Bridging the customer experience gap

The prevailing view of most financial industry leaders over the past decade has been that internal innovation was optional at best, and probably harmful to the way they’ve been used to doing things for so long. Meanwhile, innovation bloomed on the edges and outside of the industry, bringing a surge in customer adoption in fintech, which has brought a flood of investor equity in turn. Financial leaders are finally starting to pay attention.

Sort of.

It’s certainly not a moment too soon, as today’s consumers who live their lives in a world defined by the customized and engaging customer experiences of Apple, Uber, Google, Netflix, Starbucks, Amazon, and others sense a major disconnect when interacting with their financial institution. Back to the future, indeed.

I spent last week in Singapore at the massive global banking conference Sibos, and while I was surprised at the number of bankers who insisted on wearing suits and ties at a luxury resort in the tropical heat and humidity, I was encouraged by the throngs of suits who overwhelmed the Innotribe sessions.

Innotribe has been the embedded rebel camp at Sibos since 2009, but this year a large swarm of new faces joined the familiar bunch of casually-clad denizens, which included a veritable who’s who of fintech entrepreneurs, innovators and influencers far too numerous to mention here (check Twitter).

From Big Data to value data

My colleague Jay van Zyl, Founder and Chairman of Innosect, presented to an overflow crowd on Voice of the Customer 3.0, how artificial intelligence, crowd-intelligence, graph intelligence, and human intelligence are all converging, and how that convergence can be harnessed to create a truly personalized and relevant customer experiences. (You can watch the video on YouTube here, Jay’s portion starts about 39:00)

Jay talked about our research into the U.S. Consumer Financial Protection Bureau consumer complaint database on banking services. We found some interesting geographic differences in the data, and we are applying a computational social science approach to mapping this data against other multi-dimensional data to paint a more vivid picture of evolving customer wants and needs. We’ll be publishing the results of our research in the coming weeks, butemail me if you are interested in a customized evaluation of this data for your financial institution.

There is a treasure trove of information available there and it is amazing that we continue to talk to senior banking leaders who have never spent time with the data. It seems that many consider it the domain of the compliance department, or maybe customer service, but not enough are using it to help tailor their products and services to improve the customer experience.

There is an overwhelming amount of data out there— big data, little data, structured data, unstructured data, transactional data, social data— but the key is making sense of it in the context of your business plans and in the markets in which you are operating. That’s what we call Value Data.

Fintech becoming mainstream?

Besides all the new faces at the Innotribe sessions, I’ve experienced similar new interest in my own talks on the rise of fintech and the need for more innovation in banking. I attended a banking industry conference a couple years where I experienced mostly ignorance and indifference to the topic, so I stopped attending. This year the group’s new CEO invited me to keynote in a featured slot on their main stage.

Earlier this year I also taught the first class ever on innovation and fintech at the Pacific Coast Banking School at the University of Washington. The class was fully booked in short order, so a second section was offered and it too was fully booked. The students were largely unaware of many fintech developments over the past few years, but they were deeply engaged in learning more and figuring out how to apply the lessons in their own banks.

This widening interest is not just in my imagination. Look at the trend line of Google searches on the topic “Fintech”:

Fintech Next week I’ll join 10,000 of my closest friends in Las Vegas for Money 20/20, where fintech and innovation in financial services are certainly not new words. I’ll also be with some of my clients at Capital One and Capital One Growth Ventures, so we’ll also take an inside look at how they’re investing in fintech and innovation in banking. Stay tuned for more details on that.

The good news, for now, is that more and more banking leaders are recognizing that the world is changing around them, the bad news is that most are not prepared to move quickly enough to close the ever-widening gap.

As General Eric Shinsecki, former Chief of Staff of the U.S. Army said, “If you don’t like change, you’re going to like irrelevance even less.” 

This article originally appeared here. Republished with permission. Submit your copyright complaints here.

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JP Nicols

Bank innovation consulting expert JP Nicols has been internationally recognized as a leading voice for innovation, strategy and leadership for the future of financial services.

JP is a trusted advisor to companies from startups to the Fortune 500, a popular writer, a top rated speaker, and is often quoted in the press on video and in print. He has been named to several lists as an influential thought leader in financial services.

A former senior bank executive, JP is the President and Chief Operating Officer of Innosect, a Silicon Valley based global innovation enablement and analytics company that has experience helping over 200,000 people contribute to projects and campaigns that have generated over $400 million in value.

He is also the co-founder of the Bank Innovators Council, an independent global membership organization with members in 65 countries that promotes and supports innovation in banking.

His work has been featured in some of the industry’s top publications, including American Banker, The Financial Brand, BAI Banking Strategies, Investment News, Bank Innovation and many others. Read more here.

Before his work in bank innovation consulting, JP served in various leadership and innovation roles at top financial institutions, including as the first Chief Private Banking Officer for a top five U.S. bank. He is an instructor at the Pacific Coast Banking School, and he serves on the advisory boards of NextBank USA and Advizr, and previously served on the advisory board of Balance Financial and as Vice Chair of the board of Forest Ridge School of the Sacred Heart.