This page has not been updated recently.
We have kept it, within the OnWindows Archive, for your reference.

Financial services


Banking: customer knowledge

The marriage between financial institutions and their customers can hit the rocks fast if banks don’t pay attention to detail; Jacqui Griffiths finds out how they can ensure a long-lasting relationship.

Customers – who’d have them? Well, any business wants as many as possible. But customers can be tricky to deal with – how can you know what they want? Do they know what they want? And if they do know, are their decisions based on the best information?

In the financial services industry, attracting and retaining customers is of paramount importance, and knowledge of a customer’s needs lies at the root of outstanding customer service. But successful sales are not the only issue – in this industry, a lack of customer knowledge can lead to trouble in the form of litigation and fines for mis-selling or non-compliance. And once issues like these enter your customer’s field of vision, trust and reputation, as well as the customer, make ready to exit.

It stands to reason, then, that the firms that are most successful in managing customer relationships prioritise customer knowledge. When staff understand customers’ perspectives and priorities, they can improve the customer experience and deliver high quality, personalised sales and services.

Many organisations have worked hard to satisfy changing customer demands by adding channels such as the Internet or mobile banking as they have emerged. But this, along with the disparate technologies that result from merger and acquisition activity, has left many with disjointed IT systems. And when channels and systems are disjointed, cracks can appear in the customer relationship.

“Market forces such as mergers, globalisation, increased competition and new regulatory requirements are radically altering the financial services business,” says Rachel Clinton, country manager at SPSS. “To prosper through this turbulence, firms must be able to align themselves around their most valuable asset – their customers. Financial advisors need to make the shift from product portfolio management to customer portfolios, using analytics to focus on the financial needs of unique customer segments while balancing opportunities with risks.”

In order to improve the customer experience, then, financial firms must address the needs of their staff. “Customer knowledge is about helping financial advisors to be more productive,” says Vivek Thomas, managing director for EMEA at Maximizer. “Banks want to use knowledge management to leverage the workforce they already have. They know that if they can automate some of their processes then it provides more time to be proactive with customers.”

The relationship between a bank and its customers is intricate – sensitive information is shared, and customers need to feel that their point of contact at a financial services firm cares enough to remember these details. “If they don’t, it’s like going on a dozen dates with somebody and they still ask you what food you like,” says Thomas.

Of course, with so many customers as well as a full staff of advisors, a bank needs help to ‘remember’ all of an individual customer’s information – and that comes down to technology. “Providing the right information for frontline staff to make the correct decision drives efficiency,” says Thomas. “Technology provides that continuity, as well as speed to market.”

“It’s important to remember that data only becomes useful when it is actionable,” agrees Clinton. “It is now possible to analyse data from every channel – including ATM transactions, Web data and even textual data, like notes from call centres and branches to provide a more complete view of the customer.

Tactically, predictive analytics identifies precisely who to target, how to reach them, when to make contact, and what messages should be communicated. Crucially, predictive analytics connects data to effective action by drawing reliable conclusions about current conditions and future events. Without the benefit of technology, data from different channels and departments tends to get stuck in silos and the view of the customer is fragmented.”

Tony Moore, account director for financial services at Touchstone Group, agrees: “Only by using technology in the correct way can organisations achieve a correct view of their customer. It is also possible by careful analysis to interpret potential need and maintain optimum customer return. Technology allows a single view of the customer, so you can cross-sell and up-sell relevant products and services based on knowledge of what other products or services they currently buy from you.”

However, one thing customers are notoriously touchy about is being given the hard sell. There’s a thin line between being offered the right product at the right time and having extra purchases foisted on you. On one side of that line, customers feel as if the bank is interested in their welfare, while on the other, it’s the bank’s welfare that is central to the relationship.

Customer knowledge technologies can help to avoid this by enabling staff to finely tune their approach. “Cross-selling and up-selling must be viewed as an opportunity to inform a customer of a service or product likely to be of genuine benefit to them, rather than an opportunity to push something the company would like to sell more of,” says Clinton. “For this reason, customer knowledge should be the basis of any cross-sell or up-sell campaign. Solutions such as campaign management, predictive analytics and enterprise feedback management are helping to make inappropriate or unwelcome cross-selling and up-selling a thing of the past.”

“A truly effective customer relationship management (CRM) solution gives all people in the organisation that have contact with customers a single view of each interaction,” adds Moore. “Staff can then tailor their discussion to the needs of a particular customer, and be prompted to offer the right product or advice at the right time. Numerous studies prove that organisations that achieve this have the highest customer retention rates with the most satisfied clients. If all customer ‘touch points’ are visible, where appropriate, these processes will appear seamless to the most important person – the customer.”

“The correct technology choice gives you this ability to see an aggregated view of all processes and customer information that you have stored across the business,” says Murray Macdonald, business development manager at K2. “This is why it is so important to choose a technology framework like Microsoft .NET, and enterprise workflow software like K2 that sits across your business and can deliver this holistic view throughout the organisation.”

“Instead of using a business intelligence for a single application, firms are now building broad capabilities for enterprise-level business analytics and intelligence,” adds Clinton. “This enterprise-wide approach goes beyond data and technology to address the processes, skills and cultures of organisations. Successful strategies are driven by senior executives who insist on fact-based decisions.”

While the customer enjoys his or her one-to-one relationship with the financial institution, efficient CRM technology can factor in information about them from other organisations. “A truly modern CRM solution, like Microsoft Dynamics CRM, should capture all important customer information,” adds Moore. “If this information is available, correct and consistent customer interaction can be achieved.”

“Advisors can now really know their existing and potential customers through their data, instead of just guessing or relying on gut instinct,” says Clinton. “One of the most exciting developments has to be the ability to include attitudinal data in the analysis, so that advisors can understand not only how a customer has behaved or is likely to behave, but also why.”

Seamless channel integration is a goal worth pursuing, but for Clinton, it takes continued effort. “When analytic technologies are accepted and applied in this way throughout the organisation, the gaps between different departments begins to close and true customer lifecycle management is possible. However, the best advice is to start small. Complete seamless integration across channels is a long-term goal and not yet a widespread reality.”

Given the progress already made, though, firms are optimistic about the future. “Having a complete view of the customer will become the norm,” says Moore. “Not only does it help organisations to comply with regulation, but it also helps you target the right customer with the right product at the right time, from a single point of contact. Companies that get this right will be the ones that win out.”

“I’d like to see more mobile applications to help with the customer service experience, so advisors can collect information where the customer is most comfortable,” says Thomas. “I’m happier talking to a financial advisor over a cup of coffee, at home, with my spouse. Although security has to be carefully implemented, serving applications to a Windows mobile device opens up doors for the future.”

In an increasingly regulated industry, good customer knowledge technology will also help to smooth any cracks in compliance. “Customer profiling can help with compliance,” Thomas adds. “For example, you can create a workflow that pops up an alert to ask an advisor to check certain facts with a client before proposing a product. It can also produce a mandatory field to make sure that certain information is recorded.”

“The challenge is making sure that the correct processes are always being followed,” says Macdonald. “Compliance and best practices processes can be best enforced through workflow software. Not only are processes followed, you also get to view progress as it happens and get a complete audit log once they’re completed. By enforcing processes with workflow software, you are reducing risk to the business and improving customer service.”

Rising to these challenges, concludes Clinton, means a shift into real-time analytics: “Forensic analysis is useful, but when an advisor is speaking to a customer on the phone for instance, they need information at their fingertips to make the right recommendations. For example, for debt management, real-time analytics would let an advisor review a complete customer history while interacting with that customer. Transactional information, text captured during a call centre discussion, attitudinal data captured in a branch, e-mail or Web survey, will all help advisors to offer the right advice.”

This feature was originally published in the Winter 2007 issue of Finance on Windows magazine





Please login/register to add your comments

Review comments:

There are currently no comments on this article



Prime focuses on Microsoft technology in manufacturing, exploring issues from PLM and the supply chain, to plant floor visibility and lean manufacturing.


Finance on Windows is Microsoft’s quarterly enterprise customer magazine for the financial services sector, covering banking, capital markets and insurance.


Speak provides a quarterly digest of news, features and case studies focusing on challenges faced by retail, hospitality and consumer-focused businesses.


Touch is the latest addition to the suite of Microsoft industry publications and the new authority on public sector activity within the EMEA region.

Financial Services Global Outlook 2012-2015

The Financial Services Global Outlook 2012-2015 is an essential resource for those looking to identify solution providers in banking, insurance and capital markets.

Prime Partner Guide 2010/11

The Manufacturing & Resources Global Outlook 2012-2015 is a leading authority on Windows-based solution providers in the manufacturing and resources sectors.

Distribution and Services Global Outlook

The Distribution and Services Global Outlook is a yearly publication that profiles Microsoft technology partners in the retail, consumer goods and services industries.

Public Sector Global Outlook

The annual Public Sector Global Outlook is an invaluable resource for companies in the sector seeking to leverage their investment in Microsoft solutions.

Communications Sector Partner Guide EMEA 2010

The Communications Sector Partner Guide is Microsoft’s official printed directory of partners serving the EMEA communications sector.

Keep up with OnWindows


To find out more about advertisement opportunities online and in our suite of Microsoft industry magazines visit the Partner Zone