We are in the age of ‘now’, with customer demands shaping competitor landscapes, as well as entire business systems. This has never been more true than in the financial services sector – where net promoter scores stand for everything, technology is rapidly advancing customer interactions, and physical touch points (especially those on the high street) are under pressure to prove their worth.
Against this backdrop, there is a strong case to show that high quality customer service can deliver real business value in the financial and payments sector – something that has already been proven multiple times, by multiple other industries. Indeed, across a broad range of sectors, 84% of organisations that improve their customer experience have reported an increase in revenue.
In the financial services world, this point has been made clear by the challenger banks, such as app-based Monzo, Starling and Atom, which have shaken up the industry. The growth in popularity of these digital-only financial services, where customers can apply for mortgages and manage their current accounts directly from their smartphones, has often been put down to their ability to both offer a high-quality service to the always-on customer, and quickly bring new platforms and services to market.
To stay competitive, traditional financial services firms need to add value to their offerings, boost customer experience and journeys for these ‘now’ consumers, whilst still driving efficiencies. They need to, in effect, make customer service demonstrate ROI, and fast.
More than a challenge
Traditional financial services organisations have for a long time suffered from large, complex and inflexible infrastructures. These systems have been built up over many years and with numerous layers, making it hard to drive agility and competitive differentiation. For instance, Capgemini recently found that many core banking systems were originally developed in the 1970s and 1980s, making most banking system solutions over 30 years old and counting.
This, understandably, makes the digitisation of services, such as online and mobile banking, extremely difficult.
Another challenge is the fact that those within the financial services sector are under increasing pressure to implement engaging digital transformation strategies, often with limited resources. This not only puts budgets under strain, but also puts the teams required to transform the customer experience with innovative technologies under pressure – pushing some organisations to the limit.
Taking a holistic view
In many instances however, a mind-shift from treating customer services as a separate entity, to putting the customer at the heart of every operation, helps organisations to find a more practical way forward.
This is customer-centricity in its purest form and it involves taking a digital focus to improve and evolve the customer journey – enhancing every touch point and improving the end-to-end customer experience.
This approach can make the overall customer journey more holistic. But to be successful, it must be underpinned by intelligent platforms which can build a picture of how a customer is banking, what platforms they are relying on at different points in the day or month, and what products they might need help with.
A practical way forward
The reality of putting the customer at the heart of every operation requires a mind-shift. But at a processes level, it also involves a change in how internal teams work, how different departments collaborate, and how different platforms communicate.
Making operational changes like this is no mean feat and there is a new industry trend of banks embracing service providers as a way of provisioning resource effectively, getting access to new skills quickly, or freeing up internal staff.
This so called ‘as-a-service’ phenomenon has been prevalent in other industries for decades. In the retail sector, it’s a tried and tested model, with the British Retail Consortium recently finding that 70% of retailers are outsourcing an element of their operations, with warehousing and IT being the most likely functions to be outsourced. This helps them to reduce costs and optimise how their businesses are run.
The transformation from traditional resourcing, to an ‘as-a-service’ economy is well underway in the UK, with analysts expecting the XaaS market to grow 38% by 2020. For the financial sector there are clear benefits to be gained, if organisations are able to boost operational efficiencies, and provide internal staff with the time they need to evolve their current customer service offering.
BankData in Denmark is just one example of a financial organisation that is already using an as-a-service model successfully. Rather than spend precious time managing its own huge ATM network, BankData is working with a service provider to implement enhanced ATM monitoring tools, newly automated processes and services support across its entire self-service network of 11 Danish banks. This means that internal staff can focus on future-proofing the bank’s services and placing customers at the heart of every new innovation.
Even some banking services start-ups are exploring as-a-service options to improve their growth performance. For example, mobile-based Coconut, which combines banking and accounting services so that freelancers can pay/ get their bills paid easier, is partnering with a banking-as-a-service provider to run its back-end technology.
Future-focused services
Ultimately, adding value to every touch point is crucial when it comes to putting customers first, and thus gaining ROI. It is encouraging to see more financial services firms find new ways to boost their offering, with many increasingly turning to service providers to do so.
Every platform needs to add something to the journey if a customer-centric strategy is to be successful, and the ‘as-a-service’ model holds the key to striking the right balance between making a customer-centric approach successful, and efficient. Long live the ROI of customer service.
