Customer experience in wealth management

In a recent circular (Selling of Investment Products to Private Banking Customer, 12 June 2012) to the chief executives of financial institutions in Hong Kong, the Hong Kong Monetary Authority (HKMA) clarified some of the issues raised by the Hong Kong private banking community about the "compliance and regulatory" requirements related to the selling of investment products to high net worth individuals. Similarly, the Monetary Authority of Singapore (MAS) (26 Mar 2012, "Role of Life Insurance and Financial Advisory Services" by Managing Director, Ravi Menon), highlighted the importance of "placing the customer first".

These two recent announcements highlighted the increasing regulatory pressures placed on Asia's wealth managers to raise the standards of the advisory processes when servicing their wealthy clients. Given these challenges, the paradox of a customer experience goes against the notion that clients' needs are different and require tailored solution and services.

Customer experience does not solely lies on the final product or service that the client receives. The consistent effective delivery of a product/service to the client is the essence of customer experience. The development of a customer experience strategy needs to take into account the following.

Vision
1)  Having a clear vision and mission
Customer experience is a process of how an organization should consistently deliver a quality product/service to the client. Starbucks and Amazon are two great examples how customer experiences are delivered to the customer consistently. The products may be different across different region/countries, but the process in which the client request and receipt of the final product and service is very much consistent and predictable.

Wealth managers must have a clear vision and mission about what customer experience meant for them. One wealth manager that I know defines customer experience as a consistent and predictable advisory process where clients, regardless of which branch they visit or which RM they meet , will receive a consistent service that results in a product or service that is aligned with their risk profile and wealth planning needs.
 
2) Articulating a clear vision across the organization
Executing a successful customer experience strategy requires a clear understanding across the verticals and horizontals of the organization. Executing a customer experience strategy is not limited to those who meet or service the customers only. The middle and back office organizations are required to align with the front-office. For example, for sales team which service wealthy families and individuals, servicing requirements can be different. Understanding these differences and its impact reinforce the consistency of product and service delivery.

Channels and Technology

3) Aligning the channels strategies
Relationship manager is not the only channel that client interacts with the institution. Identifying the channels (such as internet, branch and helpdesk) and aligning their corresponding strategies with the customer experience strategy are critical for a successful implementation.

4) Impact of new technologies

The use of social media and the rapid adaptation of smartphones and tablets by RMs need to be further researched and understood to support the delivery of a consistent customer experience. The use of tablets and electronic forms to obtain clients signatories and provide online submission without handling multitude of physical forms for investments/compliance reasons serve to create a unique customer experience whilst enhancing efficiency and service standards.

Business Processes

5) Business Process Redesign
Any customer experience implementation cannot go without a review of existing business processes across the organization. However, any business process redesign should not focus on just efficiency alone. The use of LEAN or Six Sigma tools should not be used as a standalone methodology to execute a customer experience strategy. In addition to efficiency, wealth managers must take into account of the following during the redesign:

a) Customer Life Cycle
At every stage of a customer life cycle, such as prospect, a new customer, active customer and an exiting customer, customer experience must be embedded in the respective business areas and processes. This includes areas like client on-boarding, needs analysis, investment proposal/execution/review, wealth planning, just to name a few.

b) Customer Segmentation
Customer segmentation in the wealth management is critical to maximize profitability, raise ROA (Return on Assets) and efficiency. However, it is critical to apply a consistent business processes across the different customer segments even though individual tasks/activities can be variant.

c) Regulatory/Compliance
Wealth managers must continue to address the issues of risk profiling, client and investment suitabilities, KYC and AML. It is critical that these issues are addressed and incorporated into the business processes. Regulatory and compliance should not be isolated and treated as separate areas outside the scope of customer experience.

At the end of the day, executing a customer experience strategy is the beginning of a customer experience journey where the organization truly places the customer at the heart of the organization.

After working through several crises, here are my three secrets to career-planning success

It has been widely reported that Credit Suisse is moving part of its back-office operations from Singapore to cheaper locations like India and Poland. Job cuts are very much a reality of globalisation and economic cycles. Given this, career planning in financial services has never been more important.
Having been in the financial industry for over a decade, I have experienced crises like the dot-com bust, 9/11, SARS and the global financial crisis firsthand. Career planning demands a multi-faceted approach. It’s a strategic exercise involving both the external environment (growth and threats) and the internal (individual weaknesses and strengths).
Most of us are conscious of our own weaknesses and strengths. There are many corporate and government programmes that support employees in undertaking personal development plans. These are usually aimed at raising your productivity and increasing employability. However, assessing the external environment is an exercise not many of us do too often.
Career planning should always take into account the firm’s financial performance, its business strategies/goals and the general industry outlook. Here are my tips for mapping out a successful career in financial services:

1) Scratch beneath the surface

First, a proper understanding of the business environment facilitates the identification of trends and opportunities. For instance, some people assumed the sector suffered from huge cuts across all business segments after the financial crisis. This certainly wasn’t the case. For example, in the wealth management sector, family offices and external asset management companies experienced moderate to robust growth as a result of wealthy families and individuals switching their relationships away from private banks.

2) Exhaust your internal possibilities

Within a firm, various business functions grow at a different pace. While cuts go on in one area, expansion could continue in others. Internal transfers and overseas postings offer opportunities to advance your career and can provide a fresh perspective. If mobility opportunities are limited, seek out internal projects. These offer you the chance to understand and learn new processes and systems in preparation for the next wave of growth.

3) Get very social both within and without

It used to be difficult to connect to financial professionals within your current firm or externally in other financial institutions. However, with the onset of sophisticated professional social networking tools, it is now easy to reach out to your peers, not just within your country or region, but globally. These professional connections allow you to anticipate key changes and provide access to career opportunities. With a clear understanding of the industry and the right networking tools, exciting prospects for career progression are yours for the taking.


This article is re-posted in www.eFinancialcareers.sg