1.1 Background and previous studies
The idea of my Master’s Thesis topic has a lot to do with my personal experience working in the financial industry as well as working in other various customer service roles. I have been interested in customer experience for a long time and majoring in Service Management it felt natural to pursue my interest in this study. Bank mergers have been in the headlines in Finland in the recent years, therefore this topic is also very intriguing and current.
Customer experience has been an interest of lot of studies, especially in the past decade, but to my knowledge customer experience management after a merger, or after any major organizational change, has not been studied before. There are several studies about customer experience management e.g. Verhoef et al. (2009); Parandker
& Lokku (2012); Frow & Payne (2007); Ryder (2007); Johnston & Kong (2011);
Hwang & Seo (2016); Berry & Carbone (2007). They all have different perspectives of the main concerns about customer experience management but also lots of
similarities. The similarities were the understanding what effects on the customer experience as well as understanding the customer journey and customer touchpoints.
The differences were mostly in what are considered the most crucial issues to focus on when managing the customer experience.
Impacts of mergers and acquisitions on the other hand have been studied rather in a financial basis and the focus has been in the organizational fit between the merging parties. Kumar (2012) in their study of mega mergers and acquisitions have focused on the merger motives and Anderson et al. (2003) have researched how customers and suppliers in the merging companies perceive and behave in relation to a merger. In their research Focarelli & Panetta (2003) have studied if mergers are beneficial to customers, but have concluded that constructing such measure is impossible.
In my research, I have companied customer experience management and a merger and found a research cap and with this case study I wanted to get more insight on this phenomenon. I have chosen to study one specific merger in the OP financial group.
The merger was said ultimately benefit customers because one of its main goals was to ensure more professional and diverse customer service. Therefore, I wanted to research how has the bank created and managed its customer experience after a merger.
1.3 Objectives and research questions
The objective of this study is to find out how has the bank created and manged its customer experience. What have been the challenges and advantages and draw some critical success factors according to customer service experience. One of the main purpose in a bank merger is to certify services to their customers in the future. Small banks are often going through financial hardships and merger is the only option to continue. The message that the banks want to give their customers about the merger is that it is beneficial for the customers. After a merger, they can provide better and diverse services and this way create more value for the customer and over all better the customer experience.
The key is to identify and demonstrate bank’s customer management strategies after a bank merger. First it is important to know how does the bank define and create
customer service and how do they conduct customer experience management. After that one can add the component of merger and draw more specific research question which in this study are:
1. How does the bank create and manage customer experience after a merger?
2. What challenges has the merger created in relation CEM?
3. What advantages has the merger created in relation to CEM?
4. What are the critical success factors in CEM after a merger?
The support questions give more value for this study, answering what challenges and advantages a merger creates in relation to customer experience management will help the reader understand the considerable effect a merger has on a company and its customers. Once one has been able to get answers to these three research questions, it is also rational to answer what are the critical success factors in customer experience
management after a merger. This will hopefully give some insights for what factors to specifically keep in mind in when new banks are merging in the future.
The nature of this study is descriptive and therefore it is conducted as a qualitative study. And the data was gathered using a semi-structured interview. Six people in total were interviewed. One of them was Governance Lead in OP Financial Group who has years of experiences of mergers. The chosen bank was willing to be studied even though the nature of the study is somewhat sensitive. It is known that big
organizational changes can be stressful and cause tension within the company. As the focus is on the customer experience and its’ management, it was important to take into consideration all the emotions of the interviewees. The interviews were conducted over a year after the merger for that specific reason and because it was more relevant to study the customer experience management after the dust had settled and the merger was truly assimilated.
1.4 Key concepts and structure
Key concepts in this study are the concept of customer experience, which is the relationship between the customer and the company, where value is created in both ways and is influenced by several components. (Gentile et al. 2007; Grönroos &
Ravald 2009; Vargo & Lusch 2004). Creation of customer experience is about episodes where production of the service and the interactions between the service provider and the customer occurs. These episodes are called touchpoints and they create the customer journey. Within the journey there some elements that the company can and cannot control. (Maklan et al. 2017; Lemon & Verhoef 2007;
Rawson et al. 2013; Verhoef at al. 2009). This all leads to Customer experience management which means that companies need to understand the customer journey and try pre-control the customer experience in a way that it will create value both to the customer and the company. (Verhoef et al. 2009; Parandker & Lokku 2012; Frow
& Payne 2007; Ryder 2007; Johnston & Kong 2011; Hwang & Seo 2016). Measuring the customer experience is an important part of customer experience management. It would be ideal for firms to measure overall customer experience with one metric, but the problem in trying to measure customer experience is the complexity of context specific variables. One established metric to measure customer experience is still to
be discovered, but there are ways to measure different means of customer experience such as the loyalty aspect and the prospect of customers being great promoters for the company. (Palmer 2010; Lemon & Verhoef 2016; Reicheld 2003). It is also important to open the concept of financial industry and bank mergers. Financial industry
provides economic services and in a bank merger two or several banks amalgamate their asset and liabilities to become one bank. (Phillips 1999; Kumar 2012).
In the first chapter of this study there is a short preface which tells how the subject of the study was chosen. After that objectives and the research questions are shortly introduced to the reader, which are followed by key concepts and structure of the study. In the second chapter the concept of customer experience, its creation, management and measuring are being unfold. In the third chapter, important background concepts, financial industry and bank mergers, for this study are
introduced as well as the case company and merger in the case company. For this part I have interviewed a government lead who has been highly involved in most of the merger processes all over Finland within the case company. Chapter four contains the chosen methodology. Meanings of qualitative study, case study, semi-structured interview and primary data collection are demonstrated for the reader which is followed by the analysis of the data. In the fifth chapter findings of the study are being carefully shared. In the sixth chapter one can find summary and conclusions of the study with discussion, managerial application, study evaluation as well as study limitations and ideas for future research.