Skip to main content

Customer Support as a Strategic Asset: Shifting the Paradigm from Cost to Value



In the financial sector, a significant number of employees work in the Customer Support (Customer Care) department. However, blogs about the financial (Fintech) sector often overlook this department, focusing instead on sales and IT.

Instead Customer Support departments are often considered as necessary costs (a cost center) that should be minimized as much as possible.

This results in continuous neglect and relentless cost-cutting measures in those departments. E.g.

  • Outsourcing to near- and off-shore countries

  • Structural understaffing, leading to awfully long waiting times for customers.

  • Low salaries, resulting in hiring profiles with little experience and expertise.

  • Bad and difficult working circumstances, like

    • Setting targets on Average Call Time, creating pressure to quickly close calls.

    • Leaderboards based on the number of calls processed, fostering competition among team members.

    • Monitoring and limiting break times

    • Encouraging multitasking during no-call time (for other occupations, like answering mails, social media, chat boxes…​), which requires continuous context switching and reduced focus.

  • Complex IVR menus that aim to automate and streamline processes, but often lead to a poor customer experience.

  • Maximizing automation through standard templates (to reply to mails and phone calls), the setup of chatbots, forcing customers to use self-service options…​

These measures ultimately contribute to a bad customer experience, leading to customer churn, negative social media feedback…​

Considering the growing importance of customer centricity, this situation is probably not sustainable, as in the long-term it leads to bad business results. Clearly delivering exceptional customer service has become a key competitive differentiator, and therefore shifting the paradigm is crucial.

In a customer-centric organization, the Customer Support department should emerge as a cornerstone in serving and delighting customers. Increasingly financial service players are therefore recognizing the value of Customer Support teams as profit-centers, that positively impact customer satisfaction and brand loyalty.

In this trend, we see the opposite movement of the measures taken above, i.e.

  • Re-insource Customer Support departments, considering them as a core, strategic competence/function for the company.

  • Increase headcount (i.e. foresee sufficient staff) to reduce waiting times (ensuring swift issue resolution), increase the time spent on every customer interaction (focus on satisfaction of the customer in the customer support interaction, rather than a quick completion) and to improve work conditions.

  • Hire better profiles and provide sufficient training and support.

  • Prioritize direct customer interactions over indirect or automated interactions. E.g. certain companies have already adopted a policy of answering every question via a phone call and not by a written reply. By adopting this practice, they have significantly increased customer satisfaction, but were also able to identify countless new cross-selling opportunities.

  • Grant more responsibilities and autonomy to Customer Support resources, allowing them to cross-sell products, identify potential customer issues (i.e. identify churn), survey and understand customers, and proactively contact customers.

  • Recognize Customer Support teams as ambassadors of the organization and as salespeople, encouraging them to go above and beyond to exceed customer expectations.

  • Leverage the deep understanding of customers' needs, preferences, and pain points possessed by Customer Support departments.

By implementing these measures, organizations acknowledge the value of existing customers as valuable assets. Customer Support teams play a central role in building and nurturing long-term relationships, ensuring customer satisfaction, and fostering loyalty. Additionally, they become a valuable resource for gathering market insights and understanding the perception of existing products, potentially replacing complex and costly (often external) surveys and market studies.

So next time a Product Manager wants more info about the market or about the customer perception of an existing product, maybe worth to visit first the Customer Support department, before organizing complex and costly surveys and market studies.

Check out my other blogs on https://bankloch.blogspot.com/

Comments

Popular posts from this blog

Transforming the insurance sector to an Open API Ecosystem

1. Introduction "Open" has recently become a new buzzword in the financial services industry, i.e.   open data, open APIs, Open Banking, Open Insurance …​, but what does this new buzzword really mean? "Open" refers to the capability of companies to expose their services to the outside world, so that   external partners or even competitors   can use these services to bring added value to their customers. This trend is made possible by the technological evolution of   open APIs (Application Programming Interfaces), which are the   digital ports making this communication possible. Together companies, interconnected through open APIs, form a true   API ecosystem , offering best-of-breed customer experience, by combining the digital services offered by multiple companies. In the   technology sector   this evolution has been ongoing for multiple years (think about the travelling sector, allowing you to book any hotel online). An excelle...

IoT - Revolution or Evolution in the Financial Services Industry

1. The IoT hype We have all heard about the   "Internet of Things" (IoT)   as this revolutionary new technology, which will radically change our lives. But is it really such a revolution and will it really have an impact on the Financial Services Industry? To refresh our memory, the Internet of Things (IoT) refers to any   object , which is able to   collect data and communicate and share this information (like condition, geolocation…​)   over the internet . This communication will often occur between 2 objects (i.e. not involving any human), which is often referred to as Machine-to-Machine (M2M) communication. Well known examples are home thermostats, home security systems, fitness and health monitors, wearables…​ This all seems futuristic, but   smartphones, tablets and smartwatches   can also be considered as IoT devices. More importantly, beside these futuristic visions of IoT, the smartphone will most likely continue to be the cent...

RPA - The miracle solution for incumbent banks to bridge the automation gap with neo-banks?

Hypes and marketing buzz words are strongly present in the IT landscape. Often these are existing concepts, which have evolved technologically and are then renamed to a new term, as if it were a brand new technology or concept. If you want to understand and assess these new trends, it is important to   reduce the concepts to their essence and compare them with existing technologies , e.g. Integration (middleware) software   ensures that 2 separate applications or components can be integrated in an easy way. Of course, there is a huge evolution in the protocols, volumes of exchanged data, scalability, performance…​, but in essence the problem remains the same. Nonetheless, there have been multiple terms for integration software such as ETL, ESB, EAI, SOA, Service Mesh…​ Data storage software   ensures that data is stored in such a way that data is not lost and that there is some kind guaranteed consistency, maximum availability and scalability, easy retrieval...

AI in Financial Services - A buzzword that is here to stay!

In a few of my most recent blogs I tried to   demystify some of the buzzwords   (like blockchain, Low- and No-Code platforms, RPA…​), which are commonly used in the financial services industry. These buzzwords often entail interesting innovations, but contrary to their promise, they are not silver bullets solving any problem. Another such buzzword is   AI   (or also referred to as Machine Learning, Deep Learning, Enforced Learning…​ - the difference between those terms put aside). Again this term is also seriously hyped, creating unrealistic expectations, but contrary to many other buzzwords, this is something I truly believe will have a much larger impact on the financial services industry than many other buzzwords. This opinion is backed by a study of McKinsey and PWC indicating that 72% of company leaders consider that AI will be the most competitive advantage of the future and that this technology will be the most disruptive force in the decades to come. Deep Lea...

An overview of 1-year blogging

Last week I published my   60th post   on my blog called   Bankloch   (a reference to "Banking" and my family name). The past year, I have published a blog on a weekly basis, providing my humble personal vision on the topics of Fintech, IT software delivery and mobility. This blogging has mainly been a   personal enrichment , as it forced me to dive deep into a number of different topics, not only in researching for content, but also in trying to identify trends, innovations and patterns into these topics. Furthermore it allowed me to have several very interesting conversations and discussions with passionate colleagues in the financial industry and to get more insights into the wonderful world of blogging and more general of digital marketing, exploring subjects and tools like: Search Engine Optimization (SEO) LinkedIn post optimization Google Search Console Google AdWorks Google Blogger Thinker360 Finextra …​ Clearly it is   not easy to get the necessary ...

Low- and No-code platforms - Will IT developers soon be out of a job?

“ The future of coding is no coding at all ” - Chris Wanstrath (CEO at GitHub). Mid May I posted a blog on RPA (Robotic Process Automation -   https://bankloch.blogspot.com/2020/05/rpa-miracle-solution-for-incumbent.html ) on how this technology, promises the world to companies. A very similar story is found with low- and no-code platforms, which also promise that business people, with limited to no knowledge of IT, can create complex business applications. These   platforms originate , just as RPA tools,   from the growing demand for IT developments , while IT cannot keep up with the available capacity. As a result, an enormous gap between IT teams and business demands is created, which is often filled by shadow-IT departments, which extend the IT workforce and create business tools in Excel, Access, WordPress…​ Unfortunately these tools built in shadow-IT departments arrive very soon at their limits, as they don’t support the required non-functional requirements (like h...

The UPI Phenomenon: From Zero to 10 Billion

If there is one Indian innovation that has grabbed   global headlines , it is undoubtedly the instant payment system   UPI (Unified Payments Interface) . In August 2023, monthly UPI transactions exceeded an astounding 10 billion, marking a remarkable milestone for India’s payments ecosystem. No wonder that UPI has not only revolutionized transactions in India but has also gained international recognition for its remarkable growth. Launched in 2016 by the   National Payments Corporation of India (NPCI)   in collaboration with 21 member banks, UPI quickly became popular among consumers and businesses. In just a few years, it achieved   remarkable milestones : By August 2023, UPI recorded an unprecedented   10.58 billion transactions , with an impressive 50% year-on-year growth. This volume represented approximately   190 billion euros . In July 2023, the UPI network connected   473 different banks . UPI is projected to achieve a staggering   1 ...

A bank account - A concept of the past

Almost every recent article written about banking starts with the statement that the   banking industry is being disrupted   by new competitors, new innovations and new technologies. Although this statement is definitely true, the extend of the disruption can still be debated. Even the most innovative neo-banks still work with bank (current, saving, term and investment) accounts, cards (credit and debit), traditional credits, existing payment infrastructure…​ The user experience surrounding the origination and servicing of these products has dramatically improved (and will continue to evolve), but the underlying banking products are not really disrupted. You could argue that banking products are so intertwined with society and our way of thinking about finance, that they can’t be disrupted, but looking at those products you cannot ignore that they are far from an optimal solution in our current digital world. Let’s consider   cards   for example. Isn’t ...

The Freemium Model in SaaS: A Smart Acquisition Play or a Costly Gamble?

In the world of SaaS, the freemium model has become a widespread customer acquisition strategy. The premise is simple: offer a free version of your software to attract users and then convert a portion of them into paying customers. The classic tagline — "Start for free, upgrade as you grow" — perfectly encapsulates this approach. But while the model sounds straightforward, the reality is more complex. Freemium is not just a pricing strategy; it is a calculated bet with significant costs. Companies must carefully balance acquisition, conversion, and infrastructure expenses to make freemium a sustainable growth engine rather than a financial sinkhole. Freemium offerings come in different flavors, each designed to balance value for the user with a strong incentive to upgrade: Unlimited free usage with restricted features The core product is free, but premium features (often essential for corporate users) require payment. This flavor is common in open-source solutions, where ente...

From app to super-app to personal assistant

In July of this year,   KBC bank   (the 2nd largest bank in Belgium) surprised many people, including many of us working in the banking industry, with their announcement that they bought the rights to   broadcast the highlights of soccer matches   in Belgium via their mobile app (a service called "Goal alert"). The days following this announcement the news was filled with experts, some of them categorizing it as a brilliant move, others claiming that KBC should better focus on its core mission. Independent of whether it is a good or bad strategic decision (the future will tell), it is clearly part of a much larger strategy of KBC to   convert their banking app into a super-app (all-in-one app) . Today you can already buy mobility tickets and cinema tickets and use other third-party services (like Monizze, eBox, PayPal…​) within the KBC app. Furthermore, end of last year, KBC announced opening up their app also to non-customers allowing them to also use these thi...