This is, of course, the time for resolutions about how to become better, wiser, richer, or more loved. I haven’t been much good at applying such resolutions to my own life, so this year I am happy to offer them to others, specifically to folks in the financial services industry.

Automate Fully to Cut Insurance Costs
Partial automation, as an Avanade study found, can increase costs by requiring more staff to move information from system to system. Legacy systems have to be addressed in a consistent, long-term plan that looks at total processing costs and risks of maintaining the status quo. A couple of years ago Gartner’s Kimberly Harris said carriers should be moving as much as they can off the mainframe; services oriented architecture (SOA) allows firms to maintain legacy systems while developing flexible applications that can draw on their data. Time to get going!

Think Outside the Bank
The speakers from GonzoBanker at BAI (see www.gonzobanker.com) were almost as merciless in skewering bankers as famed strategist Michael Porter. Banks are almost all doing the same thing.

A senior Accenture exec told me a few days after BAI, “Bankers are lemmings.”

Growing market share in a stagnant market means taking customers away from the competition, and customers aren’t going to move for just slightly better interest rates or a few more locations.

Listen to your customers, not to what others in the bank say your customers are saying.

Banks are all eager to get into financial advice, but no one in the Gonzo focus groups wanted investment advice from the kid in the local branch. What causes this gap? Doesn’t anyone in banking run focus groups?

Dump the Hucksters
I just opened an envelope from a major bank saying it contained a check. It did. I thought I might have overpaid my balance. But it noted in small print that depositing the check signed me up for some sort of fee-based credit protection from a leading national bank. Here is a big American finance institution acting like a carnival barker at a state fair. It’s no different from my bank’s effort to push credit card insurance on me when I call in to activate my debit card. “Hey, just $1 for three shots at winning the big pink rabbit for that lovely girl on your arm!” Are these the firms I’d turn to for financial planning?

Get the Basics Right, Like Marriott Does
This seems to be improving. At my Bank of America branch in Paterson, NJ, a staff member whom I asked about signing up for Keep the Change took my details on a notepad and the sign-up was complete the next day. High touch, low tech. It works for me. Now, if they could just replace the burned out light over the outdoor ATM in this high-crime city. At Commerce Bank, the teller came out to show me how to use the coin counter. At Associated Bank in Sturgeon Bay, WI, they’re always friendly, but I attribute this to an odd Midwestern disease, or perhaps the fact they are actually encouraged to wear Packers outfits at work.

Pursue the Boomers
Fidelity is out there testing health insurance and promoting low-cost annuities that can be redeemed without huge penalties, and doing it without the awful boomer-oriented advertising that so often gets the message so wrong. I’ll put my money on Fidelity, and others, such as Vanguard, who have earned credibility and are using technology to deliver low-overhead products. These types of firms are making the effort to provide advice online or through call centers at relatively low-cost for small investors, and free personal advice (drawing on the same research) for folks with big bucks.

Make Personal Service Personal Again
The Wall Street Journal just cited an IVR Cheat Sheet Web site (http://www.paulenglish.com/ivr/) that provides the codes for bypassing interactive voice response at major corporations. I don’t know how many times I have been stuck in voice systems with no means to reach a person, all the while listening to a recording about how important my call is. As a Progressive Insurance exec said, this is both an obvious lie and an insult to the caller’s intelligence. If financial firms are going to claim to be customer-centric, they have to start acting that way or they deserve to be treated as commodities. Just as annoying is punching in your phone number upon request, only to be asked again once you have reached a person. Has anyone actually implemented computer-telephony integration?

Treat Clients as Professionals in Your Business
Here’s the news – a chunk of them are. Probably 10-20 percent of your customers are IT professionals or people who use IT at a high level everyday. When you can’t link incoming calls to screen pops for your customer service reps, or see you client’s total activity with your firm on one screen, they’ll conclude you’re operating in the Dark Ages (anyone from SBC listening?). Probably another 10-20 percent of your customers have worked professionally in some area of finance. More like 80-90 percent have their service expectations set by FedEx, Starbucks, and Amazon. Lousy technology, mediocre service, and trickster come-ons aren’t going to build customer loyalty.

Best Wishes for the New Year.

Tom Groenfeldt
Editor
Windows in Financial Services