Posted , in Differentiation
Putting customers at the front of the queue in banking
“Overall, a customer-centric focus is the biggest change in the financial services market in recent years” …said a consultant we spoke to for our 2018 financial services sector market report. And we don’t disagree with her: In fact, the general realisation that putting customers first is key to winning—and staying in—business is spreading like cross-sector wildfire.
With the likes of Amazon, Facebook, and Google leading the charge in delivering A-grade customer experience, the general population has, in a very short space of time, come to expect this level of service as standard. Technology players in other sectors—such as retail—are adopting cutting-edge approaches to improve the customer experience, and this is forcing financial services players to up their game considerably. And there are no exceptions to this rule: Got a huge, immovable legacy system that makes changing existing IT architecture and implementing new systems painful, slow, and expensive? Too bad. Lack the agility to make far-reaching changes in your culture or operations? Boo-hoo. Customers’ insatiable appetite for a simple and immediate banking experience isn’t about to go away anytime… well, ever. And waiting in the wings are the start-up digital banks that are making the most of traditional banks’ predicaments, offering svelte, digitally focused services to an audience who’s not too bothered about who they bank with—as long as that bank services their needs. Customer loyalty for loyalty’s sake is now nothing short of a mug’s game.
Indeed, the numbers don’t lie. High street banks are shutting branches at an alarming rate, with old favourites clearly on customers’ chopping block. In the UK alone, 2,868 bank branches will have closed between 2015 and the end of this year, with NatWest, HSBC, Lloyds, RBS and Barclays taking the biggest hits. It’s not hard to understand why so many banks are desperate for help in turning this situation around.
And this is where the opportunities abound for consultants right now: helping banks to—literally—reinvent themselves. At the top of banking clients’ wish list is to find consultants who can help them improve the customer experience, and put in place the underlying technology and organisational architecture needed to support its delivery. Not far behind that is the need for consultants to help change propositions, and build partnerships and ecosystems that will help banks combat inertia, all the while trying to keep costs down as banks feel the pinch of the competition.
In fact, there’s so much that needs doing that traditional consulting firms may find that they—like their clients—are now falling short of their customers’ requirements—in this case, by not having the depth and breadth of expertise needed to get the job done. Like the banks they serve, consulting firms must assess and respond to their own shortcomings if they’re going to achieve their growth ambitions and play a part helping banks to address their huge—and potentially lucrative—challenges. That may entail bringing in reinforcements, including making acquisitions and/or developing their own ecosystems to enhance their capabilities, with digital design capability at the centre of this.
Putting the customer journey at the centre of a business model is, therefore, not only revolutionising the way banks do business, but it’s also forcing consulting firms to do the same.