EVALUATION OF STAFF ATTITUDINAL CHANGE TOWARDS

CUSTOMER BANKER RELATIONSHIP IN A PERIOD OF

POLITICAL TRANSESSION:

(CASE STUDY OF FIRST BANK BAUCHI BRANCH)

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Keyword: Staff Attitude, Customer Banker Relationship and Transession.

Introduction

The Nigerian banking industry is at the threshold of change as to

completely alter the fabric of business and indeed lives, this change being

rooted in the competitive nature of the industry which incidentally is expected

to intensify as new players of local and Global scope permeate the market and

as the competitive terrain becomes more challenging to navigate due to the

ever-changing customers’ expectations and preferences , the challenges being

churned up in the operating environment, and expectations of the regulatory

bodies, competitors In the industry will indeed need to adopt new technologies

redesign processes and excellently manage their manpower in order to secure a

competitive advantage.

Banking industry is an important sector in the business world which has a

growing impact on all other sectors of the economy because of financial

services provisions. In this volatile situation financial institutions were not left

out as they are seriously affected by the level of competition both locally and

internationally. The banking industry environment today is highly volatile;

Nigerian banks therefore needs to develop effective technique to enhance the

interaction of customers and the bank staff. The complexity in the banking

industry has made bank managers to focus on how to create close affiliation

with their customers. No wonder Nigeria banks now create a separate

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department in the bank known as customers care unit to address customer issues

and complaint in order to ensure that customers get value for their money

thereby enhancing customer loyalty, building and maintaining customer’s

cordial relationship in order to achieve an advantage that can lead to customer

retention and increase profitability.

Furthermore, loyal customers can provide the foundation for growth

which leads to competitiveness in the industry. Also, the belief that relationship

marketing (RM) investment builds stronger, more trusting customers

relationship (Morgan and Hunt 1994) and improves financial performance

(Schroder and Lacobulli 2001) has led to massive spending on customer

relationship programme. Sheth (2005) also opines that customer relationship

marketing would result into customers’ retention which has to do with creating

relationship, Customers loyalty which has to do with developing relationship,

and customer interaction may lead to customer retention.

Background to the Study

The complexity of today’s business environment has imposed continually

changing settings in which organizations compete for survival. As a result,

special emphasis may be placed on acquiring and retaining quality employees as

this could serve as a key factor underpinning organizational success. The

concept of organizational change could be a situation where company or

organization is going through a transformation. Organization change occurs

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when business strategies or major sections of an organization are altered which

is known as reorganization, restructuring and turnaround. It is also about

reviewing and modifying management structure and business processes where

small businesses must adapt to survive against bigger competitors and grow.

The market condition and business environment of the 21st century is

witnessing rapid change and the banking sector is becoming increasingly

competitive around the world. Business often must respond to this rapidly

changing environment. Environmental change has been a business focus for

decades. Now, a well-established new comer is changing the traditional

business environment even more: information technology; the internet and the

electronic commerce are the new players disrupting the business environment.

Even more critical is the development of entirely new business (Ogbadu&

Usman, 2012). Given these changes, businesses have rediscovered that, more

than ever, in the face of increased competition, matured market, and ever

demanding customers, treating existing customers well is the best source of

profitability and sustained growth (Hair etal, 2006).

Today, companies have realized that customers are the life blood of the

business; business survival is largely depended on the customers. The

realization of this fact has made it possible for companies to have a better

chance to outperform competition. Customers are therefore, better satisfied

through a competitive superior product and services beyond their expectation.

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Satisfying the customer eventually graduate into a relationship where the

company sees the customer as part of the business and business decision making

by continuously seeking customers opinion. According to Kotler and Keller

(2006:139) as cited by Ogbadu& Usman (2012), marketers must connect with

customers, informing, engaging, and may be even energizing them in the

process.

Onut etal, (2007) saw CRM as a business strategy to identify the banks

most profitable customers and prospects, and devotes time and attention to

expanding account relationships with those customers through individualized

marketing, reprising, Discretionary decision making, and customized service all

delivered through the various sales channels that the bank uses. Nigerian banks

are often making efforts to satisfying big premium services. While small saver

with low balances are considered unprofitable, and are left to get cold. Accounts

average balance, account activity, service usage, branch visits and other

variables are being used to assess profitable and non-profitable customers

(Ogbadu& Usman, 2012).

Having realized the importance of customer relationship management,

and it spotential to help acquiring new customer, retain existing ones and

maximize their lifetime value, Onut etal (2007) suggest that, IT and marketing

should have a proper coordination to provide a long term retention and selection

of customers. Ojiri (2016) observed that the growth in the number and variety of

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financial institution as well as the financial instrument and operative during this

period attest to the grave relevance of the sector in the National Economy

Development. The structural readjustment in the financial sector which

commenced in 1986 was directed towards enhancing the Banks efficiency

through increased competition, strengthened thesupervisory role of the

Regulatory authorities and streamlined public sector relationship with the

financial sector. Thus, since the early ‘90s’, the phenomenal growth of the

Banking industry in Nigeria following the Deregulation of the industry has

generated interest and enthusiasm amongst top notch stakeholders and

institutions in the industry stressing the urgent need for strategic decisions.

Significantly in the year 2002, the central Bank of Nigeria dismantled the

divide between commercial and investment banking a culmination of a process

commenced 7 years earlier with the Government’s approval of the conversion

of themerchant to commercial Banks. Thus, Banks with a view of survival can

no longer rely on their “efficient personal” solely but must synchronize

personnel capabilities with appropriate systems and structures in order to wade

the storm of competition, survive the tide of changing emerging technology,

shifting several old economy business practices towards organizing by

customers segments rather than by-products, focusing on customers lifetime

value, instead of transactions alone, focusing on stakeholders and not through

advertising alone, focusing on customer acquisition, retention and satisfaction.

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 Considering the above arguments, Olawale, Folarin&Yusuph (014)

argued that Nigeria banks now adopt relationship marketing principles and

design strategies to achieve and maintain close and long lasting relationship

with the customers. This study is therefore aimed to examine the effect of

customer relationship management on the performance of Nigerian Commercial

Banks.

At present there could be various types of organizational changes, this among

others may includes the most difficult situations relating to reorganization,

downsizing, innovation and improvement of product quality. Specifically,

looking at the economic crisis faced by industries in Nigeria, change need to be

immediate and fast. For instance, within the Nigerian banking industry, there

may be increased global competition, outsourcing, and fast changing new

technologies resulting in massive confusion and challenges for those involved in

such a volatile environment. It is imperative that any type of change embarked

upon by any organization should be able to move the organization a step ahead

of the competition.

Companies need to look for ways to do things more efficiently and cost

effectively. There is no need to fear change. Instead, small businesses should

embrace change as a way to lay the foundations for enduring success. As much

as organizatios are realizing the dire need for change, individuals involved in

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working together to implement change are one of the major challenges faced by

change agents in trying to implement any type of change.

Change agents need to understand why employees are not changing their

behaviour in the desired ways. In the process of change, employees are

worried that change will take away their power and status and they argue that

change is associated with tiresome processes of breaking old habits and learning

new skills, hence they are generally not interested in the change. Resistance to

change is the number one reason for failures of organizational change initiatives

and it is a common problem. Executives could identify low-level managers’

resistance as the most important barrier to corporate restructuring or improved

performance. The major question the top managers today may answer is

whether this resistance is a symptom of a deeper problem in the change process,

or it is a result of negative attitude towards change itself. As much as change is

perceived inevitable; it could lead to a state of chaos, low job security,

additional workloads and guilt for the management team responsible for

implementing the changes. This may result in consistent and strong negative

attitudes towards change caused by fear, cynicism and ambiguity. Some forms

of change may lead to emotional exhaustion among managers resulting in their

failure to give as much support and care to clients as planned.

Statement of the Problem

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Organizational leaders appear to be facing increasing pressure to implement

change initiatives to respond effectively to growing competition and fluid

operational environments. Organizations seem to be in a turbulent state as a

result of changes in the markets, competition, and globalization, widespread

technological advancement which lead to quicker, flexible and cheaper ways of

doing work. This seems to leave the future of employees in a very uncertain

state. No company today is in a particularly stable environment; even the

Banking industry seems to have witnessed and will continue to experience

turbulent change. If organizational change is inevitable for the industry today

and to ensure that they move in a positive direction, manager’s attitudes towards

organizational change need to be understood and potential impediments to

change should be identified.

Objectives of the Study

The General objective of this study is to determine the attitude of managers

towards organizational change in the Nigerian Banking industry. The specific

objectives are:

i. To determine how managers commitment enhance organizational change.

ii. To examine the relationship between communication of change process and

managers’ attitude towards organizational change.

iii. To find out whether managers past experience affects their attitude towards

organizational change.

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iv. To review the relationship between reward and managers attitude towards

organizational change.

v. To ascertain the relationship between managers’ participation and their

attitude toward organizational change.

Significance of the Study

Customers’ relationship management is an important business approach

because it can enhance a company’s ability to achieve the ultimate goals of

retaining profitable customers and gain a competitive advantage over its

competitors. In principle, customers’ relationship management focuses on

building long-term and sustainable customers’ relationship that add value for

both customers and the company. It is regarded as a process of computerizing a

staff’s knowledge about his or her customers because customers’ relation staff

would normally need to remember their client’s requirements, behaviours, tastes

and preferences in a usual business process

This research work will examine ways of improving and enhancing

customer relationship management in Nigeria Banking sector. Customers are

viewed as an important element in organizational performance and productivity

of Banks. When the relationship with customers is poorly managed. This can

lead to competitive advantage for the bank. This study is important for

customers, employees, banks, academia and even government. Customers will

have access to better and qualitative services from the banks. Employees can

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also have improved conditions of services due to better organizational

performance. Banks can gain in terms of superior performances. This research

can also benefit the academia in terms of adding to knowledge.

Scope of the Study

This study covers the attitudes of managers towards organizational change in

first bank Bauchi state Banking industry with focus on technology. These Bank

was selected because the researcher can easily get information needed for her

research due to proximity to the researcher. The study is limited to Bauchi state.

In every organization there exists various levels of managers, such as Junior,

middle, and Senior. However, this study covers the three level managers. The

population element employed for this study was limited to Managers of the

Bank. The adopted indicators for this study include commitment,

communication, past experience, reward and employees’ participation. It was

presumed that the indicators would make for easy measurement of attitudes of

managers to organizational change in the Bauchi state First Bank.

Definition of Terms

Attitudes: Certain regularities of an individual's feelings, thoughts and

predispositions to act toward some aspect of his environment. They reflect a

person’s tendency to feel, think or behave in a positive or negative manner

towards an object.

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Communication: The act of sending and receiving information from one

person to another.

Managers: This refers to managers who head specific departments or serve as

project managers responsible for implementing the company policies and plans.

Organizational change- It is transformational process where a company moves

from the known to the unknown.

Organizational Commitment: This is the relative strength of an individual's

identification and involvement in an organization.

Past Experience: Event and activities that have happened to the employees that

influence the way they think and behave in the organization.

Reward: Reward is the combination of financial and non-financial benefits

given to employees in exchange for their efforts.

Historical background of first bank

When Nigeria’s foremost bank, FirstBank of Nigeria Plc rolled out drums to

celebrate top performers among its over 37, 000 firstmonie banking agents, the

reasons were obvious. In the first instance, the bank succeeded in proving that it

remains the first name behind the quest to implement financial inclusion in the

banking world as well as explain that the gap between the tech savvy and the

low literacy clients has been breached. This is because the firstmonie agent

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network represents the convenient and comfortable alternative for customers

that are acquainted with sophisticated digital channels.

Another reason stem from the fact that it has succeeded in looking into the

future to create that ecosystem that allows easy financial transaction wherever a

customer is in Nigeria.

At the event, First Bank compensated 37 leading agents with N15, 250, 000.00

as follows; the sum of N250, 000 to 31 agents at the state level; N1, 000, 000 to

five agents at the regional level and a whopping N2, 500, 000 to the grand prize

winner at the National level. Zayyanu Hassan Ishaq from Abuja emerged the

grand prize winner.

FirstBank’s Firstmonie service is providing financial/banking solutions to rural

and semi-urban locations across the country. Through this channel, the Bank is

providing convenient services that endears trust and provides ease of access to

banking products, irrespective of location, literacy levels, familiarity with

technology and accessibility to modern infrastructural facilities.

The firstmonie initiative of First Bank is borne out of the fact that 38 per cent of

the adult population in the country is financially excluded. Of this number,

according to EFINA 2018 Survey, 41.1 percent are male while 55.9 percent are

female. There was need therefore, to get all hands on deck to bring about

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financial inclusiveness among all and sundry, invariably fostering economic

development.

Trancing the origin of firstmonie, the Deputy Managing Director, First Bank of

Nigeria Plc, Mr. Francis Gbenga Shobo stated that “It actually started in 2009

when it was just a concept in the bank. We have branches all over nigeria; we

are one of the most spread branches in the country. But we felt that there was

still an opening out there. It was in 2010 that we launched the firstmomie

programme.”

Lending credence, the Group Executive eBusiness and Retail Products, Mr.

Chuma Ezirim, confirmed that steps were taken between 2014 and 2017 to give

the programme the top of spot status it enjoys today.

“In 2014, we took a decision to change the scheme from wallet base to account

base. It took us another two years to test the concept and officially started the

pilot in 2017,” Ezirim revealed.

It is worthy of note that the first monie initiative had undergone several

operating structure changes and value proposition. In December 2017, the bank

ran its pilot test with over 400, 000 transactions processed. The success of the

first run necessitated its re-launching in 2018.With a key motive of ‘planting

community heroes nationwide’, First Bank has not only succeeded in

developing the small and medium scale enterprise sector, but has created

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independent finance experts and men and women who can hold their own

financially.

Giving further details, Managing Director/Chief Executive Officer, First Bank

of Nigeria Plc. Dr. Adesola Adeduntan, described how it is First Bank’s

proactive stance to leverage on gaps in the society to provide long lasting

solutions beneficial to citizens towards financial inclusion, addressing poverty,

hunger, unemployment and reducing crime.

He said: “The key part of our history and our future is about development and

economic growth, and the key strength of our franchise is our ability to look at

gaps in the society, develop products and services that address that gap. So as an

integral part of our strategy, we believe that by significantly working with the

Central Bank, we can improve the financial inclusion index of the country. We

would, as FirstBank, be assisting this country to address poverty, hunger…

thereby also promoting security of life and property because when people are

gainfully employed, the implication is that they think less of crime.

He noted that First Bank’s intention with firstmonie is to try as much as possible

to make agents the ‘centre of the financial ecosystem in the country’.

Across the length and breath of the nation, tidings of great joy are the order of

the day following the presence of FirstBank’s firstmonie agents, even in the

remotest parts of existence. The scheme has eased the stress of trading and has

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raised financially independent entrepreneurs as well as thoroughbred employers

of labour.

In Aiyetoro, a riverine community in Ilaje, Ondo State, where there are no

banks, but FirstBank has positively impacted it. A firstmonie agent, Stephen

Adeleye, confided that;

“People can easily walk in without having to travel and that has developed a

savings habit because we have easy access to the bank and can deposit their

money easily,” he said.

Testifying to the positive impact of the scheme, a beneficiary, Tina Farodoye,

revealed that “The transaction has really helped my business to grow. I buy my

things in bulk and do a transfer from here. And the things I buy from Lagos

gives me more gains because they are expensive here.

“Again, Agent Emphraim Osinachi from Obohie, Asa Ukwa West of Abia State

explained that people of all ages have embraced the scheme because of its

positives, saying that customers are better given attention by the agents as

against what is obtainable at the ATMs.

“We serve all ages, from adults to minor. Unlike the ATM machine where there

is no assistance, the people feel relaxed here. Sometime ago, armed robbers

invaded a house and were able to get only N50 from a home after ransacking

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the house while the owners were away. The reason is because of the firstmonie

agent banking in place now.”

He maintained firstmonie is a veritable option to enforcing the Federal

Government policy on cashless economy.

Aliu Adeleye spoke from Lekki-Aja in Lagos, and excitedly narrated how

people have come to support and patronise the scheme, stressing that business

improved when he added ‘mobile banking transaction using our firstmonie

platform’.

“This place is heavily buzzing with transactions, especially in the evenings

when the banking halls are already closed. Presently we have about six other

locations because of the demands, and they are all doing well,” an elated

Adeleye said.

Surajudeen Adebisi Bada from Abeokuta, Ogun State stated that “we open by

8am but people are already lined up by 7am, and there over two hundred

customers trying to transfer money and over a thousand trying to collect money.

If I look at our data base, I am convinced that we can beat some of the banks.”

Noting the importance of Firstmonie agents, Shobo emphasized that they are the

ones the customers go to, to open accounts, take deposits, make payments, sell

airtime and all the rest, adding that ‘they are the most critical part of that

ecosystem’. He further lauded the CBN for its regulatory role and enablement

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and the Bill and Melinda Gates Foundation for their contributions and oversight

functions.

“The regulators are very important, and we must give it to the CBN and its

governor, Godwin Emefiele; they have done a lot of changes in regulation that

have allowed the programme to scale as much as it has, today. A very, very

important partner of ours has been the Bill and Melinda Gates Foundation; they

helped us with grants, advice, and insight of what they had in other countries.

We’ve used all that in coming up with the testimonies with which we are

running now.”

Today, we have 36, 000 agents, with each having about one or two persons

assisting them. We have opened more than 500, 000 accounts, processed more

than two trillion transactions through the firstmonie agency, indirect

employment in excess of 100, 000 people working across the entire value chain.

More than 8, 000 women have been fully empowered servicing different

customers, and they can begin to improve for themselves,” he said.

Sustaining the avalanche of positive feedbacks, Kehinde Kudirat Kasali from

Ogun State, confessed that ‘FirstBank has been able to help me a lot. This is so

that I can stand on my own. I can hold my own anywhere I am, and I appreciate

Firstmonie.”

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In the words of Uchechi Amogu from Obowo in Imo State, ‘There’s really been

a great change in my life. I can tell you that in this very location, sometimes we

do up to 200 transactions each day. I was working alone, but now I have

employed two other persons.”

From Warri, Delta State, Orode Hesse, said that “Firstmonie has really impacted

me; it has empowered me financially, and I have been able to employ six staff;

five female and one male. I see firstmonie as a business to employ and empower

women.”

Abubakar Aki Bolaji from Abuja puts it this way ‘the nearest bank here is about

15 kilometres away. We have cut the cost of transportation, and we have about

350 footprints here on a daily basis’ exposing a massive influx of customers

each passing day.

Conquering harsh terrains and topography, the firstmonie agent banking scheme

has reach the nook and crannies of Northern Nigeria and made impacts indelible

to neglect.

“We have built up a significant number of firstmonie agents in the Northern

parts of the country. A top government officer from Jigawa State told me of a

couple of agents at somewhere in Gumel. This is about 70 kilometres to the

nearest bank-town. Along the 70 kilometres, he said he saw two agent locations.

That’s a testimony of our presence in the North.

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“We are not stopping. It’s going to be a marathon; we believe there’s a lot to be

done, not just in Nigeria. We also have other locations across Africa. Ghana is

of interest to us, and we have started rolling our agency banking in Ghana. The

Democratic Republic of Congo, a country of about 80 million people, is also a

significant opportunity for us to help Africa, to promote financial inclusion and

begin to address poverty across the continent,” Adeduntan said.

The assessment of Mohammed Tatari from Bauchi state seems to summarise the

unquantifiable advantage of firstmonie.

He said: “We are thankful for this bank that has come closer to us. Before this

time, people travel far just to enjoy banking services, but now firstmonie has

brought banking close to them. This firstmonie service is helping people in

many ways, as a result, we are experiencing large numbers of people here.”

“Before firstmonie, goods have to be loaded into vehicles and will not be

delivered until money has exchanged hands. But now, we just transfer the

money to the supplier and the goods will be delivered without question so this

has really changed our lives.”

While the tradition among people is that banks have about 600 locations,

FirstBank has 37, 000 locations, and they are present in 99 per cent of the 774

local government areas of the Federation, and there’s no one close to the record.

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The beauty of the opportunity is that it is being used to impact positively on the

society.

The Head, Marketing and Communication, FirstBank Nigeria Plc, Mrs. Folake

Ani-Mumuney, was full of praises and encouragement for the Firstmonie

agents, urging them to continue in their giant strides while encouraging others

to follow suit to further raise the banner of financial reach and inclusion, and the

Nigerian economy.

“This is about your future and the growth of your locality and the country in

general. Continue to thrive and win, and do not rest on your laurels,” she

admonished.

“The unwavering efforts and remarkable contributions by our Firstmonie

Agents at promoting financial inclusion in Nigeria is indeed very much

appreciated. We remain committed to doing more, strengthening business

activities, driving economic growth and development; thereby reducing

poverty,” the CEO, Adeduntan concluded.

CONCEPT OF ORGANIZATIONAL CHANGE

According to Werner (2007), organizational change refers to a transformational

process where a company moves from the known to the unknown. A number of

factors, in the modern business scenario, have necessitated this transformational

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process. Mcshane & VonGlinow (2008) noted such factors including

globalization, technological change, increasing government regulations,

Organizations aim to increase responsiveness to clients, as well as productivity

and efficiency through employee involvement and participation, they also aim

to develop flexible organizational and management strategies that will enable

the organization to anticipate and adapt to environmental changes and finally to

survive.

MANIFESTATION OF ORGANIZATIONAL CHANGE

With respect to Nigeria situation, Larwood (1995) noted that the study of

organizational change is one area of investigation in which cognition research

has been interested, among such areas as decision making and environmental

sense making. The intersect of researching how change phenomena are

construed and managed , with how they are measured is a crucial issue in our

quest for understanding how managers reason and behave in changing work

conditions. Polley (1997) indicated that, this issue has become even more

critical with the continuing dramatic transformations work organizations have

been experiencing as a result of structural, process and technological changes

and advances. The extent to which machines replace human energy, dexterity,

diligence, judgment and evaluation of the manufacturing process is of great

importance.

UNPLANNED VERSUS PLANNED CHANGE

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According to Cummings and Worley (1997), unplanned change usually occurs

because of a major sudden surprise to the organization which causes its

members to respond in a highly reactive and disorganized fashion. This type of

change occurs when a significant figure suddenly leaves the organization

resulting in public relations problems, poor product performance, loss of

customers, and other disruptive situations.

LEADERSHIP IN ORGANIZATIONAL CHANGE

Successful organizational change depends on leaders - managers and bosses

who have direct authority with people going through the change - to support and

execute change in the span of influence effective leaders acknowledge that their

support is crucial to success and commit to doing their part. The following are

some of the roles leaders may play as they drive change in their organizations.

1. Sponsor leaders act as advocates for the change at their level in the

organization. They are representatives who keep the change in front of their

peers, the “higher – ups”. A sponsor is the person who will not let the change

initiative die from lack of attention and is willing to use their political capital to

make the change happen. As sponsor, the leader is the champion.

2. Role model leaders of change must be willing to go first. They demonstrate

the behaviour and attitudes that are expected to everyone else. Employees watch

leaders for consistency between words and actions to see if they should believe

the change is really going to happen.

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3. Leaders are self-aware and deliberate. Make decisions as managers, leaders

usually control resources such as people, budgets and equipment, and thus have

the authority to make decision that affect the initiative. They have the ability to

say “yes” or “no” to the project moving forward within the span of their control.

During change, leaders must leverage their decision – making authority and

choose the options that will support the initiative. Leaders are decisive set

priorities that support change.

4. Communicate leaders are the face and the voice of change. They

communicate often to share information, keep people updated and offer

encouragement. When employees hear multiple messages in the organization,

the one they listen to the most is their immediate boss. Leaders interpret the

change message to be relevant for their reports, while still matching the overall

message. Leaders are transparent and consistent.

5. Engage leaders provide the motivation to change and get people involved.

They create a sense of urgency and importance about the change, and show

commitment and passion about getting things done. They offer recognition to

those who are participating and doing well. Leaders realize that change can be

difficult, and understand the need for people to be motivated to step out of their

comfort zone. The leaders are energetic and empathetic.

6. Hold accountable with their authority, leaders hold people in the organization

accountable for the change. They uphold agreements and make sure others do

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the same. They do not get away with not changing and work to understand the

underlying reasons so they can remove obstacles. Leaders follow through on

delivering consequences when people do not do their part. Leaders are exacting

and fair. Effective leaders recognize that change cannot happen unless they

fulfill the roles that only those in authority can. Enlist their support and clarify

the roles you need them to fill in their areas and in different situations.

Managers’ help leaders in their organization see the importance of the unique

part they play in change, and help them fulfill it.

FIERCE COMPETITION

The number one thing that can prevent you from getting ahead in a fierce

market does not know what to expect from your competitors. The last thing you

want is to be surprised by a competitor – it could cost your business customers

and revenue. That’s why it’s crucial to stay on top of everything they are doing.

Competing in a cutthroat industry is not just about getting ahead. You can not

just develop an advantage – you have to maintain it too. When you know what

is going on with competitors, you can react to new trends, find new ways to out

– compete, and stay to ahead of the competition. This in how you build a lasting

competitive advantage that keeps your business growing.

How to do it:

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1. Follow industry news. Subscribe for updates from your industry’s top

publishers, attend new product announcements, stay up to date on regulatory

changes – be as informed as possible about what is going on in your market

2. Anticipate their next move. Put yourself in your competitor’s shoes. What

would you do if someone stole market share away from your business? How

would you counter the move you have about to make?

DEVELOPMENTAL CHANGE

According to Mcshane and VonGlinow (2008), most of the changes within the

Banking industry focused on developmental change such as improving

performance in a small skill , method , performance standard or condition that

for some reasons do not measure up to current or future needs. The key focus is

to strengthen or correct what already exists in the organization, thus ensuring

improved performance. The process of development keeps people vibrant,

growing and stretching through the challenge of attaining new performance

levels by focusing on continuous improvement initiatives. Usually when this

type of change occurs, no major business processes are introduced or replaced

(Werner, 2007). The culture, values and mindset of the organization remain

unchanged in this respect. Such type of change brings with it very limited stress

and frustrations.

TRANSFORMATIONAL AND TRANSITIONAL CHANGE

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Nair (2009) pointed out that, the aluminum industry also embarks on

transitional change which involves moving from a current way of operating to a

new way of operating like a reorganization or creation of new services or

products. It may require the dismantling of a current way of operating and

replacing it with another. Rather than simply improve what is there, transitional

change begins when leaders recognize that a problem exists or that an

opportunity is not being pursued and that something in the existing operation

needs to change or be created to better serve current and future demands.

COMMON FORMS OF CHANGE WITHIN THE NIGERIAN BANKING

INDUSTRY

There are dramatic transformations experienced as a result of structural, process

and technological changes and advances within the Banking industry (Taylor &

Cooper, 2000). These changes include the following:

ORGANIZATIONAL RESTRUCTURING (RE-ORGANIZATION)

Organizational restructuring as a means of change has become a popular

concept for organizations in recent years. Many organizations are currently

engaged in change initiatives though their experiences are mixed.

Organizational restructuring seem to have become a way of life and a feature of

many organizations in the industrial world (Ryan & Macky, 1998).

INNOVATIVE CHANGE

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According to Wood (1998), organizational innovation has been consistently

defined as the adoption of an idea or behavior that is new to the organization.

The innovation can either be a new product, a new service, a new technology or

a new administrative practice. It takes into account the differential

implementation of radical innovations, most typically advanced manufacturing

technologies and new ways of doing work.

TECHNOLOGICAL CHANGE

Technological change is also one of the common changes that occur within the

Banking industry which has had a huge impact on employees and management.

Kent and Williams (2001) noted that, technology has become an ever increasing

presence in the workplace and it is one of the major topics within the business

world. More and more organizations large and small are trying to incorporate

the latest technology in their operations and the Banking industry is not an

exception. Campbell (2000) defines technology as tools and machines that are

used to solve real world problems that pose a threat to organizations.

TOTAL QUALITY MANAGEMENT

Total Quality Management (TQM) is one of the forms of change occurring

within the Banking industry. According to Duffin (1995) TQM imply such

issues as leadership, zero defects, continuous improvement, mistake-prevention,

process and team work. It emphasizes that each step of the production process is

seen as a relationship between a customer and a supplier (whether internal or

28
external to the organization). Suppliers have to meet customers’ agreed

requirements, formal and informal, at lowest cost, first time every time.

Schalkwyk (1998) suggest that the main purpose of TQM is to continually

improve organizational processes, resulting in high quality products or services.

It is a corporate-wide process and has to involve all levels of employees. In

short, TQM is best suited to helping with the design of organizational processes

so that quality products or services can be provided. TQM also focuses on

cultural change, concerning the commitment of employees to the idea of quality

and teamwork, which is seen as difficult to achieve (Schalkwyk, 1998). Possible

features of incompatible cultures may include value and norms oriented towards

short-term production and quick fixes, discrete activities and pursuing

departmental goals, and fundamentally the traditional individualism-based

organizational culture.

EMPLOYEES ATTITUDES TOWARDS ORGANISATIONAL CHANGE

Employee attitudes towards change are central to the success of organizational

change. Elias in Christopher and Douglas (2014) defined attitudes towards

change ‘as an employee’s overall positive or negative evaluative judgment of a

change initiative implemented by his or her organization’. According to Stephen

and Robbins (2009), attitudes refer to certain regularities of an individual's

feelings, thoughts and predispositions to act towards some aspect of his

environment. When employees are more positive about the change they are

29
likely to behave in ways that support the change, whereas when employees are

negative about the change they will resist and oppose the changes. Arnold et al.,

(1995), indicated that attitudes reflect a person's tendency to feel, think or

behave in a positive or negative manner towards the object of the attitude.

MANAGERS AND ORGANISATIONAL CHANGE

Managers comprises of managers who head specific departments or serve as

project managers for implementing the company policies and plans. According

to Werner (2007), managers consist of a diverse group of primarily

professionals rather than managers. Salami (2011) asserted that managers

develop action plans consistent with higher level objectives. They are also

expected to be team-oriented and able to work well with peers (horizontal

managers) and coordinate activities across the organization.

EFFECTS OF CHANGE ON EMPLOYEES ATTITUDE

Having highlighted the different forms of change common in the organization in

Nigeria, it is important to explain the effects of such change on employees and

managers involved. Change does not occur in a vacuum. Whenever it occurs,

there are detrimental effects that it can cause to the organization at large or to

individual members involved (Taylor & Cooper 1998, as quoted by Werner,

2007). These effects can be both positive and negative and they determine

future attitudes of employees towards change. Receptivity, resistance,

commitment, cynicism which inhibits success, stress, and related personal

30
reactions are clearly relevant criterion variables to be considered in the

framework of planning and implementing an organizational change. Studies

examined individuals' reactions to the announcements of change and reported

that their concerns and perceptions of both the personal and organizational

implications and outcomes of the change guide their reactions to the change

(Giangreco and Peccei, 2005).

FACTORS INFLUENCING ATTITUDES TOWARDS

ORGANIZATIONAL CHANGE

There are two major factors that affect attitudes towards organizational change.

They include external and internal factors. The external factors are demographic

need for personal growth, locus of control, internal motivation, past experience,

organizational commitment, types of the change, communication, degree of

involvement, and the threats and benefits posed by the change programme

(Werner, 2007; Salami, 2011). Salami (2011) included technological

advancement, market change and social and political pressure as part of external

forces for change.

THE NIGERIAN BANKING INDUSTRY

Nigerian Banking industry has made exceptional progress in last few years,

even during the times when the rest of the world was struggling with financial

meltdown (http://www.ibef.org/industry/Banking.aspx). The size of Banking

among services shows a very impressive and sound growth in the Banking

31
sector. However on the flip side, according to Olofin and Udoma (2010) Banks

are slashing jobs since 2008 global credit crisis due to slowing down of

operations. The loss of a lucrative job creates tremendous stress among

employees resulting in psychological problems like frustration, strain, anxiety,

etc, that creates a fear and may affect the performance of the Bank employees

which may ultimately affect growth of the Banking sector.

BENEFITS OF BANKING CONSOLIDATION

Some of the benefits of the consolidation of the Banking industry include

availability of funds for the small and medium scale enterprises, opportunity for

Nigerian Banks to explore other regional and international markets, reduction in

capital flight, massive and continuous innovations in the Banking sector,

externally-focused competition and restoration of confidence in the Nigerian

Banking Sector etc.

E-BANKING AND BANKS’ PERFORMANCE

A strong Banking sector is important to every country to stimulate economic

growth and to maintain financial stability for the whole financial system.

According to Al-Smadi (2011), information and technological revolution

motivated Banks to spend more on technology to maximize return and attracting

more customers who will not accept less than above-average services. In

addition, Banks have changed to keep up with the information technology and

communication developments. This change includes using the technology of

32
computer and communications to replace manual and paper operations to

electronic operations; electronic Banking (e-Banking) or internet Banking is the

commonly methods adopted by Banks Salhi and Alipour (2010).

BANK VERIFICATION NUMBER (BVN)

Another change in the Nigerian banking industry is the launching of a

centralized biometric identification system tagged “Bank Verification Number

(BVN)” by the Central Bank of Nigeria through the banker’s committee in

collaboration with all Nigerian banks in February 14, 2014. The BVN was used

to address existing challenges with identity management. The BVN gives each

Bank customer a unique identity across the Nigerian Banking industry that can

be used for easy identification and verification at Point of Banking operations

(Evangelista et al, 2001).

CONCEPTUAL FRAMEWORK

MANAGERS’ COMMITMENT AND ORGANIZATIONAL CHANGE

Lines (2004), defined organizational commitment as the relative strength of an

individual's identification and involvement in a particular organization. Vakola

and Nikolaou (2000), conceive commitment as an attitude that reflects the

nature and quality of the linkage between an employee and an organization. It is

argued that commitment often establishes an exchange relationship in which

individuals attach themselves to the organization in return for certain rewards

from the organization (Robbins & Odendaal 2005). Individuals come to

33
organizations with certain needs, skills, expectations and they hope to find a

work environment where they can use their abilities and satisfy their needs.

When an organization can provide these opportunities, the likelihood of

increasing commitment is increased.

There is evidence in the change management literature identifying the role of

organizational commitment in a change context. Many authors indicated that

organizational commitment plays an important role in employee's acceptance of

change (Darwish, 2000). Communication of Change Process and Organizational

Change A divergence exists concerning the frequency and level of

communication shared with employees and the proper delivery modalities

(Kupritz & Cowell, 2011). Given the improvements of communication and

information sharing technologies, organizations have more resources to

communicate change. The complexities of the process combined with human

emotions can complicate the change process (Bisel, Messersmith, & Keyton,

2010).

Effective communication also entails an understanding of the nuances of

organizational operations as well as the organizational culture (Summers,

Humphrey, & Ferris, 2012). Communication strategies that work well in one

organization are not necessarily transferable to other organizations (French &

Holden, 2012). Managers’ Past Experience and Organizational Change One of

the factors that might affect attitudes towards organizational change is previous

34
experience. Examples of such experiences include stress created by bad work

relationships, overload and unfair pay and benefits. All these can cause negative

attitudes toward organizational change and, therefore, inhibit change processes

(Bovey & Hede, 2000). More emphasis was invested on previous lack of a

socially supportive environment, as expressed by bad work relationships, which

was found to be the strongest predictor of negative attitudes towards change.

Furthermore, Damanpour (1991) indicated that, job insecurity may also become

an obstacle to change with evidence from the literature suggesting that job

security is associated with organizational commitment, which is associated with

positive attitudes to organizational change. Therefore, individuals who are

guaranteed job security have a potential possibility of being positive about

change but those whose jobs were once threatened may have negative attitudes

towards change (Oreg, 2006).

PARTICIPATION IN THE CHANGE EFFORT AND

ORGANIZATIONAL CHANGE

According to Lines (2004), participation can be defined as involvement in the

initial assessment and development of the change plan as well as the right to

veto in addition to participating in the process. Several studies found that

participation in change initiatives was associated with more positive views of

the change, reduced resistance, and improved goal achievement (Chreim, 2006).

The Giangreco and Peccei (2005), study of managers in general in an Italian

35
electric company, reported that employee perceptions of their participation in

the development and implementation of the change initiative was associated

with more positive attitudes towards the change and reduced resistance to

change. Moreover, Lines (2004), found similar results in a self-report survey

study of 138 managers of a telecommunication company involved in a major

strategic reorientation. There are reported strong relationships between

employee perceptions of their participation and goal achievement,

organizational commitment, and reduced resistance.

NATURE OF BANKER-CUSTOMER RELATIONSHIP IN THE WAKE

OF ELECTRONIC BANKING

Traditionally and historically, the legal nature i.e. the inherent essential quality

without which the banker-customer relationship cannot exist is the contractual

nature of the relationship. In other words, the relationship only ensued by

contract with all the attendant implications; i.e. offer, acceptance, intent to

create legal relationship and consideration. All other relationships capable of

ensuing between the customer and banker are considered secondary and never

the essence of the relationship. In the sense that they all proceed and are only

capable of ensuing from the banker-customer relationship only when both the

banker and customer had contractually tied up their relationship. It is submitted

36
that the legal nature of the banker-customer relationship is primarily and

generally contractual. To hold otherwise will manifest absurdity, as done in the

case of Foley v. Hill (1848), where the court held the nature of the banker-

customer relationship to be primarily that of debtor-creditor in spite of the

plaintiff contention that the relationship was not one of debtor-creditor

relationship but that of trustee-beneficiary. Surprisingly, in the same case, Lord

Cottenham rightly postulated that money when paid into a bank ceases to be the

money of the principal, it is then the money of the bank who is bound when

asked for it, to return same with interest as the case may be. The bank is known

to deal with it as his own, he makes whatever profit he can, which profit he

retains to himself paying back only the principal according to the custom of the

banker.

BENEFITS OF CUSTOMER RELATIONSHIP MANAGEMENT

Benefits to Bank Wetsh L.R. (2005) states that there are significant business

benefits derivable from an integrated Customer relationship management

approach. These include:

1) Reduced costs, because the right things are being done (i.e. effective and

efficient operation). 2) Increase customer satisfaction, because they are getting

exactly what they want (i.e. exceeding expectations)

3) Ensuring that the focus of the organization is external

4) Growth in number of customers

37
5) Maximization of opportunities (i.e. increased services, referrals)

6) Increase access to a source of market competitor information.

7) Highlighting poor operational processes.

8) Long term profitability and sustainability

A Customer Relationship Management {CRM} program that is successful will

help a company to create wealth and sustain growth by linking with customers

and receiving value through the relationship. Companies cannot generate

sustainable growth without growing the value of its customer base. A

disciplined CRM program can assist the company to realize relationship value

and growth either through effective targeting or acquiring customers, cross-

selling, cultivating existing relationship and by improving customer loyalty

(Cap, Gemini, et al 2005).

BENEFITS TO CUSTOMERS

1. Risk and stress reduction

2. High quality service since the service provider becomes knowledgeable about

customers requirements.

3. Social and status benefits from continuity relationships with a supplier since

repeated contract may develop relationship resembling personnel friendship

which can feed one’s status (ego).

38
4. Avoiding switching cost because maintaining a relationship with a supplier

avoids the cost associated with switching to a new provider.

CHALLENGES IN CUSTOMER RELATIONSHIP MANAGEMENT

IMPLEMENTATION

Pokharel (2011) summarized the challenges banks face in implementing

Customer relationship management to include:

1. Getting management sponsorship

2. Quality of customer data

3. Alignment issue (alignment of people and processes)

4. Lack skilled people

5. Determining the right time for customers’ needs

6. Incorporation of customer data and customer preferences to the customer

database

7. Using the real technologies

8. Real time data across all customer channels

9. Using customer data more intelligently

10.Having 3600 view of customers (single view of customers)

39
MAINTAINING BANKER-CUSTOMER RELATIONSHIP THROUGH

CUSTOMER RETENTION, CUSTOMER SATISFACTION AND

CUSTOMER LOYALTY

Customer Retention The essence of any business is to create value for the

stakeholders, and this value creation as a measure of performance, can only be

generated through the provision of goods and services that are required to meet

consumers’ needs. The lifetime of a banker-customer relationship is linked to

the retention rate, and as the retention rate, and as the retention rate increases,

the customer life increases. Improving the retention rate from 85% to 87%

increases the customer life from 6½ to 7½ years. The cost of winning a new

customer can be up to five times more than keeping an existing one, which

reduces the return on investment and lengthens the payback period (Toole,

2007).

Customer Satisfaction It is no longer business as usual for financial institutions

around the world. They are facing intense customer service pressure than ever

before. They are more customers-focused with their strategies and tools that

allow development of better relationship between bank and customer. Banks

put more effort in providing quality services in order to prevent failure; they are

aware that when failure occurs, their responses have the potentials of restoring

customer satisfaction and reinforce loyalty; otherwise, it may drive customers to

competing firm. Customer satisfaction is the evaluation of post-activity of the

40
interior state of the customer’s feelings towards past purchase and experience of

shopping (Peppers & Rogers, 2005). In addition, customer satisfaction has been

argued that it is based on cumulative experience gathered by customer rather

than being a “transaction-specific phenomenon” (Leverin, A. &Liljande, V.

2006). He argued that customers are not likely to switch to competitors with a

dissatisfaction of a single transaction and neither would they be satisfied and

remain loyal for a single error-free completed transaction. ACSI (2006) define

service quality as “a measure of the customer’s evaluation via recent

consumption experience of the quality of a company’s products or services”.

Measuring product or service quality depends on its customization to meeting

customer’s needs and its reliability. That is, the frequency at which failure is

witnessed. Customers who return for more business tend to be satisfied with the

value received, and their satisfaction is a source of energy and pride for

employees. American Customer Satisfaction index is a model used in evaluating

the level of customers’ satisfaction with quality of services rendered by all lines

of businesses in order to give details about customer loyalty and customer drain.

The model is a good instrument to evaluate the efficiency of resources at macro

level. In the past, customers’ survey was used to access the model.

CONCLUSION

The aim of this project is achieved if all it does is to sensitize the stakeholders

within the Banker-Customer Relationship that it is no more business as usual

41
with the emergence of internet banking and provoke serious reflections on the

legal framework for banking in the internet banking era. Caution indeed should

now be a virtue so as not to initiate a banker-customer relationship when such

are not intended given the grave implications arising there-from in the

electronic banking era. It could be deduced from this research paper that

Customer Relationship Management (CRM) is very important in contributing to

the growth of a bank, as the world financial centre is becoming a global

neighborhood as a result of ICT that is currently redefining the competition

landscape.

42
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