Managing the change in consumer preferences, and consequent client relationship management practices, is proving to be a real challenge. The new core features are: transparency, timeliness and accuracy of processes, natural and immediate multi-channel access and ability to generate confidence.
In the past these factors mattered less, but as power is shifting quickly within the industry, today they are the prerequisites to remain competitive and the key dimensions on which financial players are judged. Digital technology is changing the relationship between banks and their customers. The impact on operations, branch networks and information systems is extended, radical and pervasive, and an increase in human capital is needed to manage this new complexity.
The impact on branch networks is significant. On the one hand, banks have an urgent need to rationalise and reduce their branch networks, on the other, they understand that a new branch –completely different from the traditional paradigm – could play a key role in delivering innovative and exclusive services to customers. To keep branches relevant, banks must ensure they recover central role as hubs for relationship building between the bank and its customers.
There is a resulting need to rethink the business model entirely, taking a balanced approach somewhere in-between a full-cash and cashless paradigm, and placing customer experience and innovation at its centre. This means leveraging on digital areas, advanced ATMs, paperless processes, flexible hours, etc., but also requires revisited and customised products for specific targets, a simplified value chain and lean operations.
Moreover, the now constant and intense interaction between customers and the social-financial ecosystem creates the opportunity to build big data management systems to capture and analyse clients’ behaviours and preferences. These systems need to be advanced and scalable, as well as capable to perform comprehensive and customised analyses, not based on traditional segmentation criteria. The goal is to identify the client transactional and social behaviour, analyse it and activate trade actions to propose products in real time, obtaining a much higher success rate compared to traditional campaigns.
The whole paradigm for designing, managing and monitoring the financial services industry is changing, not only the client relationship model.