LPG, QMS & EMS News and Resources

Towards Improving Banking Services Quality 2. Introduction – Lean Banking   Many wonder or ask whether Lean management can be effectively applied in the financial services industry, particularly in banks. While Lean originated in manufacturing, where tangible goods are produced, banking is a highly process-intensive service sector. This makes Lean principles not only applicable but valuable for enhancing operational efficiency in banking. Recognizing this, many financial services organizations, including banks, have implemented Lean management to streamline their processes, reduce waste, and improve customer satisfaction.   Applying Lean principles in banking can be termed "Lean Banking." Lean Banking is a structured approach to identifying and eliminating non-value-added activities across all areas of banking. This strategy helps banks to cut costs, optimize processes, and improve overall service delivery to customers. Lean Banking witnesses that Lean’s benefits are not limited to manufacturing but are achievable in services-oriented industries as well.   The key objectives of Lean Banking are:   ·       Identifying Waste and Inefficiencies: Lean Banking focuses on detecting and eliminating waste (Muda) in various processes. Waste in banking can appear in the form of excessive paperwork, redundant approvals, delays in processing, or overstaffed functions that do not contribute directly to customer satisfaction.   ·       Enhancing Customer Experience: By removing inefficiencies, banks can reduce waiting times, simplify customer interactions, and provide faster, more reliable services, leading to higher customer satisfaction and loyalty.   ·       Optimizing Staff Utilization: Lean enables banks to maximize the potential of their employees, ensuring that tasks are aligned with their skills and eliminating redundant roles or unnecessary tasks. This not only reduces operational costs but also enhances staff morale and productivity.   Lean banking helps in:   1.       Reducing Loan Processing Time: Traditionally, banks may take time to process loans due to multiple approval steps, extensive paperwork, and rigid departmental silos. By applying Lean banking, some banks have restructured their processes, reducing the number of approvals required, digitizing paperwork, and automating steps where possible. As a result, loan processing times have dropped from weeks to mere days, providing faster service and a more pleasant experience for customers.   2.       Streamlining Account Opening Procedures: Account opening often involves multiple steps, forms, and verification procedures. A Lean approach can eliminate unnecessary steps and introduce digital verification, reducing the time it takes to open an account. For instance, some banks have implemented online KYC (Know Your Customer) and digital document submission, allowing customers to open accounts from the convenience of their homes, in less than an hour.   3.       Reducing Teller Queues with Workflow Adjustments: In a Lean bank, front-line staff, like tellers, are empowered to handle a range of customer inquiries and transactions, eliminating the need for customers to be referred to multiple departments. For example, banks have implemented Lean by cross-training staff to handle common inquiries, thereby reducing queues and speeding up service times.   Addressing Common Concerns   There is often initial doubt as to whether Lean management can be applied in the financial services industry, as it was initially developed for manufacturing. However, Lean principles are adaptable and can drive substantial benefits in banking by focusing on process efficiency. Many banks have already proven this approach effective, showing how Lean methodologies like the Kaizen (continuous improvement) mindset can enhance customer service, reduce costs, and streamline operations.   Lean Banking Culture   As Lean Banking practices take shape, they foster an organizational culture rooted in continuous improvement. This mindset encourages all employees to contribute ideas for streamlining processes and improving customer satisfaction, creating an environment where efficiency is constantly pursued. In Lean Banking, unnecessary steps are systematically removed, and processes flow more efficiently. As waste is minimized, processes accelerate, costs decrease, and the bank becomes better equipped to serve its customers. Studies indicate that banks applying Lean principles have reduced their operational costs. This structured, sustainable approach not only strengthens the bank’s bottom line but also builds a responsive, customer-focused organization.   I welcome your comments, questions and suggestions.   Warm regards, Keshav Ram Singhal 

Towards Improving Banking Services Quality 1. Introduction – Lean Management   After World War II, resource scarcity, such as manpower and raw material shortages, led Japanese organizations to adopt principles that ultimately gave rise to Lean Management. Toyota, under the guidance of Taiichi Ohno and Shigeo Shingo, developed the Toyota Production System (TPS) as a response to these constraints, which transformed the auto industry and became the foundation of Lean Management. Thus, Lean Management originated in Japan.   Initially applied in the manufacturing industry, Lean Management principles are now utilized across diverse sectors, including services like banking, healthcare, transportation, logistics, and construction. In the banking sector, Lean Management offers several benefits: improved customer satisfaction, faster processing times, reduced operational costs, and enhanced employee morale. By adopting Lean principles, banks not only cut operational costs and reduce processing times but also elevate customer satisfaction. Shorter loan approval times and streamlined services make banks more responsive to clients' needs, building loyalty and trust.   A significant focus of Lean Management is on eliminating waste, known as "Muda." In banking, waste can appear as excessive paperwork, prolonged wait times, or inefficient customer service interactions. By addressing these inefficiencies, banks can streamline processes to deliver better, faster services to clients, directly translating to higher satisfaction and lower operational costs. For instance, some banks have successfully reduced loan processing times from weeks to mere days by applying Lean principles to each stage of the workflow. Today, Lean processes are applied globally by organizations seeking to address inefficiencies impacting their bottom line.   Inspired by the Toyota Production System, Lean Management organizes and manages work to improve an organization’s performance, particularly the quality and profitability of its processes.   Lean is considered a philosophy of continuous improvement. A Lean organization focuses on increasing customer value, eliminating waste, and optimizing operations. The essential components of Lean can be applied across all types of businesses and processes. The main purpose of Lean Management is to create value for the customer by optimizing resources.   Dr. Shigeo Shingo, an industrial engineer and major consultant at Toyota, played a significant role in Toyota’s Lean journey. He understood that the success of Lean manufacturing lay in integrating people with efficient processes. In 1960, Shingo developed the Single Minute Exchange of Die (SMED) system, which aimed to reduce setup times and eliminate quality defects. His contributions, such as the kaizen concept, emphasized continuous improvement and became central to Lean philosophy.   The term “Lean Thinking” was coined by James P. Womack and Daniel T. Jones to encapsulate their study of Toyota's Production System. Lean Thinking encourages a mindset that recognizes inefficiencies and identifies waste inadvertently created by the organization of processes. This perspective enables businesses to streamline workflows, improving both quality and resource efficiency across various sectors.   In short:   - Lean is doing more with less time, fewer resources, less inventory, and less manpower, or, - Lean is achieving more with the same resources.   Lean Management is a powerful strategy for organizations seeking to survive, thrive, and grow successfully.I welcome your comments, questions and suggestions.Warm regards,Keshav Ram Singhal 

 Introduction to the Blog Series: Towards Improving Banking Services Quality   Dear Readers,   Welcome to an exciting new series on this blog, "Towards Improving Banking Services Quality." In today’s rapidly evolving financial landscape, delivering high-quality service in banking has become both a differentiator and a necessity. This series draws inspiration from my Kindle book, Future Banking is Lean Banking (available on Amazon), which I am currently revising. I am eager to share insights from this work with all of you, and I look forward to your valuable feedback as we embark on this journey together.   The focus of this series is Lean Banking—a transformative approach aimed at enhancing efficiency, increasing customer satisfaction, and implementing value-driven improvements across the financial services industry. Over the coming weeks, I’ll be sharing revised chapters and ideas that explore how Lean principles apply to banking. Through practical strategies, we’ll look at how to streamline processes, reduce waste, and ultimately enhance the customer experience.   Why This Series?   Achieving high-quality service in banking demands a continuous improvement mindset. The purpose of this series is not just to share knowledge but to open a conversation. I welcome your comments, questions, and suggestions as each chapter unfolds. Your insights will be instrumental in refining these concepts and ensuring that Future Banking is Lean Banking becomes even more relevant and impactful for readers.   What to Expect   Each post in this series will dive into specific aspects of Lean Banking, including:   ·       Reducing inefficiencies to improve customer service ·       Optimizing banking processes for operational excellence ·       Building a Lean-focused culture within banking organizations   Through these posts, I hope to provide practical insights that bank professionals, financial service providers, and quality management enthusiasts can directly apply in their work.   Join the Conversation   I invite you to join me on this journey, offer your valuable feedback, and help shape these ideas into actionable improvements. Additionally, I request that you bring this series to the attention of banking management executives who could greatly benefit from understanding and applying these principles within their organizations.   Together, let’s explore how Lean Management can pave the way for a more efficient, customer-focused banking experience. Your experiences, insights, and feedback will enrich this conversation and help shape the book’s content further.   Thank you for joining me on this path toward improving the quality of banking services. I look forward to your participation and contributions!   Warm regards, Keshav Ram Singhal  

Revision of ISO 9001:2015 Quality Management System (QMS) Standard   In February 2024, the ISO 9001:2015 Quality Management System (QMS) standard was amended to integrate climate change considerations, reflecting global sustainability demands.   Key Amendments:   ·       Clause 4.1 – New requirement: Organizations must assess whether climate change poses a relevant issue within their operational context.   ·       Clause 4.2 – Added note: Relevant interested parties may have needs and expectations related to climate change.   Potential ISO 9001 Revision Timeline   The ISO 9001:2015 standard is currently under review for a potential revision. The International Organization for Standardization (ISO) typically revises standards every five years, but updates to ISO 9001 have historically ranged between 6 and 10 years. Initial discussions targeted a 2025 publication, but the revised standard is now expected in 2026.   As with previous updates, this revision process will incorporate feedback from industry experts and user groups to maintain the standard’s relevance in today’s quality management practices.   Focus of the Revision   The revision is expected to:   ·       Align ISO 9001’s structure with other management system standards (e.g., Annex SL).   ·       Clarify specific requirements in the annex to reduce ambiguity.   ·       Potentially address new areas, including:   o   Ethics, integrity, vision, mission, and values.   o   The role of quality culture in fostering organizational resilience.   o   Managing risks and opportunities in dynamic environments.   While no fundamental changes to the core structure of ISO 9001 are planned, these updates are intended to harmonize ISO 9001 with other standards, clarify existing requirements, and emphasize factors such as ethics, organizational mission, quality culture, and proactive risk management in quality practices.   Additionally, ISO 9000, which provides definitions and quality management principles, is also under review to expand its scope with new terms and definitions.   Objectives and Participation   The ISO/TC 176/SC2/WG29 committee is responsible for leading the ISO 9001 revision process. The update aims to ensure that the standard addresses current and future quality management needs, making it easier for users to interpret and implement.   Key objectives of the update include:   ·       Reviewing the validity and applicability of existing requirements.   ·       Evaluating the impact of emerging trends and technologies.   ·       Aligning with the harmonized structure (Annex SL).   ·       Addressing requests for clearer interpretation of requirements.   Those interested in contributing to the revision process can participate by contacting their National Standards Body or a liaison organization.   The decision to initiate a revision was made in August 2023, motivated by the complexities of the global economic and political landscape, as well as technological advancements.   Regards, Keshav Ram Singhal

ISO 9001:2015 QMS Standard in Brief   Clause One, the Scope—a standard map to lead, For every organization, no matter the creed. Requirements are flexible, built for all, To boost quality in organizations, whether big or small.   Clause Two brings Normative Reference notes, ISO 9000:2015 vocabulary, fundamentals in its quotes. Definitions to guide the standard with clarity true, So all we understand what we need to do.   Clause Three deals with Terms and Definitions with care, It references ISO 9000, precise and fair. Each term and definition in ISO 9000, laid out right, To keep our understanding clear and bright.   Clause Four, Organization Context, broad and wide, Interested parties' expectations the standard won’t let slide. Scope and processes we must determine and define, To align organization's QMS with business design.   Clause Five, Leadership, leads the way, Top management’s active role here to stay. Roles, guidance, and values that they share, The team of the organization remains inspired and prepared.   Clause Six, Planning, addresses risks and targets, Objectives and changes are planned well to get. Risk-based thinking strengthens the foundation, To foster success, growth, and innovation.   Clause Seven, Support, for all we need, Resources, skills, to help succeed. From documents to system knowledge shared, A solid quality management system, well prepared.   Clause Eight, Operation, brings it alive, Design and production, in which we thrive. Services or products delivered, outputs controlled, Standards we met and many processes rolled.   Clause Nine, Performance evaluation checks all the way, Data analysis, internal audits, and management review say. To measure, to analyze, to see what’s best and true, So, our systems stay strong, achieve all goals in view.   Clause Ten, Improvement, a call to always rise, Nonconformity and corrective action, learning wise. Continual improvement and growth, in steps we tread, Quality’s journey progress, always QMS remains ahead.   Annex A  informative adds a guiding light, Concepts and terms clarified to sight. Annex B informative provides other standards near, Thus, ISO makes the broader quality sphere.   At the end, a Bibliography is given, wise and deep, To reference the Quality that we sow and reap. ISO 9001:2015 QMS standard, in harmony rings, A popular QMS standard for excellence ISO brings.   - Keshav Ram Singhal