“We are stuck with technology when what we really want is just stuff that works.”
―Douglas Adams, the Salmon of Doubt
If I were to go to most bankers today and ask them what one thing they would do to improve their systems environment, a large number would say better integration of the systems they are using.
Ten years ago, if I had asked them that same question, the majority probably would have said – hang on to your hats here – better systems integration. Despite a lot of focus on middleware, application programming interfaces (APIs) and other tools, this issue has never stopped being top of mind with system users.
So this brings me to another, related question. How many readers have waited to board a delayed flight that was supposed to take off in 20 minutes but there was no stinkin’ plane at the gate and the gate agents were completely silent and pretending nothing’s wrong? Maddening, wasn’t it?
It’s funny how that doesn’t happen to me anymore. The late part does, but not the lack of information. This week, I received an alert from the airline telling me my flight would be delayed, and I got it before the gate agents were notified. In this case, the gate agent asked me if I’d heard anything yet.
Why? Because she and I both had access to the exact same system, but it so happened that I got notified first. So did about 20 other people. My frustration with the flight being late was there, but I had no problems with the experience. In fact, it’s better.
So let’s ask ourselves this: in banking, why does crossing channels still equate to crossing systems that then need to be integrated? In other industries that rely on digital and physical channels, there is a very clear design principle: there is one system for both customer self-service and employee delivery to customers. There are just different levels of permissions and configuration. Think about it. Did Amazon design one system for employees and another for customers? Uber? Fed Ex for tracking shipments? Of course not. They never even thought about it. And, to boot, they started their system design from the front end (consumer experience) and designed the back end second.
Jump to our current set of banking delivery systems. I just finished sitting through the third omnichannel presentation in two weeks telling me that customers want a seamless experience when crossing channels. Really? Like I thought they wanted it to be choppy? (For a more thorough discussion of the current state of omnichannel delivery, check out Scott Hodgins’ recent post, Meet Brock Thorpe. Pretty much summed it up.)
Now, to be fair to the banking industry, we had to have systems designed for employees long before customer self-service was an issue. Branches, lending, call center – they were built after the back-end system was written, and they were built on the older platforms that were available at the time. Then, years later, we had to design self-service solutions that we couldn’t use the older tools to build. The result was different systems for customers and employees. OK, there was really no other way it could have played out. But where does that leave us now? Well …
- In most financial institutions, if a customer starts a deposit application on line and wants to finish it in the branch, data has to pass to the branch platform system.
- If a loan application gets started on line, data is usually passed between the application system and the underwriting/closing/doc system.
- If a customer corresponds with the FI via the online app system (a question, a problem), it never gets passed to the core or CRM contact history file.
- The customer digital self-service channel tool for commercial banking is this cool 20th-century system called “send-an-e-mail.”
These are just a few examples of multi-system design results that need to be improved to provide the experience customers get in other industries. The question we have to discuss, banks and vendors, is this: over time, how much of this do we want to accomplish by building better integration between systems, and how much do we want to do by rewriting systems following the design principle of other industries – customers and employees use a common system and the front-end experience is the start point?
Increasingly, the evidence points to the latter option and we can see it already taking hold:
Mortgage. You can see the progress and the benefits. A ton of mortgage lenders now have employees input the app in the same system the customer uses. Loan status notifications get sent to the employees assigned to the loan and the customer at the same time. One database. No interface. Man, you have to give it to Mortgagebot and Prime Alliance. Maybe a lot of it wasn’t planned at first, and their original idea was only to get an online 1003, but look where mortgage application systems are now. Those guys started a big ball rolling.
Prediction: This is over. There is one mortgage application tool for customers and employees. More and more of the back-end functions will be rolled into the application tool over time and we’ll be down to one system.
Deposit Account Opening. In at least half of the system selections we have done in the last two years that involved branches, the system selected for online applications was also deployed in the branch new accounts area. Customers and employees see the same information and update the same file, just with different permissions. Same system, same application that a customer and an employee works on sans integration. And, for grins, let’s throw in Consumer Loan Applications, which are being designed on the same platform. Meridian Link http://www.meridianlink.com/ got the early lead in this area, but there are several very credible solutions offered by core and independent vendors that have the same design and intent. Now, I understand that the pushback right now on these systems is that they don’t yet do all of the maintenance transactions, and they can be expensive. My response? First, where do we put our dollars: integrating two systems, or building out maintenance and other capabilities in the front-end application system? I vote the latter. And, as for cost, it will not slow this trend. Cost always gets rational and commoditized.
Prediction: There will be one system used by customers and employees for deposit origination and consumer loan applications in the next two to four years at most banks. The online application system will replace the current branch deposit opening system. Maintenance and other transactions will be added to the origination system. Adios to the traditional new accounts software. Let’s get on with it.
Transaction Processing and Servicing. I am going to include teller systems, call center systems, Internet banking and mobile in this discussion. And, just to sweeten the pot, let’s add small business to the retail customer base. Here’s my take: can’t we already see the merging of service transactions? Let’s look at behavior. Customers deposit checks on their own, and we do it for them. They look up history, we look up history. They look up images, we look up images. They look at transaction history, we do too. They renew CDs, we do too. They use portable devices much more, and we are talking about branches where employees are walking around with mobile devices. Both customers and tellers end up out of balance at the end of the day, trying to find the $20 they’re short (well, speaking for myself, anyway). Question: this being the case, why should customers and employees use different systems to do all of this? What makes the question even more interesting is that among the other things mobile devices and software bring to the table is the long-term ability to pull this off on one system. Several vendors, Malauzai being one example, are already showing this thinking in their designs.
Now I can hear the pushback. What about all of the teller transactions that have nothing to do with customers? Buy/sell cash. Place a 2-sig required hold. Why would we want to do that?
My answer? Where do we want to spend our money – maintaining different systems for employees (many on older platforms) and customers, then maintaining a raft of integration (CRM, imaging systems, etc.), or writing one system everybody can use and integrating these systems once, with the added bonus of designing an experience and service level that makes customers feel like they are dealing with a digital-age company? I think this dude’s vote is clear.
Prediction: We will start this conversation in earnest with the long-term goal of having one servicing system for customers and all employees, and the system/design that will survive is …. mobile. Yes, Gonzo devotees, tellers will ultimately use an amped-up mobile app. Call me a nitwit if you like, but at least give me that I left the box. So, let’s get on with it.
Commercial. A tougher conversation, because there is a lot less self-service that occurs in these relationships. But, we can all see the early design in commercial lending systems that incorporate the customer into the employee workflow tool. We need new financial statements or tax returns. We track them in system workflow. The customer accesses the same system to provide them and clear the item.
Prediction: There will be a single system used by employees and customers for any decisioning or servicing interactions that require both parties to do something. Good news – we’re already getting on with it.
I don’t underestimate the cost, effort and frustration all this would entail. I get the years of design that would be given the axe. I even get that by now some readers have decided that my IQ is slightly below that of a tree stump.
But you know what? I keep hearing that the industry needs to be relevant in customers’ daily activities. And hip. And that, more and more, it’s about the customer experience being consistent across channels. And that their yardstick for rating our experience is Apple, and Amazon, and lots of other non-bank players.
They only have one system for everybody, not different ones they integrate.
So, let’s get on with it.
Where do you fall on the customer experience yardstick?
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