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Finance

FCA Consumer Duty: what should digital leaders prioritise

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By Kristina Leach, director, Global FSI Insights

 

Putting customers first makes sense. It delivers positive outcomes for both financial organisations and customers, driving trust and loyalty. However, as much as a customer-centric mindset makes sense, it isn’t something that’s been enforced – until now.

In August 2023, the Financial Conduct Authority (FCA) Consumer Duty rules come into effect. Designed to fundamentally improve how the financial sector serves retail customers, the Duty sets “higher and clearer standards of consumer protection” and stipulates that customers’ needs are put first.

While the Duty has been created mainly to protect customers from being misled or making poor financial decisions without being given all the appropriate information, there  are additional considerations to take on board as well. To comply with the new rules, financial institutions (FIs) must review and potentially enhance their products and services to optimise each customer experience (CX). This is not a choice, and FIs will need to be able to prove that they’ve done it and continue to do it. With more and more financial interactions taking place online, the digital arena will be massively impacted, but compliance should be viewed as an opportunity.

There are a handful of areas FIs can focus on, from journey analytics and building a cross-channel understanding of customer behaviour to providing evidence of compliance via session replay. The Duty requires FIs to consider the needs, characteristics and objectives of consumers – including vulnerable ones – and how they behave at every stage of the customer journey.

Customer experience visibility

For firms to comply with the Duty (and remain competitive), digital experiences can’t be “unclear or confusing” (rule 9.18), meaning optimising CX is crucial. That’s where journey analytics comes into play, allowing FIs to monitor and review customers’ online experiences and understand how smooth (or not) their interactions are.

Journey analytics is a data-driven approach that tracks page actions, errors, frustrations and behaviours, allowing firms to retrace customers’ journeys and truly empathise with them. By pinpointing the moment they’re derailed, it’s possible to identify friction points and usability issues and fix them accordingly.

Collecting voice of the customer (VoC) feedback is another way to track and respond to customers’ concerns. But VoC alone doesn’t indicate the size and scale of a problem. For a more comprehensive understanding, one-click quantification is a powerful way to augment VoC. With a single tap, it’s possible to see how many customers have experienced the same issue and measure the overall effect on revenue. That helps FIs prioritise fixes by focusing on the most significantly impacted areas, be it rage clicks, JavaScript errors or slow API calls.

Visibility into the customer experience is also achieved via real-time behavioural KPI alerting and friction monitoring, enabling organisations to react quickly when customer frustration arises. Real-time rescue is a handy tool to employ here. Depending on the situation, firms may send personalised offers, a survey to understand the problem better, email updates on enhancements, or prompts to join a chat.

Building an omnichannel understanding of customer behaviour

These days, many financial services customers use multiple channels to interact with their providers. They may start a process online and then call the contact centre to complete it, particularly if they face friction. According to our retail banking survey, 52% of UK respondents prefer leveraging several channels.

To ensure digital journeys aren’t “unclear or confusing”, FIs should use behavioural analytics to evaluate customer interactions across channels, helping them understand how people act and why, enabling accurate predictions about their future behaviour.

By better understanding what people want from products and services, firms can create a more seamless and personalised CX, reducing churn and increasing customer lifetime value. FIs should factor contact centres in, too. By arming customer support employees with real-time visibility into the digital experiences people are having, they can serve customers quicker and more efficiently. For example, if an individual rings in with a problem, finding a resolution is much easier if the agent has session replay tools at their disposal. That way, they can see exactly where the person had an issue (and why).

Providing evidence of compliance with session replay

Alongside striving to deliver good customer outcomes, FIs also need to prove they’re being met should it be questioned. This means demonstrating that the appropriate information was collected from and provided to customers, enabling them to make informed decisions. But how can this be done across thousands of digital encounters each week?

Enter, Session Replay. For guaranteed compliance, FIs will need to capture 100% of user sessions and have them on hand when required. Long-term storage of session replays will therefore become critical, as will linking session replays directly to contact centre calls, giving regulators in-depth accounts of actions firms took.

This data-driven approach provides a wealth of customer insights that can improve CX and help protect the customer, while ensuring FCA compliance is built in from the outset.

Driving better relationships with the Consumer Duty

Satisfying the new rules is no small task. But by optimising CX, delivering real-time support, and bridging the gap between online and phone channels, firms are well on the way to regulatory compliance and becoming truly customer-centric – win-win.

Business

Accounting Automation in the Future

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Accounting automation is the process of streamlining repetitive tasks in financial processes. For example, some processes like invoicing are time-consuming and repetitive. Automation can reduce manual labor and save businesses both time and money. Also, it helps improve accuracy, reduces errors, and provides more accurate financial reporting.

Accounting automation in the future will be increasingly important for businesses to stay competitive. But every new change comes with both advantages and challenges. Let’s dive in to get ready for this future trend.

 

Potential Future Benefits of Accounting Automation

Increased Efficiency and Cost Savings

Accounting automation is a great way to increase efficiency and cost savings. For example, AI bookkeeping uses advanced algorithms to automate many accounting tasks. So, companies can track expenses, prepare financial reports, and more using AI.

It reduces the time needed for manual entry. So, businesses can spend fewer labor hours on tedious processes. They can increase efficiency by freeing up resources for more strategic work. It also helps reduce errors and inconsistencies associated with manual processes. So, the cost of compliance is lower because of greater accuracy.

 

Improved Accuracy and Reliability

Accounting automation can improve accuracy and reliability in accounting processes. For example, Automating bank reconciliation is less prone to errors from human mistakes or miscalculations. You can automate the process to identify discrepancies between the bank statement and accounting records. It helps to ensure that financial reports remain accurate and reliable. So businesses can take corrective action faster than processing data manually.

 

Streamlined Business Processes

Streamlined business processes involve eliminating unnecessary steps, reducing paperwork, and automating repetitive tasks. This allows businesses to focus on higher-value activities, such as developing new products, improving customer service, and developing strategic plans for the future.

 

Making a Better Decision

Accounting automation can enhance decision-making in 3 ways.

1. It enables businesses to access real-time information from multiple systems. So they can identify trends for better decision-making.
2. Automated accounting also helps with forecasting, budgeting, and auditing tasks. It enables businesses to be more proactive in their decision-making processes.
3. Also, automated accounting tools can integrate with enterprise resource planning (ERP) systems. They can manage data across the enterprise and make concise decisions that are favorable to the company as a whole.

 

Increase Customer Satisfaction

Accounting automation can help businesses increase customer satisfaction by streamlining their processes and providing a more efficient customer experience. For example:
4. Automated accounting systems can automate tedious manual tasks such as invoicing, data entry, and payroll processing. This allows businesses to focus on other aspects of their operations that are more important for customer service.
5. Automated accounting systems can also provide customers with more accurate and timely financial information. The information can help them make better decisions about their finances.
6. Also, accounting automation enables businesses to respond quickly to customer inquiries. It helps reduce wait times and improve the overall customer experience. So, you can build better relationships with their customers.

 

Improved Accessibility

Accounting automation takes place online or comes with cloud-based solutions. So, you can access your information and do your job from anywhere instead of being confined to one spot.

 

Challenges to Implementing Accounting Automation in the Future

Cost of Technology Infrastructure Upgrades

Automating an accounting system often requires businesses to invest in new hardware and software, such as servers and other associated equipment. These upgrades come with a hefty price tag that may be difficult for small businesses to afford.

There are also extra costs, such as installation fees, setup charges, software licensing fees, cloud storage costs, and maintenance fees.

 

Training Requirements for Staff Members

Accounting automation involves using advanced technology to automate certain processes. So, it creates a need for trained staff members who can handle the new technology. Training requirements vary depending on the type of software used.

Some common training includes record-keeping procedures, software applications, and troubleshooting skills.

 

Regulatory Compliance Issues

Accounting automation can be a time-saver, but it also requires firms to be aware of the applicable rules and regulations. Companies must ensure that their automated systems are compliant with relevant laws and regulations such as Generally Accepted Accounting Principles (GAAP), International Financial Reporting Standards (IFRS), and other applicable accounting standards.

Besides, they must also comply with legal requirements related to taxes, financial statements, and other reporting obligations.

So, businesses must consider the complexities of regulatory compliance when automating accounting.

 

Security and Data Protection Concerns

As businesses move their accounting processes to the cloud, they are exposed to a wide range of potential security risks. Data breaches can cause significant damage to the business’s financial and reputational integrity. Besides, the complexity of automated accounting systems can make it difficult to identify and detect suspicious activities or errors in the system.

To ensure data is kept secure, businesses must have strong measures in place to protect against unauthorized access, encryption, and regular backups of data.

Furthermore, companies must train their staff on the proper use of the system. It helps staff to know how to protect confidential information from being accessed or misused by unauthorized personnel.

Businesses may also need an experienced IT team to monitor and maintain the system to keep up with any changes or updates for optimal performance.

 

Final thoughts

Accounting automation has come a long way in the past few decades. It is likely to continue to advance in the future. As technology continues to evolve, more businesses will likely begin taking advantage of automation in their accounting processes. So, businesses should be aware of the potential challenges and prepare to stay competitive.

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Finance

Weathering the economic storm in 2023

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By

Nikki Dawson, Head of EMEA Marketing at Highspot

 

New year, new business challenges. When it comes to creating and converting leads into sales for a business, both the marketing and sales teams are critical. Both functions think differently but are equally important in driving growth and revenue. Now more than ever in the current economic climate alignment between the two to achieve business goals is vital to survival.

Entering 2023 it’s important we look back and pinpoint where there’s room for improvement within our business and between our teams. With this, I predict the majority of businesses will realise it’s now critical to get their teams to communicate, collaborate and align more effectively.

What we learned in 2022

Findings from a recent survey of sales and marketing professionals found that over half (52%) of sales and marketing leaders in the UK agree they don’t understand which marketing assets are driving results with potential prospects. For marketers, this lack of visibility over assets limited the amount of valuable oversight which would allow them to improve content and increase adoption.

As a result, we’re now left with over a quarter (29%) of marketers not feeling confident in their ability to demonstrate the ROI achieved by marketing initiatives. Due to this, 30% of those surveyed this year feel a lack of confidence in creating marketing assets that have demonstrable success at meeting specific business objectives and driving sales growth.

Equipping teams with the right tools and technology they need to achieve business objectives seems obvious, but the latest research reveals that over a third (34%) of marketers aren’t confident they have the tools they need to manage and maximise digital marketing initiatives. Furthermore, 30% of UK marketers believe that a lack of efficient technology and tools and inconsistent use of CRM (31%) are barriers to their company’s sales and marketing collaboration.

These are all crucial learnings for what marketers have identified as key barriers in their role, it’s now down to business leaders to listen and take action.

How was revenue impacted?

The lack of alignment between marketing and sales, and the limited visibility over how digital marketing initiatives performed in 2022 had a negative impact on businesses’ ROI. This, as well as not having a single source of truth for marketers and salespeople led to content chaos and became a pain point for both parties wanting to do their jobs effectively.

For business leaders, during a time when demonstrating and justifying marketing and sales spending is needed now more than ever, the gap between marketing content, salespeople and ROI is of great concern.

The year ahead

Misalignment between sales and marketing means, at best, energy and resources are being wasted. At worst, it leads to strategies directly contradicting each other and not being delivered, while team members get frustrated and potentially leave.

Sales enablement has proven that it can dramatically resolve these pain points and be the foundation for alignment. With 72% of both teams equally agreeing that implementing sales enablement to support sales and marketing is something they believe their company should consider in the near future. It’s safe to say that in 2023 may well be the year we see it come into the mainstream.

By design, sales enablement software bridges the gap to provide a platform for alignment, offering one source of truth for linking sales and marketing activity to revenue. This year, the research found that the vast majority, (71%) of sales and marketing professionals agree that a lack of alignment between their teams has had a negative impact on revenue, and 52% of sales and marketing leaders in the UK agree they don’t understand which assets are driving results with potential prospects.

It’s clear that the need for aligned business functions has never been greater and soon, marketers and salespeople will call for AI-powered sales enablement as an essential tool to do their job effectively.

Now is the time…

If businesses want to optimise their work and maximise profits in the turbulent economic climate, they need to focus on driving change from the front by aligning their sales and marketing teams. Smart investment decisions that adapt processes based on buyer engagement with marketing content, and seller activities will be crucial in the coming months.

Having a sales enablement process in place can provide the necessary framework to begin coherently organising, finding, sharing, customising, and analysing content. Sales enablement platforms can be a one-stop shop for sales processes and marketing insights and it’s no longer something that can be overlooked by businesses.

Final thoughts

The need for optimisation has never been greater. In order to maximise profits sales and marketing functions need to work together seamlessly. This year we can expect to see more businesses utilising sales enablement technology to achieve key milestones. With this, marketers and salespeople alike will recognise sales enablement as a crucial day to day tool that is just as essential as the CRM they’re using today.

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