How do customers of a financial services institution judge its communications

Communications are important for relationships within a marketing channel from both a theoretical and managerial perspective. Yet it is a problematic area for scholars. Thus, this research addresses the problem of how do customers of a financial services institution perceive communications with an ideal institution? This study's case research methodology used in-depth interviews with 34 carefully selected customers of a building society. The factors that make up customers' attitudes about corporate communications for an ideal financial services institution were identified and actual perceptions were compared against that ideal. The findings confirmed the importance of communications for customers in a relationship with a financial services provider and suggested communication priorities for customers in this context. In addition, the findings suggested sources of communication dissatisfaction for customers. These findings build upon the literature that speculates about customer perceptions of communications with organizations but provides little evidence to support hypotheses. The contributions arose from the emphasis on the customers' own attitudes and the patterns found within them.

Are the financial services external complaints resolution schemes subject to judicial review?

In Australia seven schemes (apart from the Superannuation Complaints Tribunal) provide alternative dispute resolution services for complaints brought by consumers against financial services industry members. Recently the Supreme Court of New South Wales held that the decisions of one scheme were amenable to judicial review at the suit of a financial services provider member and the Supreme Court of Victoria has since taken a similar approach. This article examines the juristic basis for such a challenge and contends that judicial review is not available, either at common law or under statutory provisions. This is particularly the case since Financial Industry Complaints Service Ltd v Deakin Financial Services Pty Ltd (2006) 157 FCR 229; 60 ACSR 372 decided that the jurisdiction of a scheme is derived from a contract made with its members. The article goes on to contend that the schemes are required to give procedural fairness and that equitable remedies are available if that duty is breached.

Preliminary review of over-regulation in Australian financial services

This article examines a preliminary review and the limited evidence of over-regulation in Australian financial services. The 1997 Wallis Report and the CLERP 6 paper resulted in the amendments to Ch 7 of the Corporations Act 2001 (Cth) by the Financial Services Reform Act. Nearly a decade later the system based upon 'one-size fits all' dual track regime and a consistent licensing regime has greatly increased the costs of compliance. In the area of enforcement there has not been a dramatic change to the effective techniques applied by ASIC over other agencies such as APRA. In particular there are clear economic arguments, as well as international experiences which state that a single financial services regulator is more effective than the multi-layered approach adopted in Australia. Finally, in the superannuation area of financial services, which is worth A$800 billion there is unnecessary dual licensing and duplicated regulation with little evidence of any consumer-member benefit but at a much greater cost

The regulation of insurance intermediaries in the Australian financial services market

The insurance industry discharges a critical role in the Australian economy and is a significant part of the Australian financial services market. The industry relies upon intermediaries, the principal types being brokers and agents, to promote, arrange and distribute their products and services in the market. The pivotal role that they play in this context and sensitivities associated with the consumer oriented products, such as house and contents insurance, has ensured close regulatory attention. Of particular importance was the passage of the Insurance (Agents and Brokers) Act 1984 (Cth), a comprehensive attempt to address the responsibilities of intermediaries as well as particular problem areas associated with the handling of money. However, with the introduction of financial services and market reform early in the new millennium this insurance intermediary specific regulatory approach was abandoned in favour of a market-wide strategy; that is, market reform was based upon across-the-board licensing, disclosure, conduct and fairness standards, and all financial products and services are now regulated at a generic level under Ch 7 of the Corporations Act 2001 (Cth). This article briefly explores the categories of insurance intermediaries and the relevant distinctions between them but focuses mainly upon the regulatory context in which they operate. This context transcends a strictly legal framework as the regulatory body, the Australian Securities and Investments Commission (ASIC), has sought to inform and guide the market through Policy Statements and Regulatory Guides. The usefulness of these guides as an adjunct to the legislation in explaining the scope and operation of regulatory framework is examined. In addition, the article looks at the self-regulatory and dispute resolution practices in this area and their impact. In conclusion an assessment of this across-the-board regulatory regime is advanced.

The financial services cultural orientation matrix

With saturation within domestic marketplaces and increased growth opportunities overseas, many financial service providers are investing in foreign markets. However, cultural attitudes towards money can present market entry challenges to financial service providers. The industry would therefore benefit from a strategic model that helps to align financial marketing mixes with the cultural dimensions of a foreign market. The Financial Services Cultural Orientation (FSCO) Matrix has therefore been designed, with three cultural dimensions identified which influence preference for financial products; preference for cash, aversion to debt and savings orientation. Based on a combination of these dimensions and their relative strength within a culture, eight different consumer segments for financial products are identified, and marketing strategies for each consumer segment are then proposed. Three cultural clusters from the GLOBE Project House et al. (2002) are used to highlight possible geographic markets for each of these consumer segments. In particular, this paper focuses on GLOBE’s Confucian Asia, Southern Asia and Anglo cultural clusters, as these clusters represent the most well established financial markets in the world and the fastest growing financial markets for the future. The FSCO Matrix provides the financial services industry with an innovative and practical tool for addressing cross-cultural challenges and developing successful marketing strategies for entry into foreign markets.

Prioritizing process improvement : an example from the Australian financial services sector

Process improvement has become a number one business priority, and more and more project requests are raised in organizations, seeking approval and resources for process-related projects. Realistically, the total of the requested funds exceeds the allocated budget, the number of projects is higher than the available bandwidth, and only some of these (very often only few) can be supported and most never see any light. Relevant resources are scarce, and correct decisions must be made to make sure that those projects that are of best value are implemented. How can decision makers make the right decision on the following: Which project(s) are to be approved and when to commence work on them? Which projects are most aligned with corporate strategy? How can the project’s value to the business be calculated and explained? How can these decisions be made in a fair, justifiable manner that brings the best results to the company and its stakeholders? This chapter describes a business value scoring (BVS) model that was built, tested, and implemented by a leading financial institution in Australia to address these very questions. The chapter discusses the background and motivations for such an initiative and describes the tool in detail. All components and underlying concepts are explained, together with details on its application. This tool has been successfully implemented in the case organization. The chapter provides practical guidelines for organizations that wish to adopt this approach.

Emissions trading and the GATS financial services provisions : a case study of the Australian carbon pricing mechanism

Purpose The purpose of this paper is to determine whether greenhouse gas (GHG) tradeable instruments will be classified as financial products within the scope of the World Trade Organization (WTO) law and to explore the implications of this finding. Design/methodology/approach This purpose is achieved through examination of the units of the Australian Carbon Pricing Mechanism (CPM), namely eligible emissions units. These units are analysed through the lens of the definition of financial products provided in the General Agreement for Trade in Services (the GATS). Findings This paper finds that eligible emissions units will be classified as financial instruments, and therefore the provisions that govern their trade will be regulated by the GATS. Considering this, this paper explores the limitations that are introduced by the Australian legislation on the trade of eligible emissions units. Research limitations/implications This paper is limited in its analysis to the Australian CPM. In order to draw conclusions on the issues raised by this analysis it is necessary to consider the WTO requirements against an operating emissions trading scheme. The Australian CPM presents a contemporary model of an appropriate scheme. Originality/value The findings in this paper are crucial in a GHG constrained society. This is because emissions trading schemes are becoming popular measures for pricing GHG emissions, and for this reason the units that are traded and surrendered for emissions liabilities must be classified appropriately on a global scale. Failing to do this could result in differential treatment that may be contrary to the intentions of important global agreements, such as the WTO covered agreements.

Engineering a financial bloodbath: how sub-prime securitization destroyed the legitimacy of financial capitalism

"This book investigates the origins and implications of the securitization crisis, described by the chief executive of ANZ as a "financial services bloodbath". Based on extensive interviews it offers an integrated series of case studies drawn from the United States, the United Kingdom and Australia. A central purpose is to not only chart what went wrong with the investment houses and why the regulatory systems failed, but also provide policy guidance. The book therefore combines the empirical with the normative. In so doing, it provides a route map to navigate one of the most significant financial and regulatory failures in modern times."

‘I can’t get no satisfaction’...or can I? A study of satisfaction with financial planning and client wellbeing

This paper reports findings from an ongoing collaborative research project with the Financial Services Council (FSC), which contributed funding and facilitated the survey of financial planners’ clients through FSC member organisations. The article draws on the report to the FSC that was prepared by the QUT researchers, reporting findings on the initial exploratory stage of the project.1 The lyric in the title of this paper has become a catchcry for consumers dissatisfied with a range of financial services and products, and, as recent Federal Government inquiries have revealed, there is some truth to the claim. But as financial planning undergoes a series of reforms, including increased professionalism (FPA 2009) and improved quality of advice (Australian Government 2011), there are good reasons to explore the conditions under which clients report satisfaction with their financial planners; not least because the provision of effective financial planning and advice, delivered in accordance with, or transcending, the rules and norms of industry best-practice has the potential to benefit clients, not just financially, but across a number of life domains. In this paper, we report findings from an exploratory study investigating whether financial planning and advice contribute to client well-being, beyond effects on financial well-being. While anecdotal evidence supports psychological benefits such as a sense of security, little research has explored these links in any systematic or theoretically driven way. However, theory and research from cognate disciplines, such as psychology, indicate clear links between planning, goal setting and well-being that are likely to arise in the financial planning domain. Surveyed clients were asked to indicate their satisfaction with their financial advisers, the planning process and the advice they received. Clients responded to items designed to reflect key areas for financial planners in the shift towards increased professionalism, improved disclosure and greater client focus (e.g. FPA 2009). Clients also reflected on their financial situations before and after seeing their advisers, and considered the impact of their financial situations on a number of life areas including family relationships, mental health and well-being, and overall life satisfaction.

Implementing a six sigma initiative in financial service companies

In a world of intense competition, Six Sigma is considered to be an important management philosophy, supporting organisations in their efforts to obtain satisfied customers. As financial service organisations have been slow to adopt Six Sigma, issues concerning its implementation are of major importance. For its implementation a large number of tools and techniques have been suggested by academics and practitioners. Intriguingly, despite the extensive effort that has been invested and benefits that can be obtained, the systematic implementation of Six Sigma in financial service organisations is limited. This paper presents a conceptual framework derived from literature and empirical results with a focus on financial services. Using this framework a financial service company should be able to cope with the relevant critical success factors. Thus, the framework allows identifying relevant aspects for a sustainable and successful implementation of a Six Sigma initiative.

Developing a framework for Six Sigma in financial service institutions : empirical evidence from expert interviews

Six Sigma is considered to be an important management philosophy to obtain satisfied customers. But financial service organisations have been slow to adopt Six Sigma issues so far. Despite the extensive effort that has been invested and benefits that can be obtained, the systematic implementation of Six Sigma in financial service organisations is limited. As a company wide implementation framework is missing so far, this paper tries to fill this gap. Based on theory, a conceptual framework is developed and evaluated by experts from financial institutions. The results show that it is very important to link Six Sigma with the strategic as well as the operations level. Furthermore, although Six Sigma is a very important method for improving quality of processes others such as Lean Management are also used This requires a superior project portfolio management to coordinate resources and projects of Six Sigma with the other methods used. Beside the theoretical contribution, the framework can be used by financial service companies to evaluate their Six Sigma activities. Thus, the framework grounded through literature and empirical data will be a useful guide for sustainable and successful implementation of a Six Sigma initiative in financial service organisations.

Embedded digital creative workers and creative services in banking

This chapter explores the roles and functions of both digital creative workers and creative services firms in an industry beyond the core creative industries: banking. The chapter focuses on the design and development of apps and mobile websites for smartphones and tablet computers, with examples drawn principally from the Australian banking sector. While it might be assumed that utility and practicality are more critical and more highly valued in apps development for financial services institutions than innovation and aesthetic design, this chapter illustrates the growing importance placed on creative work in this sector.

Creative services, apps and banks in Australia

This paper is divided in to three parts. The first part discusses recent CCI research on employment in creative services, with particular focus on the 'creative trident' model, and the distinction between cultural production and creative services occupations. The second part discusses the growth of the app economy and related employment details. The third part discusses mobile banking use, financial services and mobile devices, and apps created by or for banks.

Fraud and its PREY : conceptualising social engineering tactics and its impact on financial literacy outcomes

Financial literacy may not be as effective as previously thought in protecting against fraud victimisation. It does not inoculate investors from persuasion or social engineering tactics used by offenders to secure investment in fraudulent schemes. In fact, recent research indicates that overconfidence in investment knowledge may make individuals more susceptible to fraud. Using boiler room fraud as a case study, this article introduces the PREY (Profiled, Relational, Exploitable and Yielding) model to capture the psychological tactics used by fraud perpetrators to influence the thoughts and decision-making processes of individuals. The PREY model operationalizes the tenets of social engineering and demonstrates how such tactics could be re-engineered to increase the effectiveness of fraud prevention within the financial literacy context.