The issue faced by the company
It can be observed that the Westpac Bank is one of the highest-ranking commercial banks in Australia. The Westpac bank mainly performs various account-related banking activities and examines the transactional behaviors of Australian citizens. The main reason for the customer retention-related issues by the Westpac Bank of Australia is the immense pressure from the investors that are shifting the focus of the banking authority from serving the customers to fulfill the demands of the investors. Therefore, this has made the customers lose their hope and reliability in the banking services as they are switching to another bank.
To make the banking services more recognized among banking customers, Westpac, Australia required to develop customer retention policies within the organization (Brown, 2018). However, due to a lack of personal touch and interactions with the customers the customer retention issue with Westpac bank has been emerged more drastically. Lack of enhanced customer service has also made the customers move on to other service providers that make the overall profitability and customer base of the company weak and imperfect. It can be assessed that a loyal customer is much more beneficial than new customers as their reliance upon the company can help to increase the business and profitability of the company. In the case of the Westpac Bank of Australia, due to lack of customer retention, the overall business opportunities for the organization are minimizing and the profitability is reducing as well.
As Westpac fails to serve its customers and mitigate their issues with the banking services, their reliability and preferences towards the services of Westpac have been shifted. Apart from that, if the organization fails to develop customer retention the customer relation may get hampered as well. On the other hand, the minimum customer acknowledgment from the branch supervisors has been minimized due to which the customer’s loyalty has also been decreased. Due to this Westpac, Australia may end up losing its competitive position from the market (Baber, 2019). As customers are the most essential external stakeholders for the banking organization, losing their interest in the baking services may create several obligations to maintain the existence and competitive position in the financial industry.
The assistance of the system thinking approach to make optimal decisions against the issue
The system thinking approach can be defined as an integrated approach that is based on the beliefs of acting differently based on various customer services and business plans. However, system thinking is also essential to address complex issues along with their probable solutions.
Moreover, in respect of the rationale of the system thinking approach in can be identified that through utilising this approach the Westpac bank can initiate a holistic approach so that all the consequences can be significantly dealt. Apart from that, a system thinking approach is also essential as it involves the assessment of customer data from different perspectives. Therefore, based on this the system thinking approach can also assist in making optimal organizational decisions so that customer retention-related issues can be faced and articulated in a significant manner (Thaichon et al. 2017).
Moreover, for improving the customer relation Westpac’s banking and customer relation authority can offer several relevant prompts and significant advances to the banking officials so that the financial needs of the customer can be fulfilled within a timely manner. On the basis of this, the system thinks approach can allow the management to incorporate a systematic and organized way to mitigate the obstacles due to customer retention issues (Martín et al. 2020).
It can be recommended that personal interactions with the customer is required to be increased so that their issues can be critically analyzed and relevant solutions can be developed. Moreover, the team management can also create a big picture of the current position of the bank to visually analyze the condition and give a significant response against the identified issue. To improve the customer experiences, Westpac should introduce a hassle-free digital platform so that customers can state their issues directly to the banking officials through the mobile application.
Baber, H. (2019). FinTech, Crowdfunding and Customer Retention in Islamic Banks. Vision, 0972262919869765.
Brown, S. S. (2018). The role of the United Nations Global Compact in helping to drive corporate social responsibility-related practices in the Australian banking sector (Doctoral dissertation).
Martín, E. G., Giordano, R., Pagano, A., van der Keur, P., & Costa, M. M. (2020). Using a system thinking approach to assess the contribution of nature-based solutions to sustainable development goals. Science of The Total Environment, 139693.
Thaichon, P., Quach, S., Bavalur, A. S., & Nair, M. (2017). Managing customer switching behavior in the banking industry. Services Marketing Quarterly, 38(3), 142-154.