How’s your relationship?

For financial services providers, maintaining good relations with consumers is no longer a fringe concern. If you don’t keep your customers happy, your competitors will be only too keen to step in. FST spoke with KANA Software’s Lindsay McEwan, Gagan Bhatnagar of Capgemini, Avaya’s Gordon Loader and Danny Singer of Noetica about this increasingly vital front in the battle for market share.

FST. There seems to be a growing focus on the customer experience in financial services. What do you think is driving this?
LM. The competitive need for providers to differentiate themselves, and growing customer demand and expectations for excellent customer service are major factors. Online channels are growing and consumers have become more sophisticated in their ability to interact with businesses. When consumers see similar products on offer from providers on the high street, as well as online, customer service becomes a significant way of differentiating comparable financial service products.

The financial services sector is waking up to this fact and to the importance of gaining consumer trust and maintaining customer loyalty. A recent Forrester study showed that European consumers are 40 percent more likely to consider their main bank for their next financial purchase if they perceive the bank to be working in the customer’s best interest. There is no place anymore for the old arrogance that permeated certain parts of the industry. Faced with increased competition and customer expectations, financial services companies have come to realise that they must match the high levels of customer service already provided in most retail sectors. KANA believes that customer service is now the key to customer retention and profit, even more so than any other activities that may have had prominence in the past, such as marketing.

GB. Financial services providers are increasingly being forced to evaluate their business models and value propositions due to increasing competition from existing providers and new entrants. Leading providers increasingly recognise that by focusing on the customer experience they are able to increase efficiency, resist commoditisation and deliver greater shareholder value and increased customer value at the same time.

As customers find increasingly little to choose between retail financial services providers, their loyalty is even more influenced by their experience as a customer. The importance of securing customer loyalty is further emphasised by recent regulatory reforms that have made it easier for customers to switch providers.

At the same time, customers are becoming ever more demanding in their expectations from financial services providers. Their perception of what constitutes good customer service has been raised by their experience with non-financial services firms, particularly in the retail industry, who have brought their successful approach to customer service to financial services. Examples of this trend include John Lewis, Marks & Spencer and Virgin.

In essence, it is the desire for increased customer loyalty in a fast-changing and highly competitive industry that is driving financial services organisations to focus on customer experience.

GL. We’ve been in the business of creating and delivering superior customer experience for many years. Since the telephone became the medium of choice to enable remote customers to contact businesses more easily, technology solutions such as Automatic Call Distribution (ACD) have provided the rich applications environment to necessary to get the right call, to the right place at the right time.

The last few years have seen an explosion in the availability and adoption of new communications media and devices. The use of e-mail, SMS, instant messaging and the like are now commonplace activities. Unlike previous technology adoption cycles, the primary driver behind this uptake has been the consumer.

This has put businesses on the back foot, as they generally don’t possess a technology platform that can handle these new forms of communication in the integrated, structured and predictable manner that’s so essential to providing best in class customer experience.

Until businesses deploy flexible Unified Communications infrastructures they’ll be plagued with the “I’m calling about the text message I sent, as a follow up to the email I sent…” type of customer interaction which is not the type of experience that will generate a long-term customer relationship.

DS. Customer promiscuity is a growing trend. Customers do not feel that loyalty is rewarded in any way and therefore tend to move from one financial services institution to another with increasing ease and almost no pain. Therefore the competitive battleground in this market has shifted to quality of service or at least the perception of quality. This is driven primarily by the customer experience at the point of contact, such as on the phone, the Internet or face to face.

FST. Obviously financial services firms are keen to link better customer satisfaction to increased sales to existing customers. How can they intelligently utilise technology to support these goals? Is there low-hanging fruit in this area?
GB. For many years, financial services providers have operated through a single distribution channel – the branch network – where customer satisfaction was created and maintained through personal relationships and face-to-face contact. However, with the introduction of new technologies and new channels through which to distribute their products, the traditional relationship that a customer had with their branch has slowly been eroded. This has also coincided with greater customer dissatisfaction. Financial service providers’ are focusing on reducing the cost of servicing while customers’ have become more sensitive to price leading to the emergence of the era of the ‘transient customer’.

Technology is a key enabler for organisations to better understand the behaviour and transaction patterns of their customers and their changing financial needs. Sophisticated data modelling and new sales models are allowing providers to position and sell additional products and services at the greatest point of need.

There are immediate steps that can be taken to secure quick wins, although these should form part of an integrated customer and channel strategy that includes introducing product bundling rules engines. These engines provide automated best pricing and bundle product configurators to create a unique offering for each customer within an approved risk envelope.

GL. Financial Services firms are in a great position to leverage their relationship with their customers to increase sales. But this has to be done in a way that works for the customer and strengthens the relationship, otherwise alienation will lead to defection.

Marketing vocabulary used to be full of prescriptive terms which lead marketers to create campaigns designed to ‘do’ something to the customer. More and more companies are moving towards the creation and nurturing of ongoing dialogues with their customers to sustain the relationship.

For too long the reason for a business to call a customer has been largely for the benefit of the company - prescriptive communication – doing such things as debt collection or lead generation. I think the next few years will show a massive deployment of technologies designed to contact customers for a reason, providing a solid basis for building an ongoing business relationship. For example, a customer would welcome a call to remind them that their house insurance was in need of renewal. The call would present a good opportunity up sell or cross sell.

As well as contact using live agents, companies will begin to deploy more technologies that provide automatic updates and alerts to customers, notifying them of events and transactions, especially time-critical one. For example, notifying a customer that they are about to go overdrawn gives the customer time to move money from a savings account and avoid charges.

In effect, business process will be enabled to communicate directly with customer.

DS. The key to success in this area is ‘personalised interactions’. The main point is to offer customers the right thing at precisely the right time and within the right context. Intelligent systems are available that allow organisations to intelligently guide their agents through interactions and spot opportunities based on indicators detected during the interaction in combination with data held in back office systems. Crude cross-selling and up-selling is less effective these days. You need to be subtle and perceived to be helpful rather than pushy. If the customer’s background in conjunction with their expressed requirements indicate that they may benefit from an additional product, then such products should be pointed out and explained. Agent guidance technology is a key ingredient in this strategy.

LM. The key lies in providing the right information at the right time to serve customers better – communicating consistently across every channel.

One the one hand, service centre staff and call centre agents need to be provided with the right tools that allow them to run customer queries quickly and gain a deep insight into each individual customer. These should also be equipped with tools to guide them through the resolution process, and provide relevant up-sell or cross-sell offers.

If you’re looking for low-hanging fruit, effective self-service is one of the things that should not be overlooked. Self-service is no longer the poor relation of agent-assisted service. With the right tools, financial services businesses can empower customers to successfully resolve their own enquiries. Not only does this improve the customer experience, leading to increased customer satisfaction, but also enables significant bottom line savings. If customers are able to use web self-service options to achieve a satisfactory conclusion to queries, less pressure is placed on the organisation’s contact centre, which means that it requires fewer resources. Customers who are able to interact successfully with their bank or insurance company are also more likely to stay with one provider.

FST. Customer experience of call centres can sometimes be a source of bad press – do you think this is fair, and how can the industry change perceptions in this area?
GL. Bad service, whether from a call centre or otherwise is never going to create a winning business relationship. Having said that, call centres do seem to create an especially emotional response within consumer communities, the press and the public at large.

The business of delivering superior customer service is becoming very complicated in what’s becoming an increasingly joined up world. With the availability of product comparison websites customers are less and less likely to remain loyal to the existing financial services provider.

We’ve definitely moved on dramatically from the days when one size fitted all and the ACD-based telephone call centre was the standard way to interact with customers. We’re in a 24/7 world, where the reach of the internet and multimedia communications are pervasive. Increasingly we need to market to the level of the individual. This means that only by really understanding your customers preferences and needs can you build the right communications that will deliver the service they demand. The technologists must align closer than ever with the business to ensure success.

Another way to change the perception is to continue the focus on professional education for those both in and entering the call centre industry. The Call Centre Association has made great strides in developing best practice and methods of working that help define the operational standards for the industry.

DS. The truth is that in most cases this is a sign of increasing standards. Customers’ expectations have risen to the point that what was acceptable a few years ago is considered poor service today. In a strange way, the industry is a victim of its own success. On the other hand, some very basic improvements could change perceptions quite dramatically. For instance, limiting the use of IVR, using tools that reduce waiting times in queues and moving to smaller, distributed centres and even home agents in the place of massive ‘sweatshop’ call centres are simple ways of improving the image of the industry. And, of course, not asking you for your 16 digit personal number two seconds after you had laboriously punched it into your telephone keypad would help as well.

LM. The perception can be changed by addressing the problems that sometimes occur: lack of first-contact problem resolution, customers put on hold, escalation to second line agents, different answers depending on which channel you use or which agent you talk to. All these can be addressed by implementing multi-channel contact systems that link directly into a single knowledge base and also provide intelligent suggestions and resolutions for customers’ specific queries.

Providing alternative contact channels from the contact centre, such as email, chat and helping customers solve queries themselves by providing intelligent online problem resolution also helps alleviate pressure on contact centres. We carried out a survey of financial services organisations and found that some companies did not even answer emails. This is a poor state of affairs. If a customer’s online query has resulted in a dead-end, and the alternative is to call a poorly serviced call centre, the effect on reputation and brand can be disastrous.

The only way to change perceptions is to update contact centres and provide agents with intelligent insight into the customers that are calling them and support for multi-channel queries.

GB. As ever, the media tends to focus on the most newsworthy examples of poor customer service. But there are plenty of examples of very good call centres, many of which are part of relatively new organisations.

In order to reduce costs, some organisations did migrate to call centre based services, without having sufficient time to undertake the necessary staff training and re-engineering of processes. This adversely impacted their call centres’ quality of service and led to poor publicity, tarnishing the image of call centres in general.

Some of the bad press may be deserved, but not all. The industry can change public perception in this area by ensuring that their call centres form an integral part of a well thought-out holistic customer service strategy. This means, at the very minimum, that the call centre needs to deliver a service that is consistent with all other channels to market. Firms need to examine those organisations that operate successful call centres in order to build best practice models and to develop strategies to address staff knowledge, call processing optimisation and decision support tooling.

FST. Can you tell us a little about the solutions you offer that help financial services develop deeper longer lasting relationships?
DS. Noetica offers the best Agent Guidance technology on the market today. It combines elements of SOA and BPM to deliver a Unified (process driven) Agent Front End elegantly integrated to a variety of back office and legacy systems in a coherent context. The system allows non-technical users to create and manage the agent applications and refine them over time.

In addition, Noetica’s product family Synthesys provides extensive Computer Telephony Integration, a patented Predictive Dialler (both software and hardware based), telephone, email and SMS Outbound Campaign Management, basic CRM and workflow and service despatch technology.

Our Agent Guidance technology is key to increasing sales from existing customers, retaining these customers through efficient and effective customer service and acquiring new customers (with the help of the Outbound modules).

Synthesys is an agile tool that frees agents from the constraints of technology and allows them to really listen and communicate with customers on a human level.

GB. For over thirty years, Capgemini has been solving banking, wealth management, insurance and payments challenges for its customers in the face of a rapidly changing environment. We have worked with some of the world’s leading financial services organisations and offer a range of solutions that enable organisations to increase both customer value and loyalty. Capgemini’s offerings include core customer relationship management systems implementation, enabling firms to have full visibility of all customer-related activities. We also provide change management, which enables firms to introduce change rapidly and sustainably using proprietary Capgemini methods such as Hot Housing and the Accelerated Solutions Environment.

Our business analytics solutions allow firms to obtain insights into their customers, to model their behaviour patterns and to target them with the right products and services at the right price. We also develop innovative operating models and processes that provide a seamless and integrated customer experience across channels as well as providing solutions and tools that empower front line staff to recognise and meet customer needs.

LM. KANA offers multi-channel solutions that blend knowledge into the customer experience both in the contact centre as well as online. We offer highly-rated, award-winning solutions for phone-based contact centres as well as multi-channel centres that support email, Web chat, collaboration, and self-service

TD Waterhouse, for example, is using KANA IQ – a powerful knowledge management system that supports and guides contact centre agents through query resolution. TD Waterhouse implemented this system and saw customer satisfaction increase by 12 percent – it helps employees easily access the information they need while on the phone to customers and so agents can answer 90 percent of questions successfully.

On the web-self service front, we offer KANA Web-Self Service which includes an integrated self-service history that delivers instant responses online, and maintains the context of a customer’s original enquiry if escalated to another channel. This helps our customers achieve much higher resolution rates on first contact for escalated communications, and reduces resolution time.

GL. What we’ve recognised is the major changes in the availability of new technologies and consumers willingness to embrace those technologies. We also recognise that there are many more changes to come, particularly with technologies such as Session Initiation Protocol.

In the past we were known for our ability to provide feature-rich, application-specific telecommunications systems such as ACD, Interactive Voice Response, Voice Messaging and so on. We’re about 10 years into a journey that sees us converge these applications with the newer business applications enabled by the web and mobile technologies. Doing this will create an unprecedented technology environment where voice, data, video, graphics seamlessly work together and new applications can be developed.

For example, a company that has invested significant resources in web based commerce and customer care can, through Voice XML technology quickly and simply make that information available through the telephone. Great for a customer wanting to track the progress of a parcel or order cinema tickets from their car.

Helping customers migrate from traditional telephony to the world of intelligent converged applications will take many years. We understand that and especially the need for to provide real bottom line business benefit not just the latest cool technology.

About the contributors
Lindsay McEwan is KANA Software’s Country Manager for Northern Europe. He joined the company in September 2007 and is responsible for all sales in the UK and EMEA. McEwan has a strong track record in building IT integration companies. Prior to joining KANA, he was a founding member of the UK Oracle Fusion Team, where he focused on key accounts in the financial services sector.

Gagan Bhatnagar is head of Capgemini’s Financial Services Consulting practice in the UK. He has fifteen years' management consulting experience, specialising in strategy and transformation in capital markets, wealth management and retail financial services. His specialist practice area is customer experience transformation and multi-channel distribution in the financial services industry.

Gordon Loader is Senior Solutions Marketing Manager for Avaya’s Customer Service portfolio. He has spent the last 20 years in the voice and data communications industry, working in a wide variety of areas including marketing, technical design, business consultancy, finance and IT. He has been involved in the call and contact centre industry since 1990 and has a comprehensive knowledge of both the technology and end user business perspectives.

Danny Singer is Noetica’s founder and CEO and has been involved in the software industry since 1981. He is a graduate in Pure Mathematics from the Israel Institute of Technology and spent the first five years of his career developing advanced software systems for the Israeli Military Intelligence. Since 1987 he has been working in the UK first as the Head of Development and then as Technical Director at Capscan Limited. Danny has been involved in the Contact Centre industry since 1988 and is a frequent speaker and commentator on industry related subjects.