SERVICE MARKETING

STATE BANK OF INDIA: SMS UNHAPPY CASE

SUMMARY

Karthik P
B2082
MBA-A
As Chief General Manager (South) of State Bank of India (SBI), Shiva Kumar had launched a
novel customer complaint management program dubbed “SMS Unhappy” in the southern state
of Andhra Pradesh. It was a breakthrough initiative in customer complaint management, aimed
at dramatically reducing the time it took to respond to customer grievances. The complaint
resolution process in some of the best-run branches of competing banks took between 10 to 12
days, whereas SBI branches under the SMS Unhappy program often managed to resolve issues
within 24 hours. SBI was ranked number one in Hyderabad, the capital city of Andhra Pradesh,
in a customer satisfaction survey by Hindustan Times, a leading national newspaper. It beat its
nearest rival by nine points. Shiva Kumar’s four-member SMS Unhappy team had satisfactorily
handled over 7,000 complaints in a span of just five months.
In December 2010, recently promoted to the position of Deputy Managing Director, Shiva
Kumar contemplated the next step in the evolution of the SMS Unhappy program. While the
early results from Hyderabad were encouraging, he wondered whether further testing of the
concept was necessary before a potential national rollout.
In 2006, SBI appointed O.P. Bhatt as its new Chairman, an SBI veteran of 34 years. He
encouraged employees to bring about changes that would help SBI become successful in the
present day. He initiated a campaign called “Parivartan,” which meant “transformation” in
Hindi. Another sequel to Parivartan was “Udaan” (meaning “flight”) which targeted employees
on the frontline.
SBI built robust IT infrastructure to support back-end operations. It invested in ATMs across
the country. It also introduced personal banking with more personalized customer service and
Vishesh (meaning “special” in Hindi) banking services for high income individuals. SBI began
to focus on areas such as treasury and financial markets, international banking, relationship
management and other non-banking financial services, such as insurance and mutual funds. It
also started a rural business group to extend its reach into India’s rural areas. It created a
division to look into new opportunities in financial services and enable SBI to keep abreast of
the latest developments. The bank renewed itself not only in spirit, but also in terms of its
physical facilities.
SMS UNHAPPY
The initiative was officially launched in the Andhra Pradesh (AP) circle on December 11,
2009.In its fully developed form, SMS Unhappy was a simple way for consumers to try and
resolve their complaints with SBI. A customer facing any problem with the bank merely had
to SMS the word “Unhappy” to a toll-free number, 800-820-2020. The bank would then call
the customer back within a maximum of 48 hours. In contrast to other complaint management
models that relied on basic call center-based operations, SMS Unhappy complaints were routed
to a Senior bank official at SBI. The 48-hour call back deadline proved to be a conservative
one during the test phase, with several reported instances of customers receiving a return call
from the bank even before they left the branch from which they had sent the SMS.
Prior to SMS Unhappy, the AP region of SBI received an average of 1,600 complaints per year.
However, in the 11 months following the launch of the program, the number of complaints
went up to 22,209. Of these, 21,805 were addressed as committed and brought to a satisfactory
closure.
SWOT ANALYSIS- SBI's SMS Unhappy Strength

• SBI’s brand image & credibility

• Experienced & dynamic Organogram

• Huge market share including rural area

Weakness

• Lack of accountability

• Inadequacy of efficient mechanism

• Red tape & bureaucracy

Opportunity

• Good market response assessed by Pilot program in AP

• Expansion of Telecommunication market

• Precise market segment- young professionals & students

Threat

• Reputation at stake

• Frivolous complaints & Unpredicted scalability of complaints & operational

challenges

• Competitors’ strategy