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Ahem, Bank Honcho! You ve Got a SIT-U-A-TION!

Roland Alston, Appian
August 26, 2016

You know that Clorox commercial where the little boy rushes into the bathroom in the nick of time,but he can't figure out how to undo his belt? "Oh no! Oh no! Oh no!" he says. "I hate this belt. I hate this belt... MOM!Ö We Have a SIT-U-A-TION!"

Yes, the little boy's sense of frustration is funny. But in the financial services industry, the urgency of customer frustration is no joke. Nope, in fact, customer frustrationisone of the biggest contributors to customer defections. The same is true in banking. Here's the math on the situation: 27 percent of unhappybank customers defect every year,according to the experts at Bain & Company. On top of that, frustratedcustomers represent over $600 billion in deposits andrevenue at risk, according to a recent brandvulnerability study by the industryexperts at cg42.

I saw thisfrustration inaction the other day, when I walked into MEGABANK to make a cash deposit. (I've changed thename of the bank to protect the innocent). There was a singlestressed out teller working both the main counter and the drive-thru window. The vibe in the branch itself was low energy. No hustle, no bustle. And, too fewtellers working the main counter.

Ticked off bythe slow pace of service, the lady behind me complained that it was always like this atMEGABANK. Then, she summoned the honcho sittinginthenearby office. "Why don't youhave more people workingthe counter? She asked. It's really busy in here."

"I've got two people backthere now, which is what we usually have" said the honcho."

"No... you don't have two people back there," said the lady. "You only have one. That other telleris busy doing other things. She hasn't waited on anyone since I've been here... Every time I cometo this branch, it's the same story -- long lines, slow service."

"Sorry Miss," said the honcho, as he walkedback tohis office."We're doing the best we can."

"They just don't care," said the lady. You'd think they'd schedule more tellers for peak hours,to speed things up. This isridiculous. I'm seriously thinking about switching banks."

Perhaps the honchomiscalculated, and scheduled too fewtellers to workthe counter, in an effort to reduce costs. But the best brands aren't winning customersby just simply cutting costs.Nope, they're winning customers by making it easier for customers to get the service they need.

It turns out that this is what bank customers care about most, according to a recentstory in the Wall Street Journal(WSJ). Yes, access to branchless and mobile banking is important to many bankcustomers. But so is the customer experience delivered bybrick-and-mortar branches. Some 35 percent of WSJ readerssaid so.

The thing is, when people want to borrow money to purchase a home, a car, a vacation, whatever... they want fast, easy access to the funds. In other words, if you're in the business of taking deposits or issuing securities, making loans, keeping assets incustody or trust, or managing them to generate a return, every customer interaction is anopportunity for you to eliminate frustration that can put potential revenue at risk.

This kind of risk happens when customersdon't feel like theirtime is valued. Like when youstart, stop and resume a transaction on your mobile banking app.Then, when you call customer service, you are forced to repeat information to acontact center agent, whohas no idea whyyou called in the first place.

Or maybe you want to apply for a business loan. But you have tomanually fill out a loan application at a branch location. Then, the application isemailed or faxed to a loan officer, who sends itto an outside Appraisal andTitle company. Then, days or weeks later, the application comes back to the branch for a loan officer toapprove.

These kinds of slow, inconvenient business processes have put revenue at risk with digital disruptors like Lending Club andKabbage. These unconventional lendershave developed faster digital underwriting processes,which can make loans of up to $100,000 in minutes.

But whatif you could outmaneuverthe disruptors withfaster, mobile Loan Origination applications to accelerate loanapprovals? Whatif you could quickly deploy these apps, without the hassle and cost ofprovisioning and maintaining on-premises hardware? What if you could simplify thecomplicated processes behind routine, customer-facing transactions, tocut customerfrustration to the bone? In the old days, this kind of digital speedwas harder to come by. We didn't have the speed and power of enterprise-grade,low-codeapp development.

Cue up the boy in the situation' commercial.Sometimes an imagecaptures urgency better than words.This Cloroxaddoesthatperfectly.

My point is that in today'seconomy, where customer interactions matter morethanever, there's a sense of urgencyaboutembracing digitaltransformation. Think about it. Thenumber of devices on the Internet of Things (IoT) will more than double to 22 billion by 2018, according to IDC. This digitaltrendwill drive the development of 200,000 new apps and solutions totake advantage of IoTdevices.On top of that,organizations like yours will have tooverhaul legacycustomer engagement systems to support up to 10,000 times more customers and customer interactionsthan youdo today.

Yes, digital transformation will help you keep your IToperations humming. But the coolest thing about digital transformation is that it will help you winnew customers and keep more of the ones youalready have. For aspiringbank honchos, what couldbe more importantthan that?

Roland Alston