Successful Strategies in Client Service Adrian Godfrey TS EMEA Client Services Executive Michael J. Rosenberg TSS Research & CI Executive FOR INTERNAL USE ONLY
Background & Introduction Building and executing against a successful client service strategy is an ongoing, iterative process Our clients drive the iteration of our strategy and play a fundamental role in guiding its direction: Voice of our Clients Program What is VOC? Why do we invest in VOC and how do we use it? 1
Voice of our Clients (VOC) What is VOC? Formalized, disciplined program which is central to the continual improvement process. The focus is on: Gathering client insights and perceptions Assessing and interpreting client feedback Identifying trends Highlighting urgent issues Communicating actionable insights and recommendations 2
Voice of our Clients (VOC) VOC takes many forms Each form or methodology plays a key role but on their own, none are able to provide a holistic picture: Surveys Focus Groups Roundtables Interviews Forums Discussions with Treasury Services relationship managers, client service officers, product specialists, senior management 3
Voice of our Clients (VOC) Why do we invest in VOC programs To measure and improve our performance across all areas that are important to our clients: Service Delivery Implementations Sales / Relationship Management Product Performance Product Development and Innovation Technology 4
Voice of our Clients (VOC) Leveraging VOC feedback Integrate the data into continuous performance improvement processes focused on: Improving client satisfaction Building customer loyalty Benchmarking ourselves against our competition Measuring and performance managing our people 5
Continuous Performance Improvement Implementation of Action Plans Obtain Client Feedback (e.g.,client interviews, client forums, surveys, focus groups) The VOC Value Chain Analyze Results & Assess Client Needs & TS Performance Develop Action Plans & Timelines Determine Root Causes Set Targets/Goals Prioritize Opportunities For Improvements & Value Creation 6
Voice of our Clients (VOC) What differentiates Treasury Services VOC programs Formalized VOC process with a horizontal view across the organization: Support for VOC programs at all levels of the organization Central research organization that provides independent counsel and guidance Ability to integrate market data, competitive insights and internal MIS with VOC insights to establish a holistic view of the market and our performance Commitment to ensure that learning translates into action and change VOC processes are integrated into how we do business 7
What Customers Are Telling Us Best-in-class customer service is characterized by: Single point of contact/relationship level - Responsiveness/taking ownership Follow-up - Knowledge of both Client and Bank Proactive Service - Availability Access to product delivery function for operational specialists Channels People are the most essential element regardless of the model with implications about single point of contact Aversion by some clients to Call Centers and VRUs, yet acknowledge usefulness for off-hours coverage, backup coverage and usage by specialized operations ecare/on line self service is very appealing yet few are aware of its availability Dedicated Service Rep (DSR) / CSO receive very high marks Service models Back up for the DSR is critical DSRs must have access to Product systems for inquiry and improve communication between the two areas Product Inquiry Units (PIUs) are most effective for focused operational areas within clients Clients want full visibility to activity across all channels and operational areas 8
Excellent Service Excellence is doing ordinary things extraordinarily well. John W. Gardner 9
Why does Service Quality matters? A differentiator in the market that will be a significant contributor to whether you Retain existing Clients Win or loose new business Sustain margin levels Leading market research firms are in agreement: FIMetrix cites Customer Service Quality and Operational Product Quality as among the top 5 attributes that matter most to bank clients of major financial institutions. Greenwich Associates cites Customer Service as among the top 3 drivers for winning or loosing cash management business and customer retention. It is also according to Greenwich the #1 reason why banks are considered leaders. 10
Our Strategic Vision Strategic Vision: Achieve best in class client care by showing Passion for, and focus on, our clients Global connectivity, leveraging our best practices and delivering products, solutions and service in a consistent, efficient manner Innovation, enriching and extending our core business Quality as a key differentiator, with excellence in our people, culture, products and overall delivery to clients To execute our strategic vision of client care, we have developed a global discipline and a global platform, providing clients with best-in-class service. Our global model incorporates Regional and Local Coverage State-of-the-art Inquiry Systems Proactive Partnership 11
Core Approach to Client Services Values Clients remain central in everything we do People are the most important resource Teamwork across the organization allows us to deliver on client expectations Ownership and individual accountability is expected in all our client interactions Use Technology to enable a better client experience Operating Principles Excellence in Execution (product and service quality) Integrated experience for our clients and service representative Differentiated Service Models Offer multiple channels to client and offer incentives to use the most efficient Great MIS/Intelligence Address inquiries at the first point of contact Limit coverage changes with each Client 12
Key Tenets of Client Service Executional Excellence Product delivery quality Service delivery quality Differentiated Service Model Align service channels and service levels to actionable clients segments Core functions receive high quality service via lower cost channels while value added services might require customization Dedicated service officers will act as the client s advocate. Integrated Experience for our Customer and Service Representatives Provide capability to handle request at first point of contact Provide CSOs with visibility to status of client cases across all channels Provide clients with a seamless, consistent service experience across all channels Web Self-service channels will be integrated to be seamless with the transactional self-service tools End to end service and implementations Service Levels from the customer viewpoint will be defined, tracked and managed Great MIS 360 View of client - all interactions across all service channels and for all products will be tracked Quality measures will be used to identify both client quality issues as well as opportunities for improvements Competitive insight on Service and Implementation developments/market standing will allow us to benchmark 13
We have the opportunity to truly differentiate ourselves from the competition based on client service Our market knowledge tells us that there is an opportunity to differentiate ourselves from the competition along 5 key dimensions Excellence in Execution Ensuring that whatever we do, whether it be processing a wire transfer or responding to an inquiry, that we get it right the first time and quickly. Customer Intimacy Establishing deep relationships with our clients that reflect our desire to be true business partners by understanding our clients' businesses, how they use our products, how they want to serviced and being proactive in how we respond to those needs. Responsiveness Ensuring that we take ownership at the 'point of entry' for our client s issues, serve as their advocate and demonstrate a sense of urgency to drive each issue to resolution. Proactive Service To keep clients informed of changes in the market, industry and regulatory environment that may impact them. To ensure that we advise our clients of any issues that may impact them before they notice them. Innovation Continually seeking and delivering on opportunities to enhance our clients' businesses, whether that be through new products, services, solutions or insights to help them in their quest to be more efficient. 14
What is the right Service Model? The right Service model for any business is the one that delivers satisfaction to the client at a unit cost that satisfies both the Client and the Shareholder. 15
Process Identify Customers and Their Needs Identify Customer Value to Firm Identify Foundation for differentiation Client Structure Segmentation Servicing needs and behaviours Stratify Strategic and economic value of different clients to firm Retention/Attrition Drivers Differentiating service attributes Competitive Intelligence Develop Targeted Customer Experience Operational Structure and Investments Continuous Improvement How our competitors are servicing customers How we rate compared to competitors Customer Intelligence Quality of current service experience What are our clients telling us about their needs What Channels What Services Relationship Model Operationalize Brand What Technologies What operational structures What organization What Metrics What skills Strategic Goals Product Goals Growth Strategies Baseline Cost of Service Delivery Channels Service Standards 16
Integrated Client Experience Service Model Address All Client Touchpoints Internet VRU Service Channels Service Centers CSO/CSP Inquiry Groups Implementation Client Segmentation & Strategy Client Segmentation & Strategy Cost Structure Cost Structure Service Levels Service Levels Employees Technology Intelligence/Feedback Delivery: Transmission & Transactions Value Tiers Segmentation for Service Servicing Profiles Organization Skills & Product Knowledge Performance Measurement & Training Incentives Relationship Model Customized processes Service Plans Quality Reporting Client Self-Service Channels Call Center Platform Service Desktop Implementations & MIS Tools Expense base Key expense drivers Comparative channel costs Operational Performance Client Analysis & Feedback Competitive Insight 17
Differentiated Service Model Differentiating the Client Experience Without Changing the Core Factory Areas of Service Differentiation Service Levels Service Level Agreements Differentiated SLAs Integrated business processes with client Implementation SLAs Enhanced reporting against SLAs Follow ups on Status Relationship Calling Frequency Service Plans Quality Scorecards Coverage (CSO, team, etc.) CSO selection Role on Advisory boards Technology & Tools Priority in the resolution queue Limit telephone hold times Push product or service notifications Straight through processing on customer set up Access to all cases on line Channels & Product Channels Customer inquiry reports Service alerts Specialized reporting on inquiries 18
Client Care continues to commit investment funding and resources to three key strategic priorities: JPMorgan Clients ecare: Web channels and integration with traditional service Inquiry Management: Automation of service flows and 360 degree view of Client Care Implementation Automation: Seamless end-to-end implementation process JPMorgan Client Care 19
Enhancing the quality of the customer service experience is the primary motivation for the ecare program. Benefits include: Flexibility: additional channels through which to send and receive information Speed to Answer: direct access to information repositories Efficiency: seamless transfer from search to investigation Control: Access to status of service requests Transparency: Greater breadth of information (details,case status) Accuracy: Eliminates re-keying of information Security: Encryption, digital certification, password protection Contingency: Anytime, anywhere access 20
The internet, and its related technology, introduces the potential to redefine the operating models for customer service Emerging Channels and Model PHONE WEB SWIFT Service Staff Service Staff Information Repositories Successful application of the internet goes beyond developing self service tools. It requires intuitive linkages between human and electronic modes of client care. This is known as ecare. 21
JPMorgan established our ecare program to meet the emerging service needs of our clients. The ecare program is designed to achieve a customer service model in which technology solutions operate in full concert with staff-supported functions. Clients Channel Layer Our ecare strategy is based on three core functional components: WEB PHONE WIRELESS SWIFT FACE TO FACE Self Service Self Service Integration Traditional Service Automation of Implementation & Service Infrastructure Channel Integration Implementation and Service Infrastructure JPMorgan Every strategic investment we make in ecare delivers on one or more of these components 22
Cost reduction is often cited as the primary reason for investing in self-service 5 $4.60 Average Per Transaction Costs 4.5 4 3.5 3 2.5 2 1.5 1 0.5 $4.05 $3.80 $3.35 $2.30 $1.80 $1.40 $.40 $.25 $.20 $.10 0 Expert Agent Branch Platform Priority Agent Source: Tower Group, Gartner/DataQuest Back Office Call Center Agent Email Agent Branch Teller ATM IVR PC Banking eself- Service however our experience has shown that cost reductions are slower to materialize, and the true benefit lies in: meeting client demand enhancing the quality of the service experience, and achieving competitive differentiation 23
Our clients have expressed a keen interest in utilizing more of the internet to conduct their service activities. REGION Total Asia EMEA WHEM Latin Amer. WHEM Texas US Total Answering 1125 268 181 676 45 150 481 Researching and resolving inquiries 74 65 79 77 64 73 79 Sending and receiving inform ation to/from JPMorgan Treasury Services (e.g. acct. #s, T ransaction D etails) R eceiving billing statem ents and paying your bills Changing an existing service or product 73 70 79 73 78 69 74 50 44 53 52 60 37 55 48 22 30 63 31 77 62 Activating a new service or product 47 28 32 59 44 65 58 Receiving transactions and/or inform ation alerts via em ail or m obile device (e.g. cell phone, PDA, pager) Reviewing and digitally signing legal agreem ents. 36 22 30 42 47 45 41 21 13 14 26 13 21 29 Other 8 9 8 8 11 12 7 -Treasury Services Client Satisfaction & Service Quality Survey, Dec 2002 Approximately 75% of all clients would like to be able to research and resolve inquiries as well as send and receive information to/from Treasury Services via the internet. Close to 50% of all clients would like to change an existing service or product and activate a new product/service on-line. 24
Web based service solutions are becoming a prerequisite for competitive success. Customer service quality has always been at the top of corporate and institutional clients lists as a key differentiator between banks. New Web-based customer self-service system seek to leverage this concern by offering clients increased transparency into the banks internal systems and databases, with the promise of increased control over the customer service and other processes and a better flow of event-based information. Tower Group, Dec 2002 TowerGroup believes that the successful implementation of a customer self-service system will be a precondition for market success for banks in cash management and other transaction processing businesses. Tower Group, Dec 2002 To exceed customers expectations... provide self service tools such as on-line access to identify, research and/or correct conditions and access to a help desk expert to answer questions ORC International, Nov 2001 25
What to consider in exploring ecare potential in your own firm Multi-channel is the only sustainable financial services delivery model Apply a customer view to maximize effectiveness and adoption of ecare solutions ecare must be considered strategically; it is not a collection of point solutions Governance and discipline from top-down is essential Implementation of ecare solutions typically requires some restructuring of today s infrastructure Discipline around metrics will optimize the success of ecare initiatives excerpted from LabMorgan ecare Research 26
Excellent Service Excellent Customer Service is all about people. Success will be measured through people not technology. 27
Summary Treasury Services Client Service strategy is one of continual improvement and assessment: Our goal is to continually evolve and adapt to meet the needs of our clients Formalized processes are in place to measure our performance and to obtain the critical component to our success feedback from our clients And now its your turn to tell us what you re thinking 28
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