Client lifecycle management (CLM) is often proposed by technology vendors as a ready-made solution that can be applied to a broad array of organizations. Yet CLM has many meanings, which is why Swisscom and Appway took the initiative last week to look at it specifically through the lens of banking. Our joint event offered the stage to three major banks—one retail (PostFinance), one universal (Zürcher Kantonalbank), and one private bank (LGT)—all of which use CLM in completely different ways.
As Silvan Lohri of Swisscom said in his introductory note, CLM draws its inspiration from customers, both prospective and existing, and places them in a long-term perspective. It’s perhaps that very focus on the bank’s customers, rather than on operations, products, or competitors, that makes CLM such a tempting albeit vague concept for incumbent banks—especially in light of competition from FinTechs and neobanks, which rarely have a comparable customer base to work with.
The case in retail banking
For PostFinance, CLM is about mapping customers’ needs with the bank’s products, based on continuously enhanced customer intelligence, explained Dennis Lengacher, Head of Customer Lifecycle Management at the company. Seen that way, a savings account, a credit card, or a pension plan is no longer a mass market product but rather a well-targeted response to a specific customer need in a given life situation. Yet to deliver success (namely, higher conversion rates at lower distribution costs), PostFinance also tailors the customer communication, with either personal advisers, contact centers, or online channels taking the lead in addressing the customer individually.'
Remo Schmidli discusses ZKB's client-centric initiative
Remo Schmidli, head of multichannel management at ZKB, talked about CLM as a radically client-centric way of thinking and designing solutions. A concrete offer should never be a banking product in the first place, it should be a solution that matches a confirmed customer need. Inspiration is drawn from outside the banking industry, particularly from e-commerce. For instance, ZKB lets customers place individual items in shopping baskets as if they were on the Amazon or Apple website—and while they’re buying banking products, ZKB hardly ever speaks banking with them.
The case in private banking
For LGT, CLM is a global process improvement initiative that facilitates and improves internal banking processes. Why should that be relevant to the customer? Because by reducing complexity for the bank’s employees, be it by guiding relationship managers intelligently through a given process or by automating KYC data checks in the background of a customer interaction, employees can focus on what they’re good at and where they can offer real value. “We don’t have any concrete KPIs, but we know that with our CLM program, we invest in the satisfaction and loyalty of our customers by providing them impeccable service,” stated LGT’s Christian Klammer.
Final thoughts – What CLM offers
All three presentations evidenced how CLM—if well executed and supported by a cross-disciplinary approach across the organization—can deliver significant business value, whether in the form of bespoke service, improved convenience, or contextualized customer journeys.
Building on their presentations, CLM’s value could be described as follows: * In retail banking, CLM enables a paradigm change from product-centric to customer-centric * In private banking, where customer centricity has a longer tradition, CLM reduces complexity resulting from greater scale, international business expansion, and regulatory change * In both private and retail banking, CLM improves employee productivity
Retail and private banking are two different markets, but they both need to make sense of mounting volumes of data and install a culture of change. Thus, both ZKB and LGT embrace agile methodologies, and while CLM allows LGT to reassess internal roles, it challenges PostFinance to pull the whole organization in the same customer-centric direction.
Panel discussion with Hanspeter Wolf, Christian Klammer, Remo Schmidli, and Dennis Lengacher
Customer orientation is inextricably linked to continuous change, and digitalization drives that change. Digitalization comes with many opportunities which can, however, also quickly turn into risks. “What today is considered a great user experience will tomorrow only be satisfactory,” noted Appway CEO Hanspeter Wolf during the event’s panel discussion. “Therefore, the core competency of banks must be to enable continuous change, and software should help you build that competency.”