ADDIS ABABA UNIVERSITY

COLLEGE OF BUSINESS AND ECONOMICS

DEPARTMENT OF MANAGEMENT
MASTERS SCIENCE IN MANAGEMENT
Service quality management
MGMT-TOM 5322
Case study analysis: United Commercial Bank and El Banco

Group members ID number

Hiwot Muluken GSR/1869/14
Kaleyta Gebre GSR/8279/14

Submitted to Instructor: Dr. Ethiopia Legesse

Submission date: April 30th, 2022
 UNITED COMMERCIAL BANK AND EL BANCO

1. Compare and contrast the strategic service vision of El Banco and United Commercial Bank.

Strategic Service Vision El Banco United Commercial Bank

Service Delivery System  In person service at the bank’s  Business is done at the bank.

location.  Geared toward Asian culture

 Warm and home like feeling and design.

geared towards Hispanic  Many branches in America

culture. and in Asia.

 Decor, music, and language are

Hispanic based

Operating Strategy  Offer fee-based services such  Trade financing, offer savings

as instant bank transfers, accounts and CD’s, lend

cashing third party checks, and conservatively and have low

mortgage lending. account maintenance fees.

 Franchise that existing banks

can license.

Service Concept  Tailor the bank’s environment  Provide services targeted at

to the Latino culture to help Chinese American needs that

make them feel more understand Asian Culture.

comfortable and build trust.

Target Market Segment  Hispanic community  Chinese/Asian community

1
Four pillars support the strategic service vision: target market segment, service concept,

operating strategy, and service delivery system. In essence, the pillars are used to enhance or

modify existing services. The first pillar, target market segment, is essentially the stage of

discovery. The goal of this stage is to figure out whom the company is serving and how their

product should be adapted to their needs.

Demographics, psychographics, and other essential aspects all play a role in choosing the target.

In the case of United Commercial Bank, the Chinese American community, which is concerned

with financial stability and soundness, is the clear target market. The bank's mission statement

even tries to entice customers by stating that the company's ultimate goal is to help families and

businesses achieve the American Dream. El Banco de Nuestra Communidad, on the other hand,

focuses on attracting Hispanic customers.

According to the company's CEO, Drew Edwards, everything in the bank is designed to appeal

to Hispanic customers, from the bright colors to the Spanish music and comfortable ambiance.

The second pillar of the service vision is the service concept, which focuses on why customers

would choose one product over another. East West Bancorp is one of UCB's competitors in the

Asian community. Nara Bancorp, Cathay General Bancorp, and Wilshire Bancorp are all

subsidiaries of Nara Bancorp.

As previously stated, the Chinese American community places a high value on financial stability.

To compete, the UCB tries to meet their standards by offering high-interest savings accounts and

CDs, attractive business loans for real estate transactions, features to facilitate import and export

businesses, which are popular among Asian Americans, and low and sometimes refundable bank

fees that keep customers coming back. El Banco, on the other hand, derives its revenue from

bank transaction fees.

2
The United Commercial Bank is strategically located in Chinese American neighborhoods, as

well as in Hong Kong, Taiwan, and China. UCB is able to maintain a strong flow of business and

communication with their customers by employing Chinese-speaking employees. Furthermore,

whenever a client opens a checking or savings account, they are rewarded with a tea caddy or

gift tea sets to further enhance the culture. El Banco, on the other hand, is only located in

Georgia, but they use a similar structure strategy.

They, too, are culturally homogeneous, owing to a focus on Hispanic constituents and the

employment of Spanish-speaking workers. El Banco's overall appearance is informal, and their

business structure is a franchise company, which are two significant differences in their

structure. Finally, the service delivery system is the fourth pillar. This pillar ensures that the

operating strategy is carried out. The United Commercial Bank delivers their services once again

by employing Chinese-speaking employees and emphasizing Chinese culture and beliefs.

UCB is able to compete with their competitors and fulfill their business model by providing their

clients with safe but valuable assets. El Banco also employs culture to achieve their business

objectives. The banking shows how dedicated they are to their constituents by decorating their

establishment with bright colors, Spanish music, comfortable seating, a play for children, snacks,

Spanish language newspapers, phones, and e-mail stations.

3
2. Identify the service winners, qualifiers, and service losers for El Banco and United

Commercial Bank.

El Banco United Commercial Bank

Service Qualifiers Fluent Spanish speakers on Chinese spoken at all

site, standard bank services locations. Standard bank

offered services offered

Service Winners Check cashing, money orders, Import and export services

home loans

Service Losers Fees for services, will cost very conservative lending for

customer more to do business home loans with higher rates

In order for a bank to be successful, it must meet certain criteria in order to attract customers.

These are known as service qualifiers, and they are present in both cases. United Commercial

Bank's service qualifiers include its large asset amount and safety. United Commercial Bank has

a 6.32 billion dollar asset account, which is a necessity that this bank has met because it provides

the bank with a foundation to make more transactions, as well as the ability to back up current

customers and pave the way for new ones. Another service qualification of United Commercial

Bank is the security of its savings and CD accounts. By offering high interest rates, the accounts

become more secure, and a more secure bank is a more respectable and well-liked business.

El Blanco also has a few distinct service qualifiers that place them in the bank market. One of

them is that they are extremely knowledgeable and are always available to answer customers'

questions about the bank, which is useful when their policies need to be explained. Another

4
service feature is the ability to transfer money to another country. Transferring money is the best

way for them to make a profit based on their location and the habits of the people who live there.

Service winner and loser qualities are what give a company an advantage, or disadvantage, over

others in the market. United Commercial and El Banco share the trait of personalizing their

banks to the communities in which they operate. El Blanco caters to the Hispanic community,

whereas United Commercial Bank caters to the Asian community. This can be seen as both a

service winner and a service loser because it retains and attracts customers from that culture

while also preventing customers from other cultures from entering. El Blanco, in particular,

because the passage states that "the atmosphere is set for Hispanics with Latino music and

pictures." It also changed how their company operates. Because the Asian community is larger,

United Commercial focuses more on advancing and lending to businesses, whereas El Banco

focuses on day-to-day transactions, such as charging check cashing fees and wiring money to

other locations, because the Hispanic community is less wealthy. United Commercial's unique

service winners are that they have many locations, making it easier for a new customer to find

one of their banks, and that they offer a variety of services, such as savings checking and CD's.

This wide range of options will always be appealing to potential employees. Their service losers

include the fact that the interest rates are very high, making the bank more secure; some

customers may not have the capital to open these types of accounts.

El Banco’s unique service winners are that its bank is friendlier to those customers with a low

income. However, their lack of locations, and amount of services offered to customers may harm

them when trying to gain new ones. At the end of the text, it says they are competing to try to

add these services to their list.

5
3. What are the differentiating features of banks that target ethnic communities?

According to this case study, banks that target specific ethnic communities go to great lengths to

truly understand their customers' cultural needs. It is necessary to provide each community with

people with whom they can communicate in their native language. Furthermore, providing

paperwork and services that are tailored to their specific needs goes a long way toward gaining

trust and repeat customers.

One example is United Commercial Bank, which provides specialized import and export services

to their customers. Another advantage is that El Banco does not require an account to conduct

business. This can assist people in that community in obtaining the services they require without

the requirements or hassles of a traditional bank. However, these services do come at a cost.

These two banks have the following in common:

 Products that match unique customer needs (trade finance, check cashing).

 Well-articulated cultural focus on target community (language, physical setting).

 Convenient location accessible community (ethnic population centers, places frequently

visited by community members).

6
REFERENCES

1. Bordoloi, S., Fitzsimmons, J., & Fitzsimmons, M. (2019). Service Management:

Operations, Strategy, Information Technology, 9e.