BLOG: The Eagles Nest

 



Big Brother is alive and well in Canada as StatsCan has request numerous banks to release a half a million customers' banking data to them, without peoples' approval, in an ongoing basis so it can aggregate the data for forecasting purposes instead of using the past mail out surveys. Here's a government that can't even operate a properly functioning payroll system for its own employees wanting access to banks' internal data.  Protecting individual's privacy has to be a key priority of all businesses and citizens need to have that security comfort.

If individuals volunteer to give governments access to their data after thoroughly understanding the risks and values, that is their decision. But, to force banks to open data collection off their systems by an outside organization is totally unacceptable even if it is Big Brother. StatsCan should find other more acceptable methodologies to collect research data like any private sector business and back away from using government clout to force banks to release customers' data without their approval.

Security concerns must be understood by all concerned when a third party intercepts what is suppose to be protected, private data of people and organizations. Undoubtedly, if this is permitted, other government departments will be sniffing around to do the same. Personally, if I found my FI releasing my banking data to any government department, I would close my account and move to a bank that guaranteed my privacy against such intrusions.

Pat Palmer | Monday, October 29, 2018 | Trackbacks (0) | Permalink

One of Canada's big 5 banks announced that they have set a target for one million new customers over the next five years with a focus on improving its digital footprint and related technology. I suspect that the bank has more details and definite parameters than just adding customers. 

First, every FI should focus on increasing the number of products each existing customer has as well as the profitability of each relationship. Plus there should be priority and secondary product goals established since you want to have the pivotal products in any relationship such as the main chequing account, residential mortgage,credit line and retirement/tax advantageous investments. Customers deal with multiple FI's and utilize an increasing number of products especially in the online world where they are in control of choices and consolidations.

Secondly, there needs to be clear customer segment/characteristic targets and with those, available, current research on related preferences and motivators especially relating to what will encourage switching to another FI plus facilitate such actions. Therefore, channel targets have to be customized to accessibility to the priority markets/prospects. Simply rewarding staff who bring in new clients could generate a lot of sign up activity which is costly and self-defeating.

Thirdly, the concentration on customers' digital dynamics is crucial in building the correct experiences and attractive options plus privacy guarantees. You must be able to do signups and verification online which should generate the majority of new business.

Every one is dealing with shared customers today and competition extends beyond the tradition FI's so strategies and tactics must consider these variables and not establish unrealistic captive customer goals. Bottom line is that adding any large number of customers encompasses many competitive influencing elements and distinct proposition advantages that demonstrate reasons to switch important business. Take the time to build the comprehensive solutions.

Pat Palmer | Thursday, October 25, 2018 | Trackbacks (0) | Permalink

Most FI products are looked at as commodities and most compete as if they are just that by pushing rates and related fees.

This philosophy shows a lack of customer focus differentiation and minimizes the value of any intangibles and relationships.

Customer-sensitive creativity takes a real mix of marketing efforts and research which some fail to do or simply don't want to be bothered.

There needs to be flexible,menu oriented value propositions which integrate options for each customer to customize a solution to fit individual needs and steer the decision away from a rate or fee comparison. These personalized propositions can be offered thru any channel and readily synchronize with digital preferences.

There are many methodologies available to assist an FI in creating the proper offer dynamics. If you have experiences with segmented focus groups, customers can and are usually willing to contribute, test and verify the best of breed packaging.

Some techniques are not suited to design development and can be misleading e.g. short tele-research calls.

Start with the customers preferences and conclude with their endorsements.


Pat Palmer | Friday, October 19, 2018 | Trackbacks (0) | Permalink

Articles appear regularly proposing how to increase sales in one channel or another based on the writers' experiences which may or may not be relevant for every FI or any for that matter. The first rule in selling is to know your customer/prospect. In other words your strategy has to be customer-centric and cater to evolving preferences and experiences. Contemporary customer channel preference research and segment profitability analyses are where we should start and hopefully your culture promotes an omni-channel collaboration and not channel competitions. As far as the customers are concerned, they control channel choices and they use multiple resources to do their research/comparisons. They are more technologically and financially literate than any previous era plus they have the ability to integrate/aggregate various suppliers they decide to deal with.

Consequently, the customer experience/sale begins with the customer not a specific channel or product. In most cases, the FI has only a few inter personal contacts if any over a year so FIs have to be on customers' radar not reactive at channel touch-points.

More work has to be invested in research and building share of mind with customers and prospects early in their experience spaces.


Pat Palmer | Thursday, October 18, 2018 | Trackbacks (0) | Permalink

 Where does your organization stand or hide when it comes to small business? Are you a competitive force or a passive political player? As I resident in a agri-rural community I see personal banking stores which milk this segment of profitable financial services but when it comes to small business most refer the prospects to their web sites or regional centres which don't normally visit our communities unless the requests are of more substantial amounts. 

Truly there is a vacuum of financing support which doesn't seem to concern the traditional lenders which are solely profit driven not customer-centric.

Alternatives are popping up in the form of micro-financing/innovation centre and social financing which is showing an ability to find the under-served. One of the new entrants is the Fair Financing Fund in Ontario which is targeting loans of $25000 to $75000 for farm projects similar to FarmWorks Investment Co-operative Limited in Nova Scotia. Local residents are paying attention to these and other initiatives. Do an Internet search and see other solutions in the marketplace. Concurrently, online personal banking options are gaining individuals' banking as they see more social financing possibilities and their traditional loyalties therefore are being eroded.

Pat Palmer | Monday, October 15, 2018 | Trackbacks (0) | Permalink

Relationships/customer experiences are built on many foundation corner stones and one of the most important is mutual trust. This invisible bond also brings with it expected obligations on both sides.

Sometimes FI's need wake-up calls when complacency sets in and assistance becomes too reactive and the customers are not receiving proactive advice that will benefit their financial well being. The current atmosphere of potential rate increases is a classic crossroad in customer experiences. Some customers are thinking, "What should I do if interest rates are poised to go up?".  How does it affect my borrowing and investment costs? Perhaps there are options to fix a mortgage rate or take on an early renewal at a blended rate. If there are core borrowings on credit cards, the home equity line of credit offers an economical solution. Does my FI offer an aggregation account through which my borrowings and daily surplus deposits are netted for optimum cash management? If you don't others do and a simple click and search will lead customers to the options. A similar philosophy can be applied to investments. Some, FI's may take the low road and try to keep quiet to protect current revenue streams and not cannibalize them-ouch!

The obvious warning flag for us in assessing FI's depth of proactive relationship management relates to account service charges and efforts to recommend the most economical package proactively. Great FI's offer online, contact centre and in-store advice on how to save a person from the nickel and dime torture that can befall them unexpectedly. Otherwise a few minutes of online research will offer solutions with competitors with easy transfer arrangements cover all recurring payments. 

Personally I like to hear, "Let me show you how I can help you today", rather than, "How can I help?". When organizations focus on customer-centric advice the culture changes and loyalty grows.

Pat Palmer | Sunday, October 14, 2018 | Trackbacks (0) | Permalink

WESI has enjoyed many years for individual and team coaching from Boards and CEO's to middle management and even new recruits. These customized interpersonal initiatives are built around peoples' strengths and priorities. Generally there is a real or perceived problem when it is a Board situation such as Directors not communicating with each other. On the other hand CEO's, especially in smaller FI's normally don't have an internal resource which can challenge them and help them grow. With middle management it is simply unleashing the potential that exists for the organization and the people. These are fun sessions with specific agenda focuses which will let people partner with others on a rotating basis plus understand the whole group's dynamics when collaboration is required. Actually, middle management usually contains a few diamonds in the rough which need to be polished and allowed to strategically sparkle.

Generally coaching works best prior to entering strategic discussions when the blinders have to come off and all the known and unknown options are place in front of participants. Secondly, once the Strategic Plan is documented, coaching again is essential to evaluate all action options relative to vision, values and performances goals which you want to exceed. Although none of us enjoy having to deal with unexpected diversions, those are also times to bring in the coaches so you don't just look in the mirror.

Pat Palmer | Thursday, October 11, 2018 | Trackbacks (0) | Permalink

Very disappointed this week with my RBC and its inability to contain a complaint where they are totally at fault in B.C. reprocessing the wrong automobile from the wrong person and allowing the story to get national attention. Making the scene worse is dragging the issue out and not quickly admitting the error and compensating the individual beyond expectations. If the bank can't maintain proper records, checks and balances on one car, people have to question their ability to protect customer records from internal human risks.

At one time the bank had a centralized Solution Centre which acted quickly and uniformly across the country to contain all complaints for expert and speedy validation and resolution. This situation appeared to be handled or mangled regionally by less than priority attention and public relations expertise. Once a story such as this is broadcast on multiple mediums it is out of your control and containment measures.

Always treat every complaint as an opportunity to exceed expectations and learn from the digital dynamics. Plus make the customer/prospect feel respected and that your interest is genuine- don't let your defensive barriers get in the way.

Pat Palmer | Tuesday, October 09, 2018 | Trackbacks (0) | Permalink

Have you sat down with SME's lately to get their perspective on Canadian financial services' dedication to their job creating engine. I meet with them regularly and there is a bad taste going around about hypocritical lenders which preach priorities and practice impersonal processes. Let me give you a couple examples which came to my attention. An entrepreneur in the commercial construction trades has built a multi-million dollar business in six years employing four dozen and servicing high quality clients such as major colleges plus receiving raving reviews and repeat business. A bank wouldn't give him an operating line, Canada's Business Development Bank want the see financials (no interview) before considering a credit line and a large credit union wouldn't give a straight answer only procrastination.Eventually he got a private working capital loan and has a negative attitude towards Canada's support for entrepreneurs.

Then there's a well known regional auto dealer in a small city with a long heritage in the area. Their new vehicle line is General Motors and their facilities are first class with third generation talent involved as well as the founder's son. They didn't borrow at one time but felt that the should have a million dollar credit line to handle expansion. Financials were provided which were sent by the local officials to the provincial headquarters' credit processors who turned it down! Needless to say another bank jumped at the chance.

In this same region, agriculture loans are also now being handled at arms length i.e. backroom submission preparations sent to central processors for decisions- without getting their boots dirty. Where are the relationship management principles in this cycle? It may be efficient for number crunching and declining business but it is an impersonal service. People make the successful difference in relationship selling/account management but if their hands are tied by ghost approvals perspectives are wrong.


Pat Palmer | Sunday, October 07, 2018 | Trackbacks (0) | Permalink

Over the decades our strategic thinking has evolved from white branding channels and products to technology platforms permitting separate business divisions with totally different operating/cost models which exemplify coopetition under a single corporate umbrella- not cannibalization as some traditionalists contend. BNS has Tangerine, CIBC, Simplii, Economical Insurance, Sonnet, etc across markets nationally and regionally. You are only restricted by your strategic imagination and enterprise resources available directly or through amalgamations and collaborations. Other examples that come to mind are Redwood Credit Union's automobile brokering/financing business in California or even the Canadian payments processing operation owned by major competing banks. The strategic synergies possible are endless. Take any service which a significant percentage of customers/members can use such as real estate brokering, then say why not!

In fact we believe that digital divisions are under utilized in the credit union movement where natural philosophies and agilities exit. Take say 5/6 credit unions forming a collaboration for a group digital division without the burden of legacy systems and inflexible attitudes. The division can compete locally or be piloted in a different regional market without the high cost of a branch build.

Online shopping is changing financial services and everyone can have a digital solution.

Pat Palmer | Sunday, October 07, 2018 | Trackbacks (0) | Permalink

 


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