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Commercial Loan Automation
Credit - Small Loans
Efficiency and Customer Experience
Two experiences have recently been brought to my attention. The difference between them was so striking I found them quite instructive in relating efficiency, human contact and the customer experience.
A customer wanted to close a credit card as they continue their transition to pure mobile banking. The customer sent a letter informing the bank they do not wish to renew the card past its annual expiration date. The card carries an annual charge.
As the customer put it, “I knew from the beginning that something would go wrong. I wasn’t disappointed. The customer was charged half the annual fee despite their request to let the card expire. As he said, “I can't help it - my blood pressure increased a little.”
He called his personal banker. She immediately promised that she is presently canceling the charge, and thinks that the conversation is over. The customer pressed further to understand the cancelation process. The banker blamed others for failure to execute, spoke of an unclear process and couldn’t really explain what’s actually happening.
Sixty days later, the charge has not been canceled.
In sum: a bad experience.
Israel has introduced biometric passports which make entry and exit into the country extremely easy and quick. My passport was issued by the Israeli consulate in the US, and cannot be converted into a biometric document. Consequently, Dick had an easier time entering the country than I did. So, with great trepidation, I resolved to have a new biometric capable passport issued while in Israel.
My past experiences with any government agent in any country have been terrible to horrible. I expected no different. The agency’s website offered an appointment setting feature, which I used. On the appointment date we went to the Ministry of the Interior. Shockingly, the appointment has taken place on schedule, and took 10 minutes to complete. The government agent told me the passport will be delivered to the post office within three weeks. We got the notice it was there after a week, with a link to a delivery service a-la Uber. I clicked the link, and 20 minutes later a motorcyclist showed up with the document, matched the code I was send with the code on his device and delivered the passport.
In sum: a great experience, far exceeding expectations.
Both experiences cause me much reflection. The first one was relationship-driven, with a personal banker involved, but it was frustrating and unsatisfying. The banker was uncaring and incapable. The second experience was highly automated, and the person handling the front-end of the interaction was an average order-taker, but the technology end of the entire process was powerful and extremely positive. Instead of the torture of waiting in the interminable line at the post office, a single click on a link and a $10 expense brought the document directly to me.
The learnings are numerous:
• Customer expectations from banks’ personal service are low, but even those aren’t always met
• Bank staff should create value-add to a fully-automated solution, rather than detract from it
• Human contact can be indifferent (like at the Ministry of Interior), negative (like at the bank) or value-add positive (like a waiter making a wise dish recommendation). It is important to leverage the resource to create a positive, unique and personal experience that cannot be effectively replaced with a technology solution
• Exceeding customer expectations using any channel is highly impactful
The passport example shows how the technology used improved both short-and long-term efficiencies for both the customer and the service provider (in this case the Israeli government). The customer could use self-service going forward, as well as reduce wait times, and the service provider could reduce headcount while positively impacting the customer experience. The benefits will accrue, and remind both sides of their existence, every single time the customer enters or leaves the country. It is a perfect win-win situation.
It also shows how important is the seamless collaboration of the person with the technology. Because there is a backstage story behind the scenes. You dealt with screens when it came to the delivery service, which made it seem that machines carried the process from A to Z. Certainly people made the process work. Even the motorcyclist played an important role in the process. It is those people who are efficient, together with the computers and other machines, who make all the difference. For example, the delivery motorcyclist showed up in 20 minutes while being tracked by the delivery app. It means that he went to the post office, collected the passport as quickly as possible (as he was tracked), then started driving without delay. He didn't answer his phone though it was a very good friend who was calling, didn't stop to drink a coffee at the bar, and didn't accept to do another delivery on the way. He did exactly what he was supposed to do, by those who imagined the process.
Banks will benefit from identifying similar situations and processes in their own shops, and developing technological solutions to achieve long-term efficiencies coupled with customer well-being. For example, why not provide a delivery service link to all new credit and debit card issued through the branch? It will certainly be less expensive than instant-issue machines, will require less compliance-related and security-related procedures, and will give the customer the option to receive the cards sooner without having to go to the branch or wait for the usual 7-10 days to receive the card by mail. Plus, the customer could activate the card sooner and start using it, generating interchange income in the process.
This is but one example, built directly on the experience I shared. Your teams can come up with many more and better ideas. Start with the customer’s view, and develop a solution that will exceed their expectations while reducing your cost to deliver your basic services. It’s a beautiful thing!
New in the Nest:
This column will offer fool proof recipes, restaurant suggestions and other foodie tidbits for your consideration and consumption.
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