Banks asked to innovate more cooperation with customers
There has been much talk about the customer experience in the service industries, especially in banking, financial services and insurance sectors. The core focus remains on the end customers and their experiences at each touch point with the respective organisations.
There has been significant progress, which includes new disruptive start-ups specifically focusing on the customer journey. However, the industry still lags behind other service-related sectors such as travel, tourism, hospitality, etc.
Considering how finance and commerce is an integral part of our daily lives, one has to ask the question, why is it in that state?
One of the reasons could be that the overall service and subsequent impact has changed very little when compared to the strides taken in other service-related industries. This undoubtedly has set expectations that banks do not meet, leading to poor experiences.
The journey towards customer improvement started with product bundling, which then quickly moved on to include the channels of engagement. However, very little has been done with regards to the journey of the staff, who are responsible for serving customers.
To put it another way, if a retailer only invested in the ambience and journey within their high-street store, but did not focus on the stockrooms, supply chain, logistics and production, would they be successful in providing a market leading experience? Logic says no.
So why then has this not happened in the banking industry. Why is it that staff remain hostage to cumbersome and highfriction platforms that in most cases appear to be designed to store data instead of focusing on how that data could be used?
Unlike customer-facing systems, users of internal systems do not have a choice of walking away. They have no option but to use what is in front of them.
To make matters worse they are most often not involved in any decisions associated to system design or procurement. Most internal systems are reviewed and judged based on the capabilities they have and data they are able to capture.
It is only rarely that a management team would change their decision based on internal user feedback. And even if it is raised the obvious questions of justifying ROI (return on investment) of increased adoption are rarely answered.
Which is surprising when looked at from the perspective of training, recruitment, operational risk, and customer experience failure risk. Poor system design is a major contributor to internal mistakes and incorrect data entry.
Banks attempt to mitigate this risk by spending more on controls which in turn increases friction within the customer journey. Banks then try to alleviate this friction by increasing efforts and cost on training, which when done half-heartedly actually ends up increasing the risks associated with staff churn and loss of tacit knowledge.
Consequently, banks go on to further tighten controls on changes to any process and procedure definitions that again increase friction in the customer journey by reducing agility and flexibility. This appears to have become the industry culture and is most often referred to as industry standards.
Which means that when new staff are recruited from competing institutions they invariably bring in the same mindset, and then mould new recruits as well.