Many of the most valuable customers in banking have multiple products across multiple lines of business—a mortgage, credit cards, checking and savings, auto loan, life insurance, CDs, IRAs, and more. But can a bank’s employees see all those relationships easily, in a single view? The answer is often no.
Moreover, banking is a multigenerational business. Youngsters entering adulthood are influenced in their banking choices by their parents, and with compounding and subsequent wealth transfers the lifetime value effect is exponential across generations. Unless a bank has a deep customer-centric view that extends across family (and business) relationships to enable it to understand and pursue opportunities within those networks, it’s leaving money on the table.
Today’s challenging banking environment is prompting institutions to re-examine the concept of customer centricity. Faced with slow growth and finite numbers of customers, many are recognizing the imperative to adopt and leverage a customer-centric approach. In fact, the mindshare around customer centricity today is probably the greatest I’ve seen in my 35 years in financial services.
But as I wrote in an Executive brief titled “How Banks Can Generate More Revenue and Profit by Enabling Customer Centricity” it is no easy task from an IT standpoint primarily due to account-centric systems and, in many cases, the inherited operational limits tied to merger and acquisition integration challenges. For a quick analysis of customer-centric readiness, consider these four questions:
- Do your bank employees have easy access to a complete view of a customer’s relationships across the bank?
- Does your management team believe that each customer has lifetime potential?
- Can your bank create “customer plans” by the thousands or millions?
- Can your employees analyze variations at the customer plan level?
Financial institutions can generate more revenue and profit by guiding customers throughout their financial lifecycle and helping them navigate through multiple purchase decisions by offering the best product based on their needs. To put a customer-centric approach into action, banks must explore how technology solutions such as master data management (MDM) can overcome the barriers of account-centric systems.
Download the Executive brief, titled “How Banks Can Generate More Revenue and Profit by Enabling Customer Centricity” to learn more.