Quality management initiatives in Hong Kong's banking industry: A longitudinal study

As an international ® nancial center, the banking industry in Hong Kong (HK) plays a signi® cant role. Because of increasingly competitive pressure from domestic and overseas banks, HK banks must tightly control cost and improve quality and e˝ ciency of operations in order to maintain pro® tability. For this purpose, quality management has emerged as an e˛ ective tool in recent years. In fact, it has been regarded as a vital strategic element for meeting the challenge of the new and intensi® ed competition in the ® nancial services industry (Knights & McCabe, 1996b, Managing Service Quality, 6, pp. 18-21). This paper reports the result of a survey on quality management initiatives in HK's banking industry between 1997 and 2000. The trend of changes in these years is analyzed and the results from HK are compared with those from British ® nancial institutions reported by Wilkinson et al. (1996, Total Quality Management, 7, pp. 67-78). The results show that HK banks have gradually adopted quality initiatives and gained signi® cant success in quality management over the past 3 years. They focused more on meeting service standard and providing prompt services while banking institutions in the UK focused more on understanding and meeting customers' needs.