The changing face of CRM in financial institutions.
Posted Apr 28, 2003
In the wake of skepticism about enterprisewide CRM implementations, many in the financial services industry are shying away from large-scale implementations of customer service technology. With a tough economy and stiffer competition, every technology implementation faces a challenge from CFOs, who have tightened their budgets during the economic decline, and CIOs at financial institutions can no longer take risks on IT projects without a guarantee of proven success rates. As a result, organizations are finding it difficult to justify the expense without an immediate return on investment, and are moving to smaller implementations that show fast ROI.
Even as financial services companies evaluate CRM initiatives more closely, customers are demanding more robust online services, and the industry must move towards greater Web-based customer service. A complete online offering has become a competitive differentiator among banks and other financial institutions as more and more customers look for convenient ways to perform financial transactions. The rise of the Internet provides the opportunity for online transactions, from paying bills to stock trades. However, as these services grow, financial institutions are facing great demands on their call center resources. The obvious solution is to move customer inquiries to the Web through CRM initiatives.
Targeting Pain Points
The financial services industry faces unique challenges as it incorporates Web-based interactions. Financial institutions must ensure secure messaging for all interactions over the Web as well as consistent communication across all channels. Companies within the industry must implement technologies that can scale with the organization as its customer base grows. In addition, due to regulatory issues, many of these communications require immediate responses or guaranteed delivery, resulting in the need for event-triggered messages.
In adding Web-based service, financial institutions must implement CRM applications targeted towards the actual business problems, such as those listed above, that they hope to alleviate. Instead of the long-term implementation of a suite of products, organizations should pinpoint the specific business problems, or pain points, facing their contact centers and work to fix those situations first. An investment bank can insure consistent communication across all channels by providing automated, approved responses to email inquiries through the deployment of an email response application. A credit card company can cut down on calls to the call center by proactively alerting customers through emails when they are approaching their credit limit. A mortgage company can provide self-service options to its customers by allowing them to search for their answers through an external-facing knowledge base, then directly escalate to an agent-assisted interaction to get help in completing the online loan documents. Targeting specific problems with this approach to CRM implementations enables the decision-makers in an organization to see faster and more quantifiable ROI, while the financial services organization meets the demands of the consumer.
Inevitably, as organizations in the financial services industry begin to move more transactions to the Web, the need for Web-based customer service applications will grow. As companies implement CRM initiatives, it is essential to choose applications based on a modular architecture. This will ensure that individual products selected for specific problems can be seamlessly integrated into a suite of CRM applications. By building a CRM suite this way, organizations can anticipate future needs and eventually expand customer service across the organization, increasing the impact the technologies have on the customer and the enterprise's bottom line.
Using a Systems Integrator
One of the keys for CRM success for financial services organizations is utilizing the experience and knowledge of a systems integrator during implementation. Unlike legacy client/server software, today's modular, Web-architected business applications are configurable such that industry best practices and the business practices of the financial services organization can be applied to tailor the applications to the business needs. A close partnership between the company, SI and vendor helps to ensure that goals are met and the implementation is successful.
Financial services institutions can benefit from the experience of integrators who have worked on many implementations in the industry. These integrators understand the unique needs of the institutions competing in this market and can help companies make targeted investments in CRM. Before deployment, systems integrators provide valuable consultation on specific products available based on their experiences in the market. These integrators have knowledge of which products work best for solving which business problems and the experience to effectively recommend a CRM application that will provide proven results.
More important, partners work side-by-side with organizations and vendors to ensure rapid ROI through smooth customizations and implementations. Integrators can proactively prevent many of the snags that arise during deployment, including scalability and usability issues that may result in a prolonged deployment time.
When selecting a CRM product, financial institutions must look to vendors with specific experience in their market. After many successful implementations, these vendors are able to provide applications optimized for the financial services vertical. Business rules, workflow, and customizations that have proven successful are then integrated into a unique product set for financial services organizations. This enables financial institutions to cater to the specific needs of their customers and ultimately, establish better customer relationships. In addition, tailored applications for the financial services industry typically see shorter deployment times, leading to a quicker return on investment.
While some financial services organizations are taking a more cautious approach to purchasing a CRM application, successful organizations will recognize that by using some of these strategies, the return from a CRM deployment will far overweigh the costs. The financial services industry must respond to the growing demand for customer service using Web-based channels of communication. The result will be not only effective customer service, but also clear and measurable cost savings.
About the Author
Chris Hall has 15-plus years experience in the CRM industry and has been instrumental in leading the direction and strategy for KANA's innovative Contact Center products. Prior to joining KANA, he spent a decade working in many diverse areas of Customer Relationship Management. From line manager of CRM consulting practices to call center operations, Chris uses his experience to strategize with and develop innovative products for today's largest industries.
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