Archive for the ‘TD’ Tag

Delivering the omni-channel experience

New technology-based “channels” are giving firms the opportunity to more deeply interact with customers.  However, adding new channels to a traditional business can trigger marketing misalignments, internal strife and significantly higher cost.  Managers who can overcome these challenges to deliver an omni-channel experience can grow revenues, enhance customer value and improve margins.

A channel can be any intermediary between a customer and the manufacturer of a product or service. Traditional channel partners include retailers, outsourced call center and wholesalers.  New channels – handheld devices, apps and soon, wearable computers – are enabling a host of activities including mobile commerce, information gathering and social interaction. Entering this brave new world poses significant risks for a company.  Consider these three areas:

  1. Marketing

Programs designed for different channels can easily work at cross purposes, leading to reduced marketing efficiency and effectiveness.

  1. Information Technology

Adding new technology to heterogeneous infrastructures is not simple or inexpensive.  Furthermore, channel must operate reliably and securely across different platforms, networks and geographies.

  1. Organization

Channel managed in divisional silos hinders operational integration and drives up complexity, resulting in higher administrative costs and conflict.

All of nothing

To overcome these challenges, many firms are pursuing an Omni (meaning “all” or “every” in Latin) Channel strategy, whereby all sales and support channels work synergistically to seamlessly deliver a firm’s brand promise to each customer segment. In turn, the operating and IT model is organized to deliver on a consistent experience at every customer interaction.

A way forward

Some companies we have researched are meeting the omni-channel test – but many are not.  Successful firms recognize the strategic importance of their channels and share some key attributes, including:  a customer-centric philosophy; an emphasis on organizational and technical integration and a collaborative mind set inside and externally.

New software can help enable customer centricity across every channel.  As an example, NexJ Systems, a leading software provider, developed an enterprise-wide solution that gives managers the information and tools to manage all their channels for maximum performance.  According to CEO and Founder Bill Tatham, “At one of our large insurance customers, a single view of the customer and every interaction with that customer is shared by head office, the contact center and the field agents, allowing collaboration in selling and customer value maximization.”

One firm that is getting it right is TD, which is no small achievement in the complex retail banking space. At the core of TD’s effort are three key principles:

  1. Put the customer first

TD launches and manages channels & services based on what the customer wants, not just what their technology can provide.  The firm receives a daily flow of usage data across each channel generating real time insights on a user’s behaviour as well as needs states.   This customer-centric philosophy ensures each channel maximizes the value delivered at the lowest possible cost.

  1. Have a supportive organization

TD understands that consistent leadership, a clear ethos and engaged workforce can make or break the omnichannel experience. Their unique “Better Bank” culture emphasizes continuous improvement, collaboration and a longer view of program payback.  TD’s digital channels are not managed as siloed businesses.  Instead, they reside in a horizontal, enterprise-wide structure, which helps drive marketing & operational integration, rapid execution and higher system ROI.

  1. Be bold but implement prudently

Though keen to adding new technology, TD takes a prudent approach to introducing new services.  The Company adopts an end-to-end operating view and a “continuous improvement” approach to designing and implementing the right technology.  Before launching any capabilities, multi-functional teams carefully evaluate their options and select the ones that best fit their brand and IT strategies.

“Customers want us to know them, and we’re continually evolving our notion of convenience to make their journey with us more comfortable, no matter when, where or how they choose to bank with TD,” says Teri Currie, Group Head, Direct Channels, Marketing, Corporate Shared Services and People Strategies. “We are leveraging TD’s strong North American brand and scale to develop connections with our customers by focusing on their needs, looking specifically at their journey with us to understand how we can make their lives better.”

TD’s approach is working.  The Company is rated number one in customer satisfaction (according to J.D. Power) among the Big 5 Canadian Banks for In-person, ATM, Online, Automated and Live Phone.  This accomplishment is not merely a function of the company’s strong bank network.  TD is also number one Canadian bank for mobile banking according to Commscore.

Providing an omni-channel customer experience can generate significant rewards, though it might not be an easy journey.  Nonetheless, managers have little choice. In a low growth world, failing to prioritize an omni-channel strategy can result in missed growth opportunities, higher customer attrition and increased operating costs.

For more information on our services or work, please visit the Quanta Consulting Inc. web site.

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Banking goes digital

The banking industry is changing, whether it likes it or not. In the past, the business was driven by capital-deployed, risk-management competencies and branch coverage. The financial meltdown of 2008, however, changed much of that. The sector now features low growth, increased regulations and leverage limits. To make matters more complex the emergence of digital technologies is transforming the way customers want to deal with banks and opening up market opportunities for aggressive and focused competitors. Increasingly, banks will need to address this “new normal“ by enabling their customers with “any time, any place” digital capabilities and capitalizing on Big Data insights that come from mining the reams of daily customer and operational interactions.

Despite the rise of transformational technologies, bankers in 2014 run their businesses pretty much as they did in 2008. Most of the executives we speak with continue to hope that traditional profit drivers — high fees, exchange-rate volatility and a growing economy — reassert themselves. However, hope is not a strategy especially when consumer behaviour has fundamentally changed.

The arrival of mobile computing, social media, digital payments, and web-based, face-to-face communications like Skype have radically changed the way people buy products and interact with organizations. Not surprisingly, these technologies have created opportunities for disrupters to enter the sector with low-cost, focused offerings unencumbered by legacy business models. In the United States, for example, Walmart has introduced reloadable pre-paid offerings that act like checking accounts. PayPal and Bitcoin are now enabling payments outside the banking system. Covestor links individual investors with portfolio managers who meet their investment needs.

It is bewildering how slow many financial institutions have been in adopting digital technologies and exploiting Big Data, compared to other industries. For example, while music stores, electronics stores, and other retailers have reduced or even eliminated physical distribution, large banks have expanded it. Many blue-chip firms like Cisco, Walmart and IBM already employ Big Data and mobile strategies to deliver new services, streamline their operations and reduce cost. If banks want to compete better and protect their franchise, they need to act more like mobile and digitally driven competitors like Apple, Google and Facebook — who not incidentally command much higher market capitalizations.

TD recently identified digital transformation as a corporate priority, and built capabilities back from the customer’s needs and desired online experience. “When we’re working on new online or mobile banking features, we put ourselves in the customer’s shoes to see things from their perspective, says Rizwan Khalfan, senior vice-president, digital channels, TD Bank Group. “We know customers are quick to adopt new ways to bank that make managing their finances simpler. It’s not just about paying a bill on your mobile, it’s about creating a great customer experience across all our distribution channels.”

Prudent bankers are starting small, testing extensively and then boldly scaling. Khalfan says, “When we launched the ability to deposit cheques using your mobile phone in the U.S., we spent time perfecting the little features that will make it an overall better experience. We know it’s hard to hold your phone and take a photo by pressing a small button, so on our app, customers can press any part of the screen to take a photo of the cheque and the photo won’t be taken until the camera has focused properly. We’ll be leveraging those learnings when we roll out that capability in Canada later on this year.”

Across the pond, British bank Barclays is taking a bold approach to digital transformation. Its strategy is to use technology to get closer to customers and simplify their lives. In order to become the “Go-To Bank” for consumers, the firm rapidly launched some breakthrough services like Pingit (Euorpe’s first mobile payment app) and CloudIT (a cloud-based service that allows consumers to store documents and photos online). When launching Pingit, Barclay’s dispensed with their traditional multi-year business case. Mike Walters, head of UK Corporate Payments, was recently quoted in The Economist as saying: “The rate of change in mobile app technology is so fast that the best thing for us is to be aware of our customer trends, and then be fast to execute.”

Without a sustained top-down commitment, change won’t come easy or quickly. Traditional business and IT models, low digital literacy among many executives and a risk-averse culture will slow down digital adoption in some areas. Yet, bankers don’t have a choice if they want to protect their franchise and find new avenues of growth. They would be would be wise to heed the words of well-known British philosopher Allan Watts: “The only way to make sense out of change is to plunge into it, move with it, and join the dance.”

For more information on our services and work, please visit the Quanta Consulting Inc. web site.