For Banks, Customer Service is Key – How the next wave of Customer Centric Process Management (CCPM) solutions will bolster satisfaction

By Jon Rabinowitz, Director of marketing at Sparta Systems, Inc.

Today’s multinational financial services organizations operate not only under a dark cloud of an expanding credit crunch (and likely recession), but also beset by rising customer complaints that often result in highly profitable customers defecting to competitors.

Research shows that consumers are growing increasingly distrustful of financial institutions that handle their money, due mostly to the slow, cumbersome customer service “barriers” that many banks have erected that leave customers angry and confused when their inquiries and complaints are not addressed quickly.

According to Forrester Research Inc., 52 percent of decision makers at North American financial service firms stated that increasing satisfaction levels with existing customers was a very important goal. From the same research report, 57% stated that retaining exiting customers was a critical objective.[1]

What can financial institutions do to immediately improve relationships with their customers, while at the same time improve process inefficiencies?

Many forward-looking financial services companies have come to the realization that providing a positive customer experience is a strategic and competitive advantage. After all, holding onto the most profitable customers is the surest way to increase wallet-share, and improve customer satisfactions during tough economic times.

Complaints Continue to Mount

The number of customer complaints received by financial services organizations continues to rise each year. Today’s customers are increasingly tech savvy and play an active role in managing their accounts online. Still, when they have a question, or when they spot a mistake with their account, all customers need to know they can reach a live person who can quickly resolve the problem.

Unfortunately, that’s often not possible given the myriad homegrown customer inquiry management systems that most financial services companies have put in place. Many companies still use spreadsheets or manual processes that are inefficient, expensive to support and cannot be used throughout the different departments of a company. This often results in customer complaints that go unaddressed for weeks or months at a time simply because customer support personnel lack the legacy knowledge to help the customer.

Regulatory Concerns Grow More Intense

Compounding the issue of customer satisfaction are concerns over regulatory mandates. New federal regulations have emerged to ensure companies are more accountable for how they treat customers and handle complaints and inquiries.

As a result, complaint handling has already become a major factor when regulatory bodies determine a firm’s risk rating. And customer inquiries and complaints generate enormous amounts of data that must be properly processed, stored and safeguarded in order to keep pace with ever changing regulatory pressures. How can this be done efficiently?

As regulations and filing requirements increase in number and complexity, the task of tracking compliance and ensuring timely submissions and updates (paper and electronic) is becoming ever more critical and daunting. For example, regulatory and SRO scrutiny over financial services’ interactions with customers is on the rise, especially with regards to inquiry and complaint handling. Strict guidelines, both with respect to the promptness and quality of responses to customers as well as timeliness of broker-dealer and organizational disclosures regarding complaints and arbitrations demand that strong controls be put in place.

Today’s financial services companies need complete, fully integrated compliance tracking and regulatory reporting systems, both as standalone systems as well as seamlessly integrated solutions that are part of an operational process management system like complaint handling.

With the right systems and people in place, financial services companies can ensure that operational processes adhere to regulatory guidelines, provide real-time visibility into status, timeliness and overdue actions, automatically escalate high-risk situations, enforces strict role-based access controls including electronic signatures across departments, and record all activities and changes for legal and regulatory provability and audits. Disclosure and periodic summary filings are streamlined using automatic form generation tools and support for electronic submissions.

The rise of customer-centric tools

Firms today must embrace the challenge of improving and maintaining strong customer relationships. The first imperative is to implement a “closed loop” IT solution that allows companies to capture a complaint from the moment it is submitted and track it through categorization, investigation, correspondence and settlement.

This also significantly eases the regulatory pressures for financial services organizations. Taking decisive actions to monitor, report and resolve incidents and issues is an essential practice for effective governance. Moreover, implementing rapid issue remediation with an effective corrective action system is required for any financial services organization that must comply with extensive and changing regulations and standards.

Integrating CCPM into your organization

Integrating any kind of new system into an organization is always a challenge – especially with CCMP as it’s so critical to integrate with any system that houses important data such as customer transaction details. In an industry where revenue is directly affected by customer satisfaction, providing one common view of data and information for all customer-facing personnel is essential. Given the widespread use of product-centric data silos, combined with fact that may companies still use spreadsheets to consolidate data from multiple IT applications, it is no surprise that many financial services organizations continue to struggle with customer complaint and inquiry management.

Process management systems with automated reporting, a way to view process performance (e.g., dashboards) and SOA compatibility are valuable to a variety of industries. However, because financial services is a heavily regulated, highly competitive industry that demands continually high levels of customer satisfaction, success and differentiation often depend on process tools that offer more. Tools that not only offer increases in operational efficiency, but also reduce regulatory risks while improving customer satisfaction levels across the company represent a big leap forward for companies that want to bolster profits while reducing risk.

What to look for in a Customer Centric Process Management solution

To ensure your organization is optimizing customer satisfaction while significantly reducing risk, be sure to address the following questions before committing to a particular solution or strategy:

• Does the solution integrate easily with existing ERP and CRM systems and provide direct “look-up” and “linking to” master product information to improve accuracy and streamline operations?
• Does the solution perform consolidated trending for internal quality management functions to uncover root cause analysis?
• Does the solution have an automated reporting system for internal and external audits?
• Is the solution fully customizable so all customer-facing personnel can easily ramp up on the new process?
• Ensure the solution offers timely disclosure and periodic summary filings per regulatory requirements.

Reference:

[1] “Trends in Retail Financial Services”, 2006