conducting semi-structured interview and questionnaire survey within the case studied bank, i.e. Halifax Bank, UK at the selected branch in the city of London, United Kingdom.  So, the researcher would like to say that in this chapter, he has covered all of the relevant issues and concerns on the discussion of the research findings in accordance with the role of CRM on service quality in the banking sector, a case study of Halifax Bank, UK.

Secondary research findings

The researcher would like to summarize the findings from the review of literature as follows-

CRM is one the most widely used techniques in an organization, mainly service-based organization in any country. The key focus on the CRM is to provide most relevant and appropriate services by the organization to be achieve competitiveness in the market as well as to meet the demands and expectations of the customers and other relevant stakeholders.

CRM is a new concept that has been using modern technologies. For example, Gratner (2008) has mentioned that CRM is considered as one the most appropriate and relevant business strategy that has been using information technologies that leads to the future prosperity and profitability of the business. He has also mentioned that CRM has been using by an organization, like a financial institution to forecast different factors leading to customer satisfaction as well as developing and implementing a customer-centric process within the organization.

In UK, most of the service-based organizations, like Halifax Bank, have been providing better banking services through developing and implementing different tools and techniques of customer relationship management (Rust and Oliver, 1991). They have suggested that CRM is an important approach to explore and analyse current demands and expectations of the customers and thus develop policies and practices to meet those demands and expectations for the purpose of achieving organizational goals and objectives.

Based on the review of literature, the author would like to opine that CRM is becoming an appropriate approach to create most competitive business environment either internal or external or both business environment. For example, Teare et al. (1990) have mentioned that CRM has considering as one the most strong tools and techniques to create effective business environment in relation to evaluate its management styles and business operations within current competitive business industry. So, it can be noted that CRM has vital influence on creating a competitive business environment by an organization in respect to provide quality services to the customers compare to other competitors in the market.

In an organization, like financial institution (e.g. Halifax Bank, UK) can introduce CRM practices to create more customer-based and customer-centred services through improving the quality of the services. According to Swartz and Lacobuchi (2003), CRM on service quality in financial institution has key significance in the field of attracting new customers, meeting demands and needs of the existing customers, encouraging customers to be loyal to the organization, reducing number of complaints from the customers and thus finally developing strong relations with the customers.

To create an interaction with the customers, CRM can be used as a building and most appropriate framework through the identification of current trends within the relevant market and thus analysing the key factors influencing customers to make purchase decisions towards an organization (Baker, 2003). He has stated that CRM is provided benefits to both the organization and the customers through creating an interactive relation by the organization with the customers. So, it can be noted that CRM on service quality has been playing crucial roles to create an interactive communication and relations with the customers by the organization for the purpose of meeting demands and expectations of the customers as well as to achieve organizational goals and objectives.

To gain business success and to survive in the competitive business market, an organization can use CRM on service quality as effective instrument. For instance, Buttle (2004) has mentioned that a financial institution can use CRM as effective and appropriate instrument to explore the nature of the market competition and thus to develop business strategies in relation to survive as well as gaining success within the market.

To address the key issues and concerns involved in the service quality, an organization may adopt and implement CRM technique. As an example, Ling and Yen (2011) have noted that CRM is one the most appropriate techniques to introduce the key issues involved in the customer service provided by an organization. In similar views, Payne et al. (2001) have mentioned that through the use of CRM an organization is able to encounter different issues associated with the customer services and thus help the organization to introduce most standard policies and practices to ensure quality services to the customers in an organization, like financial intuition.

Primary research findings

The researcher has collected primary data from the case studied organization, i.e. Halifax Bank, UK through using two most common and appropriate research methods, such as semi-structured interview and questionnaire survey. The researcher would like to mention following key points derived from the primary research findings-

Based on the survey results, it can be noted that majority of the customers are male (e.g. 61% of the respondents) who have been getting banking and financial services from the case studied bank, i.e. Halifax Bank, UK with the implementation of customer relationship management tool and technique by the organization. The demographic characteristics of the respondents also show that all of them have knowledge and understanding about the CRM practices of the case studied bank. So, it can be said that CRM is one of the most well-known and important approaches in relation to receive quality services from an organization, like Halifax Bank, UK.

In accordance with primary research findings, the author would like to opine that CRM has been considering as one the most relevant and appropriate to explore and analyse several factors involved in service quality of a financial institution, like Halifax Bank, UK. For example, more than half of the respondents (e.g. 38% of the respondents are strongly agreed and 31% of the respondents are agreed) have agreed and strongly agreed that CRM is an important technique to provide better banking services in terms of providing bank statement to the customers on time. Another example shows that majority, such as 48% of the respondents have strongly agreed and 30% of the respondents are agreed that CRM technique can be use by an organization to ensure efficient customer services and thus build strong relationship between the organization and the customers.

Based on the primary research findings, the author would like to say that information exchange and information share has crucial influence on the quality services by a financial institution to the customers. As an example, the author would like noted that 37% of the respondents have provided their opinion that CRM is most relevant and appropriate technique to ensure effective information exchange and information share by the bank, i.e. Halifax Bank, UK with the customers and thus create most interactive communication system to build strong relationship with the customers.

The commitment towards providing quality services to the customers by a financial institution, like Halifax Bank, UK is becoming very important aspect and concern to ensure success and survival of the business in the current competitive business environment. For example, in accordance with the primary research findings, it is clear that majority of the respondents have agreed and strongly agreed that the commitment towards quality services to the customers by the development and implementation of CRM.

The use of modern information technologies, such as e-banking systems have been considering as one of the new concept and approach to deliver quality services to the customers. The CRM tool has been considering as key driver for the purpose of providing quality services by the Halifax Bank, UK to ensure modern uses of information technologies, like e-banking system and thus develop strong relationships with the customers that have been proved from the primary research findings.

The primary findings reveals that CRM tool and technique in relation to identify and analyse some of the major factors and aspects involved in service quality- creating most standard customer database, exploring values of the customers, identifying key customer segmentation, and developing policies and practices to identity loyal customers of the organization and other related aspects. Thus, it can be noted that CRM has been regard as one of the most standard and relevant tools and techniques to explore actual and potential customers as well as their demands and expectations towards to the organization. Customer satisfaction, customer loyalty and customer retention etc. have considering as key aspects in service quality of an organization, like Halifax Bank, UK. The primary research findings proved that in relation to increase customer satisfaction, customer loyalty and thus ensure customer retention, Halifax Bank, UK has to improve its CRM practices and thus achieve both goals and objectives of the organization as well as of the customers.

Based on the primary research findings, the researcher would like to say that majority of the respondents have mentioned that they have intention to stay with the Halifax Bank, UK because of its current policies and practices to implement CRM to meet the demands and expectations of the customers. For example, 55% of the respondents have mentioned that the current approach of CRM at Halifax Bank, UK is appropriate to meet their demands and expectations and thus they have stated that they want to stay with the organization. CRM is regard as vital tool for an organization to explore and analyse overall aspects of the service quality provided by the organization, like Halifax, Bank, UK. The primary research findings show that majority of the respondents both of semi-structured interview and questionnaire survey have opined that CRM is one the most relevant and appropriate tools and techniques to ensure standard quality in services provided by Halifax Bank, UK and thus achieve competitiveness in the financial market within the UK.

The primary research findings represent that more than half of the respondents, such as 36% of the respondents are disagreed and 15% of the respondents are strongly disagreed with the current CRM practices at the Halifax Bank, UK. On the other hand, rest of the respondents have mentioned that the current CRM practices at Halifax Bank, UK is appropriate to meet the demands and expectations of the customers. Thus, based on the primary research findings, the author would like to opine that Halifax Bank, UK should develop and improve its current CRM for the purpose of exploring and analysing current trends in the financial market in the UK as well as to identify and analyse the demands and expectations of the customers.    At the end, the researcher would like to say that CRM has been becoming an important tool and technique to meet the demands and expectations of the customers in relation to achieve goals and objectives both from the customers and the organizational point of view.


The researcher would like to say that CRM is becoming an important approach to create completive edge by an organization, like Halifax Bank, UK. Under this chapter, the researcher has discussed and explained most of the relevant and important data and information in relation to the role of customer relationship management on service quality in the banking sector, a case study of Halifax Bank, UK.

Chapter 6: Conclusions and Recommendations


This chapter is constructing on the basis of major study findings on role of relationship marketing in United Kingdom banking sector. On the basis of that the researcher would like to propose some recommendation that might be helpful in developing the quality of banking service for the Halifax bank in the United Kingdom. It has been revealed that the role of relationship marketing in providing better banking service in modern world is crucial. But the current system is still not enough to satisfy large number of the customers. Therefore, the continuous development in this field is now become the demand of time. The first thing in this field is some of the customers and both the staffs are still not clear in understanding the essence of relationship marketing and its role in better banking service. Apart from that, also the filing information data base and use them in relevant sectors are not been using in scientific way. Again, this new emerging concept is sometime hampered by lack of proper communication between customers and organization sometime. In addition to it, poor controlling mechanism in Halifax bank makes it more difficult to measure the actual improvement in quality of their service.

Again, lack of vast application to the all level of customer to relationship marketing the organization itself keeps them in hanging situations. Thus, they could not able to attract more potential customers as they are expecting. Therefore, bank needs to re-engineer the business process and business process needs to facilitate to introduce customer relationship marketing with the more potential customers. The quality would generally enhance when this system will start work properly. The starting point in this approach is the identification of the relevant market (Guiltinan & Paul, 1991) that the company is serving and the partitioning of the market into groups of customers with similar needs and/or characteristics who are likely to exhibit similar purchase behaviour (Weinstein, 1994). So, the quality also concern effective market segmentation as well. With the identification of current gap in providing quality banking service, this research also provide guidance to the policy makers concerning further improvement of customer relationship management system in considering the fact of improved banking service. Therefore, this research would be a positive reflection of the role of relationship marketing in the modern banking system.


Based on the research findings the researcher would like to recommend following areas of improvement that will lead them to offer better banking service for the customer:

Improvements of the value for the customer money: During making any strategies the superior officer of Halifax bank should introduce such a system in the process of customer relationship market that might be able to feel better sense of satisfaction by the customer in getting quality service by rewarding and regular forwarding product information and promotions. 

Improvement of the employees’ attitudes: When customer comes at the branch to get the service from the bank they should positively treated by the employee and they should listen customer’s any complain or their needs carefully.

System and software development: The Halifax should introduce and invent more money to develop software as the company is currently using SAS technologies in assessing credit risk management of the customers and business intelligence software to the organization in regular exchanging information with the customers. Currently in banking sector more sophisticated CRM software has been invented and Halifax bank should start using this.

Capability development: The capacity development here means and includes the development of human resources and organizational setting development to handle vast economic market. In the interest of development the overall quality of the banking service the capacity development would give more fruitful results. This factor includes the development of working conditions of staff and supportive instruments in assuring quality service.

Information technology development: Information sharing system with the customer should be developed in such a way that the organization can share their any sort of information with the customer without taking any help from the media or advertisement. In the interest of achieving service quality and initial acceptance of the customers the Halifax require to structured technology based better customer relationship management system that satisfies the customer demands.

Marketing planning development: By realizing the essence of relationship marketing the organization should have taken more strategic plan for development the quality of the banking service. When organization will feel the necessity of developing the relationship marketing then the service quality of that organization will automatically developed. The most important factor a customer consider during choosing banking organization. During choosing banking service provider bank customers rely heavily upon the reputation of that particular bank. In this respect, customers usually consider the factor of competitor orientation and brand image.

Trust development: At present days, customers are more assertive and more conscious than ever before. They want to take service from those organizations that they can rely on. Therefore they always justify benchmarking and rendering the services to the existing market. So, dimension of reliability of the services is crucial that makes able them to perform the promised service to their customers.

Human resource development: Human capital is the blood provider in an organization. The willingness to help the potential customers and providing expected service techniques should be taught them through different techniques. Human resource of Halifax bank should make able to foster to nurturing customers in better way. The top management should make to be able to handle any conflict arisen to them in case of complex and sensitive situations.

Moreover, the customer relationship management should not stop keep contacting with the customer service consumer it should also be extended to taking their views after sale has been done. In fact, an understanding of the impact of the post sale services is also important to service quality. Overall, this study would hopefully positively contributed to the body of academic knowledge and will be helpful to offer more service offering and to the building of customer relationships.

Limitations of the study

There have some limitations the researcher felt during conducting this research. Most important difficulty the researcher has faced is getting an appointment in order to conduct interview with Halifax bank staff. Again, due to the time constrains more interview could not make possible which could be more informative. Moreover, the representation of the customers were also not that much. In spite of having an opportunity to follow more scientific approach only due to time constrain researcher had to use convenience sampling method which may give an unrepresentative results. There are many application of customer relationship management and it is widely applicable in businesses. But this study is particularly focus on the application of this relationship marketing in only development of the quality of banking service. Lack of professional skill of the researcher the data could not be able to analyze with more statistical tools. The analysis of the relationship between each variable and with multiple variables could not be able to adopt in this research due to time restriction.

Reflection of research objectives

This research was conducted to fulfil the following research objectives firstly, to find out the role of customer relationship management factors on service quality of the banking institutions. Here, the study has revealed that customer viewed that the quality of banking service in Halifax bank has largely dependable on customer relationship management instruments. Secondly, to identify the tools of customer relationship management used by the Halifax bank where study founded that bank is currently using different information based software and customer database in managing relationship with their customers. Thirdly, this research aimed to investigate the influence of customer relationship management in creating customer loyalty and retention. While studying this issue under the investigation major findings was revealed Halifax bank have currently a good level of satisfied customers who are promised to take banking service from them in near future. Fourthly, this research tries to propose scientific methods of customer relationship management techniques in order to improve the quality of customer service. During answering this question most of the customer prescribe some actions to improve overall quality of customer relationship management and quality banking service as well. The required area of improvement were identified as like as to invent more sophisticated technology based software that support to improve overall CRM system in the Halifax bank.

Future research opportunities

Hopefully this study would positively contribute to development of the quality of banking services and make the financial institutions as more profitable customers. Some dimensions of banking industries have identified that need to be minimized were identified in this research which could be a field of future research. The dimensions of customer relationship management in financial service industries have expand through this research. Another important thing direction of this research is it will lead to conduct future research in the role of the relationship marketing underpinnings and overall quality of other financial service firm and creation of customer loyalty. By using this research future research in future banking sector can plan to conduct more research and strategies for consuming large customer group.


In order to meet the contemporary business needs and bring a stable quality service in financial in firms the role of customer relationship management is vital. With the development of the technology the demand of the customer has changed therefore new strategy should customer expectoration oriented that would be helpful in serving efficient and effective customer service and thus the customer would retained in the business. Customer relationship management have strong power to make more qualitative banking service in financial market industries. In that sense it can be said that, relationship market is an instrument of ensuring accountability in the banking sector.  The organization’s policy should address some critical issues which play a vital role in customer relationship management and service quality. The clear knowledge and awareness of customer relations factors which is very vital in service quality should realize by the bank managers and bank employees would be helpful in rapid growth of the quality of the products and services.

Recent search terms:

CustomerRelationshipManagement(CRM)ofHalifaxBank|DissertationWritingSamples|2Write | customer loyalty and customer satisfaction strategic mangement for hospitality chapter two |