Checklist Item 1: Let customer interest drive innovation

Whenever a customer initiates a transaction, it’s a moment of truth for his bank. Likewise, the acid test of a banking innovation is its impact on customer experience. Enough has been said about the role of technology-led innovation in improving customer experience and retention; far less on how banks can innovate on their customer management strategies. So let’s take it from there.

In a joint study conducted by the European Financial Management and Marketing Association (EFMA) and Finacle from Infosys, it was found that although European banks stressed the importance of customer relationship development through innovation, they had little to show for it. One way of ensuring that customer interest is paid more than lip service is to give it support at the highest levels. A Chief Customer Officer, in whom the responsibility of organisation-wide customer management is vested, can provide the necessary focus and muscle. It is important that the CCO’s sphere of influence extends beyond the boundaries of channel or line of business, so that the entire organisation is similarly oriented towards customer management.

Customer strategy could also do with a dose of innovation. When customer needs are so diverse and complex, how can the same strategy serve all? Customer segments must be redrawn according to composite demographic, economic and psychographic parameters.

If we must innovate, let it be to fulfil customer needs. What say?