Citibank, a part of the Citigroup conglomerate based in the US, aimed to establish itself as a premier international financial company. To achieve this, it had to strive for perfect processes at every point of interaction with its customers across the world.

Venturing into Six-Sigma

Initially, Six-Sigma was associated with the manufacturing arena. However, Citibank took up the challenge of investigating and implementing this well-known quality management tool in its service environment.

Consulting an expert for the best assistance

Citibank first approached Motorola University Consulting and Training Services to impart training on Six-Sigma. The training helped Citibank devise a strategy for reducing defects as well as process cycle time.

I. Cycle Time Reduction (CTR)

Initially, Citibank developed a Cross Functional Process Mapping (CFPM) methodology with the help of Motorola University (MU) to implement Cycle Time Reduction (CTR).

At its core, CFPM involves elimination of all wasteful steps. Wasteful steps are all those activities that do not contribute to satisfying customer requirements. Studies reveal that in non-manufacturing companies, almost 90% of the activities do not add any value.

Citibank implemented its CFPM in five phases similar to the DMAIC approach.

• The planning phase - Critical business processes that required improvement were identified.
  
• The "As Is" session - The steps in each of these identified process were mapped as they usually took place. Problems, disconnects and non-value-adding activities were also recorded.
  
• Verify accuracy - The 'as is' mapping was then discussed with all the employees in the organisation to verify its accuracy and check if any other issues/problems were to be added.
  
• The "Should Be" process - Then the non-value-adding steps were eliminated to arrive at the desired streamlined process. This 'should be' process was designed in such a way that it worked faster and better than the "as is" state without requiring additional people or expenditure.
  
• Detailed design and implementation - Action teams were established with members from all departments of the organization. Project plans were created and progress was reviewed through monthly meetings and accomplishments were rewarded.

II. Identifying and reducing defects

Anything that causes dissatisfaction to a customer is called a defect. Achieving total customer satisfaction was not an easy task for Citibank. Although its customer satisfaction levels were good, Citibank noted that customers frequently complained with regard to:

• Services being slow and complicated
• Services lagging on innovation
• Systems not being state-of-the-art
• Inadequate priority to customer problems

A close look at the processes involved in the business transactions between Citibank's Private Bank and its customers revealed many flaws. A classic example was the case when customers initiated mutual fund transfers. To send money from their account, Citibank's customers had to call the banker, and send a requisition either by fax, phone or mail. It was a complicated process and customers complained frequently about the time taken for processing. Citibank also noted that when the bankers were engaged in other priority jobs, customer requests were delayed for hours before being sent to the back office for processing.

To achieve Six-Sigma, Citibank used simple tools like the Pareto chart. The data from the Pareto Chart helps to prioritize problems in terms of highest frequency of occurrence or highest expense. It gives direct evidence of the problem to be rectified.

Citibank aimed to reduce defects and process cycle times by at least 10 times by the end of the first year of implementation. It aimed for a further 10 times reduction every two years. A team comprising bankers and operations personnel studied the entire fund transfer process, identified and tabulated defects, and then analyzed them using Pareto charts.

The team noted that its internal call back procedure was high on the defect chart. In this internal call back process, a banker from Citibank had to call back the customer and ensure whether the instructions were recorded correctly. Citibank, along with facilitators from Motorola University, devised refinements to simplify this process.

After the revised process came into effect, Citibank found that the number of monthly callbacks dropped from 8,000 to 1,000. The new process eliminated 73% of the incoming transactions.

Conclusion

The company's goal of becoming a premier financial company of the millennium requires a devotion to quality and excellence on the part of every employee of Citibank. Although a highly ambitious goal, Citibank has already succeeded in implementing many a quality initiatives. These initiatives aim for customer satisfaction at the point of every interaction anywhere in the world.

Deep commitment, flexibility to changes, smart use of information technology and operations management have been the key driving factors at Citibank.