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How banks can take ‘customer-centric’ from buzzword to reality

With so much at stake, why aren’t more banks truly customer-centric after all these years of talking about it? A new study says it calls for a shift that’s cultural as well as technological.


banking

You know the term “customer-centric” is overused in banking circles when even bank executives say they’re totally sick of it.

A new global survey confirms they’re so over it. Nearly half (48 per cent) of the 185 banking professionals polled “believe customer-centricity is an overused term,” according to a study by software maker Misys and the banking industry group Efma.

The researchers assert that many bankers find the term tiresome precisely because they realize it remains — despite years of usage — little more than just a word. Misys calls it “lip service” that still hasn’t been translated into real customer service.

The poll lends weight to this: Although today’s customers increasingly demand digital service, 87 per cent of the surveyed banks get less than 10 per cent of their sales through digital channels.

So what are banks focused on? Seventy-five per cent of those surveyed believe “banks haven’t concentrated efforts on improving customer services and remain focused on sales-specific activities.”

By focusing primarily on sales, banks risk losing customers to new digital disruptors focused on convenient, connected, customized service. As the Misys report summarizes it: “If banks are not providing a service on a par with the likes of Google, Uber or Amazon, the customer feels let down.”

There’s a new urgency to this threat; Misys cites Goldman Sachs research showing 33 per cent of millennials believe they won’t need a bank at all within five years.

With so much at stake, why aren’t most banks truly customer-centric after all these years of talking about it? Misys says technology is partly to blame.

Banks told the researchers they do want to use emerging technologies for personalized customer service, but integration is a huge roadblock. Getting core legacy systems to mesh with newer stuff like mobile or predictive analytics is proving painful.

What happens when these systems aren’t fully integrated? Various bank departments maintain disparate views of each customer. Banks can’t offer personalized service. Customers end up repeating the same requests throughout the bank service chain, usually in maddening phone calls. As Misys puts it, “this can lead to inevitable frustration.”

I can relate to that. My husband and our lawyer recently called and emailed our branch manager at Bank A repeatedly, with the deadline nearing to transfer our mortgage and line of credit to another lender. After days of frustration and panic, another branch manager finally resolved things just hours before the deadline.

The very next day, someone from Bank A called our house.

“We’d like to increase the limit on your line of credit,” she said. “When can we talk to you about that?”

She had no idea about all the annoyance her bank had just put us through. No clue that we’d just moved our line of credit to a competing bank. She was clearly working from a different page than her colleague who’d resolved our situation the day before. She had the sales call down pat. The service part? Not so much.

Which brings us back to the report. It calls for a shift that’s cultural as well as technological. It says banks should think of digital as a tool to support individual customer experience, not just a way to push sales products en masse.

It even points to Canada’s National Bank Financial as proof that “a user-based approach works.” When NBF used CRM to track its customers rather than its products, it boosted the number of products per client from 1.9 to 4.5.

I’m not sick of the term “customer-centric” yet. But my patience for banks that worry more about selling to me than serving me has finally run out.

Image courtesy of Free Digital Photos

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