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How well are your customers engaged with your organization so that you have multiple opportunities to offer/create meaningful customer experiences? Historically we depended on the branch staff, next we added other distribution channels such as advertising media including direct mail, ATM's, contact centres. online banking, mobile representatives and, most importantly, full mobile banking apps, payments, etc in your omnichannel landscape. Customers are mutli-channel users today, although certain ones are critical customer engagement pivots especially with integrated digital solutions which can be customized/personalized to one customer at a time. Consumers are engaged more than ever and they control when, where and how those events take place or which ones they activate. How engagement effective are your channel choices or are they primarily reactive? How about your competitors- traditional, digital and platform? Customers are actually being engaged for financial services by non-bank/credit union digital disintermediators!

My favourite is Amazon, a platform digital retailer cannibalizing just about every retail sector including financial services. Amazon, once you have made a search or contact initiates their continuous engagement offers through any Internet/mobile device. In this high shopping time between Thanksgiving and Christmas it is amazing how many intra-day prompts/offers you receive in your e-mails. as pop-ups and side bars or other applications- as we say in sports, it is a full bench press! You always get the sense that Amazon has something new to offer in products, services or prices. So are we financial services spectators or participants in this digital transformation? Perhaps it is time to do some customer engagement/experience research and verify where you stand as a lead, complimentary or supplementary partner with your relationships? Digital dynamics are revolutionizing business and customer preferences and your research should be continuous and be tracking trends through daily data analytics.

Pat Palmer | Thursday, November 30, 2017 | Trackbacks (0) | Permalink

For a number of years we have written about, and consulted with various clients, on building integrated distribution businesses through collaborations, partnerships and various cooperative retailing arrangements. Some large FI's have expanded their value propositions with fintechs and adding new businesses to their retail offerings and even smaller organizations such as Credit Union Atlantic have developed hundreds of reciprocal relationships in their trading area. Still we see too many financial organizations not expanding their customer experiences or engagement catalysts.

There have been multiple manufacturers like General Motors,Harley Davidson, etc that made entrances into the retail financial products marketplace plus large retailers such as Loblaw and Walmart. These are the traditional intruders now but they represent minor competitive threats compared to the monster, integrated distributors and networks, some of which have entered financial services and others, we believe, won't be far behind- Amazon, Facebook, Wayfair, Google, Linkedin, and international platforms which are bound to enter the digital,retail financial services space in many countries.

The Internet distributors have silenced the skeptics from a few years ago and this black Friday/Christmas season will again stimulate more growth for them versus those dependent on bricks and mortar investments and passive digital responses.

Digital, competitive disintermediation is a major retailing reality which deserves priority attention, energy and action- it is a case of profitable survival!



Pat Palmer | Wednesday, November 15, 2017 | Trackbacks (0) | Permalink

Is your organization truly a customer-centric one or do you have distractions that dilute your competitive impacts? Year-end is a good time to audit/review where you stand internally and externally with your customer experience (CX).

Start with assessing your vision, values and core strategies and verify that customers are what drives your business and permeates the corporate culture from the top throughout. Every strategy should have positive impacts on customer engagements and experiences. In fact evaluate the expected beneficial lift for all stakeholders in quantifiable terms/goals.

Next go to each action/program/initiative and objectively determine if progress is on track to improve CX and meet or exceed expectations. If results are disappointing undertake corrective analyses and re-introduce the program. You also want to perform internal and external research to find if there are gaps in staff beliefs,commitments and customer catalysts. At this stage, walk around unexpectedly to ask and assess first hand the customer focused atmosphere of you organization in staff and line functions. Also initiate some customer focus groups including confidential questionnaires to obtain feedback on current impressions and preferences going forward. These primary inquires will summarize synchronization of expectations or conflicts to be resolved. If you undertake this audit in an organized fashion a road map for customer experience reviews will emerge and this template can be utilized annually for comparative purposes. Customer experiences do drive profitability!

Pat Palmer | Wednesday, November 08, 2017 | Trackbacks (0) | Permalink

The current atmosphere of trade talks in North America should be a strategic warning signal to all industries including financial services. There is a good possibility that the agreement could be scraped or significantly changed with long term changes in manufacturing, agriculture, etc. When our customers are impacted so are we! We don't have a central role in the negotiations but will have to quickly adjust to the fall-out. Your strategic and business plans should be re-considered with the contingencies associated with the demise of NAFTA. There are strong protectionist elements in the negotiating atmosphere as well as other negative possibilities plus in-country controls on data and security.

Even though all of us have seen the global economy grow and benefit many developed and emerging economies, the unraveling of the operating freedoms will have diverse impacts on individual countries, industries and businesses, especially if one of the largest players no longer wants to participate according to present rules. No doubt revisions to the decades old agreement would be beneficial to bring it up to our current operating and regulatory environments. One thing is for sure, if we sit on the sidelines as spectators and do not participate directly and indirectly in the negotiating dialogues we will have no one to blame but ourselves. The public needs to hear from the key respected industry leaders from every industry.

Pat Palmer | Tuesday, October 31, 2017 | Trackbacks (0) | Permalink

TD Canada Trust is currently caught up in a media attack started by ex-employees over outsourcing work and jobs off-shore and in this case again to India. The negative thrust is that Canadians private information is in the hands of non-employees in foreign countries. Of course, outsourcing or co-sourcing strategies have been around for decades based on efficiency and economic motives in financial services and just about every other industry in the global market place. In fact, larger countries have far out-shadowed Canada and our industry, especially the USA where there is now a President trying to revert the trend even though his business empire has been a participant in the outsourcing practice in the past. So, how much does negative media and public opinions affect corporate strategies and Board governance?

Technology has created or enabled a virtual world of sourcing along with continuous efforts by many countries for free trade agreements and open borders. This is based on sound economic principles but not necessary smart political motives with some leaders.

Can a financial institution survive and prosper in a highly competitive industry with only in-sourcing everything-perhaps if you are market dominant! Collaborations, partnerships, sourcing alternatives etc all make good strategic sense if the issue is front and centre and open to external assessment. It starts in the Boardroom where policy is set in this regards and is implemented by management as deemed appropriate. From there the problems may emerge if transitions are not handled effectively in considering all stakeholder issues and impacts. To attempt to "quiet" outsourcing initiatives is asking for leaks and waves of criticism. 

Pat Palmer | Tuesday, October 24, 2017 | Trackbacks (0) | Permalink

Recently I have experienced the service response of organizations that acquired businesses that were long term product suppliers which I historically rated very high. But since the acquisitions there has been a significant deterioration in customer, quality service. I expect there should be some customer-centric postmortems so that top management understands the erosion that has taken place and initiates corrective steps to avoid a run off of profitable business.

First I will describe a scenario that is near to my heart and in which I am subjective on many fronts. In my RBC career I had the good fortune to help build the foundation contact centres which operated at high service standards in such measurements as wait times and the ability of the agents to handle requests without hand-offs, to name a few. Into the picture comes Aviva which acquires the auto and household segments of the insurance operation. Then I start to get feedback from family members and friends that the customer first culture was broken. Naturally, I was skeptical until this past week when I personally had to be involved with requesting a quote for insurance on a new condo. Contact centre calls had to be made four times; wait times were always close to an hour; agents had to check with background officers before any approvals which also took an extended wait time. In the end they had to admit that they couldn't provide the product required! A call was made to a local broker which we also deal with and in less than two hours the paper work had been done and the faxes had gone to the lawyers involved! This engagement will lead to not renewing other current business with Aviva plus the negative experience will be communicated to friends and family members.

Second, in our small rural community we were fortunate to have a privately owned cable company that provided outstanding service from the owner down to the newest recruit. Eastlink bought the company and promised continued high level service and expanded products.....until something goes wrong! The company started introducing upgrades which eventually affected the TV reception. A service call was placed to the local number which bounced to an Eastlink call centre with long wait times and a repeated message to try their Internet service. Naturally, I took the option and on the site I had to put in my postal code so they could respond properly. Their program did not recognize my postal code- one which covers over a thousand of their customers. So back to another long wait in the call centre wait line.When a technician gets on the phone he wants to try and remedy my poor reception from the their central service call centre, so I obliged. After a few minutes I had no reception the day before the Thanksgiving weekend with family members arriving. Now the wait was five days to get the "local" technician to come to the house, which he did. Service was reactivated but I was warned that there could be problems because the cable was old. Yes the reception was unsatisfactory so back to the call centre and wait a day or two for the technician to return and get it right. Fortunately in our rural area their is another option for Internet/TV/telephone.

These are personal examples which others are probably experiencing. So were are the leaders dedicated to customer service or don't they realize that service is what drives profitability or erosion thereof!

Pat Palmer | Saturday, October 21, 2017 | Trackbacks (0) | Permalink

For decades Canada has had a productivity deficit compared to other countries especially its neighbours to the south. Efforts to improve output with technology and other process efficiencies have shown some improvement but only incrementally compared to others.

The Canadian financial services industry sector is no different than the country trend. So why do we lack the ability or drive to make quantum leaps forward in productivity? Is it our leadership? Complacency and comfort? 

If each institution took a long objective look at themselves they probably would find the clues for improvement strategies. First of all, every CEO wants a upward,continuous curve of profitability. So how is this generated? Simply increasing prices/fees/rates more than costs are rising and expecting customers to be loyal and accommodate them? Or does the organization team truly identify and implement "best of breed" changes in a culture where productivity improvements are part of everyone's job? For example, in an omnichannel world which channels are more productive and how do you synchronize the trends with customers' preferences? Perhaps there are organizations that try to "buck trends" and carry on investment increases in less efficient channels! 

Having a people-productivity centric culture is got to be everyone's goal which means competing silos must be replaced with new attitudes and motivations. One of the consulting strategies we have always used is to have people isolate areas or activities which they feel are cumbersome and add little value using a matrix analysis approach for customers, staff and the bottom-line. It is always amazing listening to excuses why something can't be changed and coaching the people through to simple solutions. There are a variety of techniques that can be used to accomplish this purpose. Obviously leadership has to demonstrate its focus on productivity improvements plus a willingness to change.

Another strategy is to do a value for money audit on selected current and,yes, proposed processes, products and programs. 

In other words there is no reason why productivity improvements can't be made on a sustained basis in our industry and country. Do we have the will to do it?

Pat Palmer | Friday, October 06, 2017 | Trackbacks (0) | Permalink

In recent years we have written and spoke on the potential for retail networks such as Google, Amazon, PayPal, Facebook, etc to gradually enter the financial services industry in broader terms than disintermediating payments. Revenue from payments are being cannibalized already which is the life blood for FI's.

If we look at these network giants they have large, loyal customer bases across all ages groups and socio-economic segments. Like you some of us are regular shoppers on Amazon for an extensive array of services and products. Others are on their social networks more than once a day and the lists of followers continue to grow. Consequently these online companies have big data banks which help them target market millions within their subscribers-what great equity base for a  broader range of offerings including financial services!

This week American Banker had a very specific article of interest entitled, "Why are Amazon, PayPal meeting with bank regulators?".  The purpose would not surprise you!

This competitive possibility should be taken seriously. How is your competitive readiness? This question has to be addressed objectively without comfortable blinders and using a clinical analysis process. Every FI has customers dealing with the online networks and, in fact, loyalty could be in their favour.

Hopefully your competitive intelligence radar covers all future and emerging possibilities and not subjective summaries of known players. Also your digital game must be in top form to counter the obvious disintermediation on the horizon.

Pat Palmer | Saturday, September 30, 2017 | Trackbacks (0) | Permalink

Artificial Intelligence (AI) is the hot technology topic in most industries including financial services. So where will this take us and how will it effect institutions, customers and regulators to name a few? Intelligent technology has many beneficial possibilities but we should caution those who would assume that customers will readily adopt AI offerings that the tech firms and financial services management get excited about in isolation from market realities.

Today consumers control channel choices in an omnichannel landscape. They have become comfortable at not  only picking preferred suppliers but also managing their own service selections and experiences. Whether you are 18 or 65 financial and technological literacy has grown and continues to increase autonomy and acceptance. With software/apps today individuals can easily aggregate their multiple dealings and maintain their freedom to engage who they want, where and when. Plus, this independence that technology has facilitated will tend to gain greater acceptance over time. Some FI's are now trying to change this trend by offering personal financial services management AI packages which require customers to consolidate their dealings/transactions under a single umbrella to improve their financial profiles , plans and benefits. Will consumers be enticed to aggregate their dealings under a single FI's control or are they at the comfortable stage that they can do it and also have multiple options at their finger tips? Obviously continuous cross segment preference research is necessitated to ensure that investments mirror where customers want to go today and change as new ground-breaking options appear.

Pat Palmer | Thursday, September 28, 2017 | Trackbacks (0) | Permalink

The American Bankers Association just announced the findings of Americans' channel preferences in a sponsored study by Morning Consult.

The question asked was in regards to channel usage to manage bank accounts.

Results:

Internet-40%

Mobile-26%

Branches-18%

ATM-7%

Telephone-4%

Mail-2%


As you would expect those between 18-26 years of age use mobile banking most (46%) whereas those over 65 (52%) use online. Yes it is a digital world across all segments. When it comes to a branch preference only 11% of those 18-29 lean that way.

We expect that in other countries the preferences are more pronounced. Still there continues an over investment in branches and some credit unions are still not surfing the digital wave. 

Every FI should have its own proprietary research on channel preferences today and five years out as every customer base demonstrates different dynamics. You want to invest in the directions where you customers are going.

Pat Palmer | Wednesday, September 27, 2017 | Trackbacks (0) | Permalink

 


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