Ahem, Bank Honcho! You’ve Got a SIT-U-A-TION!

You know that Clorox commercial where the little boy rushes into the bathroom in the nick of time, but he can’t figure out how to undo his belt?  “Oh no! Oh no! Oh no!” he says. “I hate this belt. I hate this belt… MOM!… We Have a SIT-U-A-TION!”

Yes, the little boy’s sense of frustration  is funny. But in the financial services industry, the urgency of customer frustration is no joke. Nope, in fact, customer frustration is one of the biggest contributors to customer defections. The same is true in banking. Here’s the math on the situation: 27 percent of unhappy bank customers defect every  year, according to  the experts at Bain & Company. On top of that, frustrated customers represent over $600 billion  in  deposits and revenue at risk, according to a recent brand vulnerability study by the industry experts at cg42.

I saw this frustration in action the other day, when I walked into MEGABANK to make a cash deposit. (I’ve changed the name of the bank to protect the innocent). There was a single stressed out teller working both the main counter and the drive-thru window. The vibe in the branch itself was low energy. No hustle, no bustle. And, too few tellers working the main counter.

Ticked off by the slow pace of service, the lady behind me complained that it was always like this at MEGABANK. Then, she summoned the honcho sitting in the nearby office. “Why don’t you have  more people working the counter? She asked. It’s really busy in here.”

“I’ve got two people back there now, which is what we usually have” said the honcho.”

“No… you don’t have two people back there,” said the lady.  “You only have one.  That other teller is busy doing other things. She hasn’t waited on anyone since I’ve been here… Every time I come to this branch, it’s the same story — long lines, slow service.”

“Sorry Miss,” said the honcho, as he walked back to his office. “We’re doing the best we can.”

“They just don’t care,” said the lady. You’d think they’d schedule more tellers for peak hours, to speed things up. This is ridiculous. I’m seriously thinking about switching banks.”

Perhaps the honcho miscalculated, and scheduled too few tellers to work the counter, in an effort to reduce costs. But the best brands aren’t winning customers by just simply cutting costs. Nope, they’re winning customers by making it easier for customers to get the service they need.

It turns out that this is what bank customers care about most, according to a recent story in the Wall Street Journal (WSJ). Yes, access to branchless and mobile banking is important to many bank customers. But so is the customer experience delivered by brick-and-mortar branches. Some 35 percent of WSJ readers said so.

The thing is, when people want to borrow money to purchase a home, a car, a vacation, whatever… they want fast, easy access to the funds. In other words, if you’re in the business of taking deposits or issuing securities, making loans, keeping assets in custody or trust, or managing them to generate a return, every customer interaction is an opportunity for you to eliminate frustration that can put potential revenue at risk.

This kind of risk happens when customers don’t feel like their time is valued. Like when you start, stop and resume a transaction on your mobile banking app. Then, when you call customer service, you are forced to repeat information to a contact center agent, who has no idea why you called in the first place.

Or maybe you want to apply for a business loan. But you have to manually fill out a loan application at a branch location. Then, the application is emailed or faxed to a loan officer, who sends it to an outside Appraisal and Title company. Then, days or weeks later, the application comes back to the branch for a loan officer to approve.

These kinds of slow, inconvenient business processes have put revenue at risk with digital disruptors like Lending Club and Kabbage. These unconventional lenders have developed faster digital underwriting processes, which can make loans of up to $100,000 in minutes.

But what if you could outmaneuver the disruptors with faster, mobile Loan Origination  applications to accelerate loan approvals? What if you could quickly deploy these apps, without the hassle and cost of provisioning and maintaining on-premises hardware?  What if you could simplify the complicated processes behind routine, customer-facing transactions, to cut customer frustration to the bone? In the old days, this kind of digital speed was harder to come by. We didn’t have the speed and power of enterprise-grade, low-code app development.

Cue up the boy in the ‘situation’ commercial. Sometimes an image captures urgency better than words.  This Clorox ad does that perfectly.

My point is that in today’s economy, where customer interactions matter more than ever, there’s a sense of urgency about embracing  digital transformation. Think about it. The number of devices on the Internet of Things (IoT) will more than double to 22 billion by 2018, according to IDC. This digital trend will drive the development of 200,000 new apps and solutions to take advantage of IoT devices. On top of that, organizations like yours will have to overhaul legacy customer engagement systems to support up to 10,000 times more customers and customer interactions than you do today. 

Yes, digital transformation will help you keep your IT operations humming.  But the coolest thing about digital transformation is that it will help you win new customers and  keep more of the ones you already have. For aspiring bank honchos, what could be more important than that?

Roland Alston