Rekha Menon, Research and Controbuting Edi-             quality of interrogation and targeting methods    tor at FinacleCo...
Q   What challenges did NAB encounter while                     and other marketing programs doubled. And we         imple...
TABLE 1From Business Goals to CRM Functionality                                                         Typical contents o...
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CRM Leadership in Financial Services


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CRM Leadership in Financial Services

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  2. 2. Rekha Menon, Research and Controbuting Edi- quality of interrogation and targeting methods tor at FinacleConnect, talks about the bank’s has improved considerably. In addition, technol- CRM strategy to Gerd Schenkel - general man- ogy solutions have become more comprehensive. ager, customer strategy and cross-marketing at For example, in a call center environment, intel- NAB Australia, and to Paul Newton - head of ligence that was once used to support only out- customer knowledge and analytical marketing at bound calling is now being used to improve ser- NAB UK. Schenkel’s role at the NAB encom- vice and sales effectiveness for inbound oppor- passes customer strategy development and tunity where the rewards are potentially much implementation, market research, CRM & Na- greater for both customer and the bank. tional Leads, as well as cross-marketing for the Q What is National Australia Banks strategy Australian Region. Prior to joining NAB, Schenkel with regard to CRM and CRM technology? was the director of strategy and business devel- A Gerd Schenkel: CRM has been part of our strat- opment for Citigroup in Australia. Newton, on egy for the past 15 years. We were among the the other hand, manages the customer knowl- first few banks to focus strongly on CRM across edge and analytical marketing team at NAB in all businesses. Back in 1988, we designed the the UK. He has over 10 years experience in fi- first formal system to support relationship bank- nancial services industry and is an expert on ana- ing and a year later we developed a relationship lytical marketing, customer knowledge and cus- management and customer profitability system. tomer relationship management. Initially we had an in-house developed CRMQ What is the importance of CRM for banks? solution, but later adopted a state-of-the-art best-A Paul Newton: CRM is a very broad term. Es- of-breed approach. Currently our technology in- sentially, it is a key enabler demonstrating that frastructure consists of a global data warehouse; banks understand their customers. For the bank- a dedicated CRM database; a data mart for ana- ing industry, where there is a wealth of informa- lytical and predictive modeling; and a campaign tion about customers, CRM is vital for success. management system that determines the infor- It enables banks to meet customer requirements mation and delivery channel through which to by demonstrating that we understand the indi- communicate with our customers. Solutions like viduals’ needs and can bring relevance to our our award-winning National Leads system have marketing messages. This is essential if we are to been very effective in helping us generate per- ensure business growth sonalized and relevant leads for the bank’s rela-Q How has CRM in the banking industry tionship managers and customers. evolved in recent years? Around 18 months back, there was large scaleA Paul Newton: Overall there is an enhanced de- organizational change at NAB. The bank moved gree of maturity in bank’s understanding of from a functional structure to a regional struc- CRM. For example, there is a realization of the ture where our operations were split into three increasing diversity of customer touch points regions, Australia, UK and New Zealand. Under and the complexity involved in gathering data. this new structure, we are collaborating on our Banks, therefore realize that there is a need to CRM work between the different regions so as have proactive interaction with customers. The to share the knowledge and experience gained technology too has evolved. There is increas- over the years as well as leverage the ingly a move towards real-time solutions. The infrastructural investment across the group. 9
  3. 3. Q What challenges did NAB encounter while and other marketing programs doubled. And we implementing contemporary CRM technology? are starting to see much higher levels of cus- A tomer satisfaction. Gerd Schenkel: There have been a number of changes at NAB, starting from changes in the Q What in your opinion is the key factor banks organization structure to expansion of delivery should consider to leverage the power of CRM channels. Our CRM infrastructure had to evolve technology to the fullest? with these changes and robustly cope with and A Gerd Schenkel: The CRM solution needs to take advantage of new interfaces and the increase support the bank’s needs. For instance, in retail in the amount and richness of data. Currently banking there are a large number of customers in our system looks at around 1 billion items of a banker’s portfolio while in business banking, data every night including every customer’s past there are fewer customers but with larger bal- year transaction history. ances and often with more complex requirements. Q What benefits has NAB achieved through its The CRM system has to be used differently for CRM strategy? both segments. For the solution to be effective, a A Gerd Schenkel: If a CRM system is deployed bank needs to know how best to use the technol- correctly, it improves overall productivity of the ogy for different business needs. sales force by helping them prioritise activities. Paul Newton: It is also important to realise that Further, rather than simply generating generic CRM is a solution to real business problems. sales calls, our solution generates very targeted And that it is not just about technology. CRM’s focused opportunities that show a real under- success lies with the people using the technol- standing of customer requirements. It may be ogy. I think that was the problem with a number related to an existing product, a change in the of CRM deployments earlier. Within a bank, staff service being used or simply some advice. This buy-in into a CRM program is extremely impor- approach is really appreciated by our customers. tant. Otherwise, either they will not use the Paul Newton: We believe that we have in place CRM tools, or the quality of the experiential a solution that puts the NAB, UK at par with and contextual customer data that is collected the leading competitors in the market. Our plans will not be good enough. At NAB, UK we have for the next 12/18 months should see us move therefore made sure that investment programmes ahead. Our TOPs (Tailored Opportunities) in creating CRM technology have also taken ac- programme helps us to understand our custom- count of the cultural changes we need to achieve ers’ requirements, identify opportunities and through training, performance measurement and learn more about the drivers of value for NAB. reporting tools We deploy events such as ‘understanding cus- tomer profit’, ‘the impact on profit of various actions’, ‘customer appetite for various prod- ucts and services’, ‘risk profiles’ and ‘life stages’ to tie everything together. The team works across all customer segments, products and services ir- respective of channel. Our progress to date is strong. Last year, in the UK, income generated downstream from outbound calls, direct mails1610
  4. 4. TABLE 1From Business Goals to CRM Functionality Typical contents of Single or Benefits of Single orThere are primarily four goals that banks 360 Degree Customer View 360 Degree Viewpursue and the entire customer relation-ship management initiative needs to be Accounts held by a customer aggregated Channel and bank wide access to identi-driven by these. across host systems cal, updated information about a customer eliminates information asymmetry and re- Growth in revenue sultant inefficiencies. Growth in customer base Sales opportunities being pursued for a Viewing all open opportunities for a cus- Growth in margins customer tomer/prospect allows front office and sales personnel to give an up to date account of Increased customer satisfaction the progress of the application filed by a customer/prospectTo work towards any of the four strategicobjectives, it is important to aggregate and Offers targeted at the customer Visibility into offers allows front office staffconsolidate customer data that is distrib- to sell at each customer contactuted in multiple host systems. The singleview of the customer thus obtained can then Service requests or complaints filed by the Visibility into service requests and com-be utilized for focused marketing, sales and customer plaints filed ensure that branch, call centercustomer service activities. Table 1 is an and contact center employees can quickly check status and resolve queries instead ofillustration of the types and benefits of asking aroundcustomer data integration. Details of the loyalty points aggregated to Front office staff can manage queries and date by the customer redemption requests on loyalty points.Table 2.0 in the next section aims to pro-vide you with a framework for drillingdown from corporate objectives to the List of notifications on important customer Relationship managers and front office staffchoice of specific CRM modules that can events such as birth day, term deposit ex- can greet customers, alert them that termenable the business strategy. While the piry, large withdrawals, deposits, etc. deposits are due for renewal, and with their proactive behaviour contribute to improvedbusiness objectives or goals are the pivots customer satisfaction.of the table, the ‘X’ axis represents the vari-ous levers that need to be operated to Customer profile information such as seg- Knowing who they are dealing with allowsachieve the goal. The activities under each mentation, profitability, product holding, employees to tailor their behaviour suit- length of relationship, household data, etc. ably.lever are not exhaustive but they are fairlydetailed and represent what ‘CRM centric’banks do to unlock value from CRM. 13