Step Up to Enterprise Relationship Management
Financial services organizations are not unique in their need to effectively manage customer relationships. Business leaders in all industries recognize the need to improve overall customer satisfaction to reduce the likelihood of customer defection and to sell more deeply into the customer relationship. To do so, companies must fully utilize all available modes of communication - Web, email, chat, video, and voice - to serve and support their customers.
Even in our increasingly complicated world where new information channels are constantly being devised, companies must do the same things they have always done to be successful: get customers, keep them, and manage costs. Getting customers and keeping them is a direct reflection of customers' satisfaction with the products and service they receive. Yet delivering high-quality service, cost-effectively, is an ever-growing challenge.
Customer satisfaction seems so simple on the surface. An individual or company likes your product or service enough to buy it. Once they purchase, they have questions about how it works, why it doesn't work, or how to buy the next product or service they need. They contact your company for answers. If they have good experiences in their interactions with your company, they will remain your customers. If they don't, they will become someone else's customer.
The proof point of customer satisfaction is the customer's ability to find the information he or she wants - when they want it. Getting an answer to a question is the reason they contacted your company in the first place. The direct cost of this activity is in the labor required to research and find the appropriate solution. But there can be an indirect cost to the organization as well - if the customer is not satisfied with the response or the amount of time it takes to get it. Transferring customer calls or requiring customers to make repeated calls to get a solution to their problem erodes satisfaction, introduces attrition risk, and increases costs.
Getting Ahead of the Game
What makes financial services organizations unique is the lead they have on companies in other industries in implementing complete Customer Relationship Management (CRM) systems. Over the past few years, financial services organizations have implemented many technologies to support their customer service efforts:
o Customer Information Systems (CIS) that store customer information by product and by household
o Call Tracking Systems (CTS) that manage service incidents and present basic customer information to call center agents
o Sales Force Automation (SFA) systems that help sales staff target new prospects and additional sales opportunities with existing customers
Financial services organizations are also providing their customers with greater access to service than ever before. Nearly all offer 24-hour phone service, ATMs are everywhere, and banks have positioned their branches as "sales centers" to improve sales effectiveness and counteract customer attrition.
Recognizing that customers want even greater access to information and more control over their relationship with their bank, many organizations have moved aggressively to create robust Internet channel offerings. Web-based offerings - including product information and online banking services - have multiplied rapidly over the last five years. The May 2000 issue of Online Banking Report reports a 3,000% increase in the number of financial institutions worldwide offering Web-based banking services. Their customers are responding: the total number of Web banking users in the U.S. has increased 1,400% over the same period of time.
The Internet Is a Mixed Blessing
The explosion in Internet banking activity has been a mixed blessing. Opening the Internet channel has certainly provided customers with greater opportunities for self-service. At the same time, however, it has served to further increase customers' expectations of the organization and the complexity of service delivery.
A financial company's website can give the impression that the company functions as a single organization with a variety of product offerings. In fact, the products and services offered are typically provided through multiple organizations that function independently of one another. To the customer, all areas - consumer, commercial and mortgage loans, brokerage services, insurance services, credit cards, trust services, treasury management services, leasing, mutual funds, annuities, checking and savings accounts - look to be part of a single organization. Why wouldn't they expect to get an answer about any of these products from a single source?
Compounding the problem, the products and services provided by each of these functional areas are often very complex. Expecting any single customer service organization to adequately support all of these products can be too much to ask. The typical solution has been to create service organizations within each functional area, with their own technical infrastructure and customer service strategies. This structure is not, however, conducive to improving the perception of overall customer service, creating value-added loyalty, or reducing customer attrition. It's also very expensive.
Figure 1 - Trends in Online Banking
Life Used to Be So Simple
The Internet "fad" has turned out to be a way of life. The speed at which new technologies are introduced continues to increase exponentially. As customers migrate from simple channels (telephone) to complex channels (Internet), the service challenge is heightened by the organization's need to manage the increasing complexity of the questions posed as a result of the channel.
Every customer has a basic understanding of the telephone. The Internet can be intimidating. LANs, WANs, routers, hubs, modems, broadband connectivity, ISPs, and software compatibility are more than the average user can understand. Customers are now asking your call center staff questions like "What are the system requirements to download my account activity into my PFM software?" and "How can I get my account information using WAP with my PDA?" These in addition to "What's my balance?" and "Which checks have cleared my account?" are the questions your customer service staff has to answer correctly every time in order to add value and keep your customers.
This is easy for technology companies. The products they sell are embedded in the questions they need to answer. That is not the case for financial services organizations. They are now required to understand not only the products they sell, but also the technology products providing the access for their customers.
The Answer is the Answer
Planning for the future of CRM and its tactical deployment in financial services organizations requires a clear understanding of which components exist and which must be added to achieve an outstanding level of customer satisfaction.
Receiving questions from customers about your products and services is relatively easy. Creating and managing the channels they use to access your organization has been accomplished. Most organizations have opened up all of the channels discussed earlier. The Internet and email have gained equal importance with the telephone as methods for disseminating information. The customer selects the channel that is most convenient for them. The channel enables the answer.
Finding the answers to customers' questions quickly and accurately is the new frontier. The answer is the service differentiator. The answer is everything. The cornerstone of CRM in the future is managing the "smart" stuff. The smart stuff is the internal knowledge required to answer increasingly complex questions from customers who reside in many different parts of the organization. Adding that piece of the puzzle will move the organization rapidly down the path to a full CRM strategy.
