Thinking Outside-In – Insights from Backbase CEO Jouk Pleiter
I spend a lot of time at Backbase asking this question: Why is it so difficult for financials to truly engage with their customers? In doing so, I’ve come to a couple of conclusions. The first is the lack of an ‘outside-in’ – or customer centric – perspective. This is the main culprit in my opinion. It is closely followed by an inability to align different internal groups within the bank (e.g. channels, product management and IT) to collaborate effectively in the best interest of the customer.
Financials are often preoccupied with navel gazing. This gazing takes the form of a relentless product focus and it results in product pushing. I recently spent time at a large European bank and again was confronted with the sheer number of products being thrust at the customer from every channel. This push mentality, I’m afraid, is still alive and well industry-wide and it’s not very engaging or customer centric.
More and more, customers are voicing their dislike for product pushers. What the customer really wants, and is in fact requesting, is ease and simplicity. It’s their unique, personal needs that the customer wants met. So, how can a bank stop this ineffective, inward thinking? Instead of making business decisions by looking at their own needs (the classic inside-out mistake), they can instead take the customer’s perspective. This outside-in approach means asking: How can we make things easier and more transparent? How can we really help the customer and build a long-term, trusted relationship? Yet, for this to happen, and change to occur in a real way requires a fundamental, top-down change of perspective — a complete company overhaul with the end goal being to develop customer-centric thinking.
Additionally, the issue of department thinking and silo’d or ‘trapped’ data has kept many financials from using the valuable in-house information they have about customers that could give them the kind of personal, engaging relationship both parties so much desire. Banks are in fact sitting on mountains (silos) of important and useful bits of data about customers that if handled and accessed properly could result in the kind of personalized products customers want and will pay for.
The world has definitely changed post-economic crisis and customers are now more self-directed than they’ve ever been. This lends even more urgency to a change in industry thinking. As Accenture mentions in a recent study titled, Customer 2012: Time for a New Contract Between Banks and Their Customers?, “There is a fundamental power shift [happening] from banks to consumers.” I believe with this shift lies opportunity; the chance for financials to get it right. It means they can develop outside-in thinking and give their customers what they want. If banks can give customers value for money, the ability to choose independently among products, and pro-active advice based on real actionable information – then they will have a shot at making their customers feel understood and keeping them around for the long haul.