“Banking is necessary; banks are not”
The quote of Bill Gates is somehow correct but also irritating. Banks have to change, and it depends on the willingness of an institution to change. If it does not do it, this quote makes total sense.
Service design for financial services has helped over the last years to transform financial services fulfilling this willingness for change.
Financial services are not intermediaries that do nothing between a service and a service consumer. They offer something—authentic products and services that can make perfect sense for their customers if they fit their actual needs.
What’s happening in the customer- and employee-side of financial services?
The rise of fintech for some years has made financial services begin to move towards a customer-centric approach.
Life-long stable business structures and habits were changed to create real value for their customers. And customers are different today: they don’t buy everything, and people ask for experience and values. Nevertheless, the journey to a new type of financial services has just begun.
Consumers need life-centred design
In times of low rates of interest, people are putting organizations even more under pressure to define their successes in more life-enhancing ways than financial growth. They force businesses to rethink their focus on a narrow definition of growth. It’s not chic to be the gainer without values.
People ask for more products which are meaningful and ethically correct.
Liquid expectations
Your customers are comparing their best experience with their worst one. They don’t care to compare apples with oranges. They compare Apple with you. They don’t bother about the complexity of processes.
Consumer preferences are shifting. A free account and an app no longer engage your customers. Whatever you deliver, it has to be simple, transparent and without small print.
The ethics question
Organizations must proactively demonstrate what they stand for, whether they want to or not. People will choose a bank or insurance company that aligns with their beliefs.
Complying with SDG (Sustainable Development Goals) by certification will not be enough to demonstrate a real intention to transform your organisation and the world in which we live. Organisations have to do more productive and profound work. Customers are demanding real action and sincerity from an organisation of their trust.
In this time of the pandemic, climate change, racism and inequality, it is essential to have a clear thought about what to stand for, especially regarding how to create benefits.
How are your employees?
Tough times can produce employee disengagement and frustration. There are topics like inclusivity in employee experience, retraction or change management. Employees tend to reject transformation because they are not involved in the process.
In times of permanent transformation and new ways of doing things, it is essential to take into account the emotional state of your employees and to let them participate actively in the process of reinvention.
Employees are not afraid of change; they fear loss.
Acknowledging this helps to improve their proactiveness to create resilient innovation.
Besides human needs, there are also organisational challenges.
Service design for financial services can tackle these challenges range from how to serve the multiple needs of a various segment like SMEs, to how to leverage revenue and visibility for new FX services.
Industry disruption
How to handle the new kid on the block? Fintechs are entering the core business and grabbing some revenue.
FS is learning fast and battling traditional weapons like buying or copying Fintech. That causes short-term relief; the problem is that FS does not transform from a reactive to an active and customer-centred business approach. Employing service design in your strategy can help to create new value propositions which make you a real competitor.
New entrants or competitors
If your client becomes unfaithful.
Clients act like water; they take the path of less resistance. Life has to be comfortable, and it is no wonder they demand customer-centric products; they like to have something that fits their needs. Fintech competitor’s value proposition is often this: Put the customer need in the centre of their business, and they succeed.
Regulatory changes
When GdPRxMiFID2*** are taking over your customer experience.
All new requirements which FS is facing are the result of lousy customer administration and not being clear about what FS was selling their clients. Far too complex products and small prints have made that new regulation was coming up, which drives customer experience to the limits of digestibility.
Damage to company reputation
When suddenly you are the bad guy.
Redrive customer perception is a tough task. The image people have of FS was built over the years, so rebuilding this image is something which requires patience and a good strategy.
But more than anything, it needs a fundamental transformation. This isn’t something you can fake; it has to come from the organisation’s heart, and service design is the best approach to reach that goal.
How to tackle these topics?
The goal of service design for financial services is respecting a human/life-centric approach in every sense is the key to building a solid relationship between you and your customers, partners or employees.
It is also important to mention that changing the point of view on problems you may face offers new insights and, therefore, new approaches to solving them differently. Asking for external help is not a weakness; it is necessary as an individual point of view is often biased.
Service design methodology doing holistic research, co-creation, and design thinking help to understand the real problem. It reframes the challenge and looks for solutions in multidisciplinary workgroups to get meaningful results.
Relevant industry experience
- Banco Santander (Spain)
- NatWest Bank (UK)
- Zurich Insurance (Switzerland)
- Generali Insurance (Spain)
- Banco Popular ( Spain)
- Piraeus Bank (Greece)
- TSB / Sabadell bank (UK)
Let’s talk about how service design for financial services could help your organisation.
I’m glad you made it this far. That seems to be a good sign;
perhaps I can be of use to you.
I can help you with something or if you want to know more.
Frank Hoeft – designSTRTGY
Phone +34 677 22 95 75 (WhatsApp/Telegram/Signal)
Or write me a message here…
