Introduction
Pacific National Bank has been known for its great business acumen. The Banking industry has been known to offer a lot of competition. Therefore there is a great need for the Bank to create a competitive advantage in the market. The Bank is looking for great ways in which it can have a strategic advantage so that it can improve on its profit margin. The company has been known to use automatic teller machines but these machines are normally provided by a separate provider. The Bank has noticed that there are many disadvantages that come from having an independent provider. Therefore to meet the needs of its customers, the bank is considering the advantages of providing the automatic teller services instead of hiring external providers for its retail segment. Most banks in the San Francisco Bay area have their own automatic tellers and this has reduced their operating costs in terms of wages and efficiency.
Pacific National Bank has also noticed that the number of customers it normally has reduced and it has linked this to the unavailability of its own ATMs. The bank has a commanding majority in the bay area due to its twenty one bank branches, by creating a personal touch to its customers, the bank seeks to increase its customer base and revenues. The advantages that may be accrued to this procedure would be great. This paper seeks to evaluate the effectiveness of the establishing ATMs owned by the bank and other ways in which the efficiency and revenues of the company may be increased. A close study will be done on the use of ATMs and their effect on the performance of a Bank. The tastes and preferences of customers will also be taken into account.
Conclusion
Automatic teller machines offer great convenience to customers everywhere. This is because they offer the customer the convenience of having banking services 24 hours a day. ATMs do not close in the weekend and therefore this gives an extra advantage to customers as not only do they access services all day and night but they also get served every day of the week. This serves to increase the customer transaction and the number of customers for Pacific National. This would lead to an increase in efficiency, and revenue for the bank. The increase in the use of credit cards owned by the bank would also lead to an increase in revenue as customers will now be able to purchase goods and services conveniently, which in turn would mean an increase in the banks' revenue.
However much there is an increase in the marginal cost of the addition of one ATM, they are outweighed by the marginal savings in costs that would have been paid out to staff and the marginal benefits that come from the increase in transactions due to a reduction in time taken when queuing for a service. This has been seen to increase the good customer relations with customers as banking is no longer a dreadful thing. The increase in customers can also be managed by increase in additional ATMs. This has also been noted to have increased the security of the employee’s services after hours are automated; it also reduces the risk of human error in the business. Therefore the installation of Automatic Teller Machines by Pacific National Bank is highly recommended. This is because of the great benefits it will bring to the company and customers both in the short and long term.
