Customer is king

Consumer Relationship Management to empower dynamic bankers

In today’s ever changing world of business and finance, financial service companies find themselves grappling with how to build on their CRM capabilities to accommodate an ongoing increase in the standard of excellence in customer management.The Institute of Bankers, together with Microsoft Sri Lanka has taken initiative to address this issue at a seminar to be held exclusively for members of the Institute of Bankers of Sri Lanka (IBSL) and the Association of Professional Bankers Sri Lanka.

The objective of this seminar will be to highlight the need for a CRM process in banking and introduce to the audience the broader benefits that can be derived from adopting a CRM process. This seminar will be part of the Continues Professional Development (CPD) program of the IBSL for its AIB and FIB holders.

Customer Relationship Management (CRM) is a broad approach for creating, maintaining and expanding customer relationships. It is the business strategy that aims to understand, anticipate, manage and personalize the needs of an organization’s current and potential customers.

CRM in banking is entirely different from other sectors, because this industry purely relates to financial services, which needs to create the trust among the people. Establishing customer care support during and off official hours, making timely information about interest payments, maturity of time deposits, issuing credit and debit cum ATM cards, creating awareness regarding online and e-banking, adopting mobile requests etc., are required to keep regular relationship with customers. All these can be achieved through a well thought through and carefully designed data gathering and profiling process, such as a CRM.

CRS also creates a sustainable competitive advantage by being the best at understanding, communicating, and delivering and developing existing customer relationships in addition to creating and keeping new customers. More importantly, to adopt CRM successfully, organizations must transform into a more customer centric business. This requires a paradigm shift in the organization with an understanding on how well the business is equipped to comprehend, internalize and implement the changes.

During the past two decades, the environment within which the banks operate has changed rapidly due to globalization, technology revolution, developing communication modes, intensifying the competition in the banking industry.  As a result, the array of financial products and services has been broadened.  Many efficient delivery and processing channels, and innovative products and services have been developed, enhancing easy access to finance these new requirements. The introduction of Automated Teller Machines (ATMs), Electronic Fund transfers at the Point of Sale (EFTPOS), Electronic Banking facilities such as Internet Banking and Telephone Banking, Debit card, Credit card and Traveler’s cards are a few notable features, which increased wide accessibility of banking services in the industry.      

In addition customers themselves have become more knowledgeable, sophisticated, and assertive. Their demands include flexibility in hours of operation, greater convenience, customization in products and services, user friendly IT facilities, transparency in transactions, wider accessibility, control and secured operations, personalized, friendly service etc.   In this customer-centric business environment, attracting and retaining the customers in the long-run has become a key challenge for the banks.  This has led to a shift in the business focus in the modern banking environment from ‘transactional marketing’ to ‘relationship marketing’.  CRM processes help the financial institutions to manage their customers efficiently and effectively in this regard. The objective of banks introducing CRM is to build and maintain profitable customer relationships by delivering superior customer value and satisfaction, in order to enhance customer loyalty and retention.

CRM applications that are integrated with the core-banking systems can bridge the information gap and provide the higher level functionality, analysis and insights that a dynamic banker would need in providing superior quality customer service. A fully integrated CRM system can provide many benefits to a bank, to gain a competitive edge in the modern banking environment.