Engaging the customer on their terms, not the reverse

Conversation with JEFF HIBBARD on the subject of Customer Onboarding.

Jeff Hibbard, Former Fidor, TD, & BB&T

This past January, my colleague Syed Bukhari and I had an opportunity to interview Jeff Hibbard about the topic of customer onboarding for banks and credit unions. Jeff Hibbard, former Fidor, TD and BB&T is a digital leader in the retail banking and payments space. Throughout his career, he has strived to deliver business outcomes by improving customer experiences and increased market share through product related innovation and commercialization. Jeff specializes in developing digital transformation strategies and products that create differentiated value propositions in the crowded, hyper-competitive retail banking space. As an innovator, Jeff delivered the first ‘open source’ technology for BB&T, which paved the way for broader modernization efforts, including digital infrastructure build out. While at TD, he helped create the first mobile wallet for the U.S. franchise, along with the first multi-issuer standards for payment tokenization for the bank.

Syed and I are pleased to share this insightful 30-minute interview in long-form.

Please note, the views and opinions expressed in this article are those of the Jeff, Syed, and myself only. They do not necessarily reflect the official policy or position of our respective employers. Examples of analysis performed within this story are only examples.

Syed: Jeff, thanks for joining Pari and I today. I appreciate you taking the call to share your insights on customer onboarding within banking.

Jeff: Syed, it is a pleasure. I am happy to do it.

Syed: So, here’s our first question. In your opinion, what do you see happening in the area of customer onboarding today? Please share some highlights and pain points in the process.

“Onboarding starts long ways before a sale ever takes place”

Jeff: I will speak to it both as a customer, and as someone trying to do something about it in the financial services industry.

Our view of it in the financial services industry is that the onboarding process starts after we have sold a customer a product. I argue there are 10 to 20 steps before that, which we are not even considering. I think we as an industry talk about onboarding in the context of a sale. And, I think it is the wrong way to look at it. It is short-sighted. I would argue that onboarding starts long ways before a sale ever takes place. In other words, that customer journey begins way before we sell them a checking account, or make them a loan.

We have invested much money, time, and resources into product-centric onboarding. Let me illustrate with an example. The customer buys a product. We then take them through the process of helping the consumer understand the product’s features and functions. We might even put out an FAQ, and we might also educate them on how to use it. However, I think what we need to do as an industry is take a step back from that and think more holistically about our customer, more broadly about their need and less about our products.

If I may, let me use Pari and his bank’s bill pay product for a moment. Pari, as a bill pay product manager, is focused around educating his customers on how to use bill pay. He is doing so because he wants to drive adoption. Whereas, his customer’s questions could be very different — “I am just trying to figure out how to pay the rent at the end of the month.” Here, the consumer is not worried about how to make the payment, but about how do they take their paycheck and afford to pay all their bills? Look, the consumer is thinking at a much more fundamental level. However, I believe that as an industry we get wrapped up in product noise.

“I think it is almost like, how do you hit rewind? Deliver a personalized and contextualized customer experience like we used to do it back in the 50s, and the 60s, and the 70s.”

Syed: Jeff, this is very insightful. Thank you. So, where can we go as an industry, from here? Let’s talk about what’s possible in onboarding if we do some of the things you talked about, if we do it right? Where are we headed?

Jeff: As an industry, there is an opportunity for us to start to shift the game and say — before we ever sell the customer anything, let us really understand who this person is, and what do they want. In doing so, how do we prove to that customer that we are indeed competent and able to meet their needs? I think our future lies in really trying to understand our customer profoundly; at a macro level, and on an individual basis. First, getting our hands on the customer’s journey in a deep, deep way. Then, figuring out how to engage the customer in a much more meaningful and insightful way; long before we educate them on our own products.

I think it is almost like, how do you hit rewind? Deliver a personalized and contextualized customer experience like we used to do it back in the 50s, and the 60s, and the 70s. Back then, when our customers came into the bank, and they needed something, we sat down across a desk, got’em a cup of coffee, and started with a basic conversation like — “hey, tell me a little about you, and the kind aspirations and goals you have.” Alternatively, the starting point of the conversation may have been about somebody in our shared community that we both know, understand, and trust. Doing so, got us started from a much more insightful place; where we understood the consumer sitting on the other side of the desk. And I think, we have lost our way over the past couple of decades, and I think what we are now trying to figure out how do we get back to a similar experience.

Pari: Wow, Jeff. Your analogy is fantastic.

“how do we bring the personal touch and the interaction back into the experience that I think we used to have decades ago when it was face-to-face”

Syed: Pari, I don’t think this has come up in our prior conversations and research — “How do we engage customers before we ever want to sell them anything. Similar to the way we used to do it in the 50s, 60s, and 70s.” This is very interesting.

Jeff: If I may, let us discuss a typical customer’s “loan apply” experience in the 1970s. Forty years ago, you would typically walk into the bank with a shoebox of canceled checks to demonstrate that you are paying your bills if you as a customer were looking for credit, and you needed to prove your creditworthiness to the bank. The banker then went through the checks to see who you are paying to determine your creditworthiness. Wasn’t that pretty darn insightful? As I have said before, I believe we have lost our way a bit, and as we have automated things, and things have become more digital. I think what we now need to figure out is — how do we bring the personal touch and the interaction back into the experience that I think we used to have decades ago when it was face-to-face.

Pari: Yeah, and Jeff what you are saying is, we have also lost the connection between our products and the customer’s lives. I think you would agree, and I think that is what your point was, customer journeys do not start with account a checking today. For example, a college student’s journey might begin with just needing to get a debit card, or to pay a bill, or to pay rent. So, that is where the journey starts, and not with necessarily wanting to open a deposit account.

Jeff: Yes, Pari, I would agree. I believe you have to get to the “why.” I think that until you get to their “why” to the part where you begin to understand them fundamentally; what their needs are, what their emotions are, you cannot engage with them meaningfully. This is a more significant challenge in digital than it probably was at the branch — how do we deliver an experience in a way that meets the customer’s expectation through their interactions across the various touchpoints and channels based on their needs and emotions at that moment. Ultimately, I think that is where we have to go.

Pari: Yes, it is similar to what a senior banker once told me when I started my career — “Look, the customer is not coming to us to get a mortgage. They are just trying to buy their home.”

“start inside the four walls of your own organization to understand your “secret sauce” — that is, the service model for your company when it comes to interacting with customers”

Syed: One of the things that struck me as impressive is how we translate the ‘physical’ into digital…it is about converting the experience of the 50s into the digital age. To your point about personalized sources of data (i.e., cancelled checks) to prove creditworthiness could be translated to using social media or other public or private data other than an Equifax report. Question — What can you practically do about it coming from a banker’s perspective, like as a product manager or an executive with an omnichannel charter? What are some steps we can take to start or to move the needle in that direction?

“Let us make sure that we are engaging the customer on their terms, not the reverse.”

Jeff: I think you need to start inside the four walls of your own organization to understand your “secret sauce” — that is, the service model for your company when it comes to interacting with customers. Begin with figuring how you would want to service a customer in a face-to-face, or over the phone transaction in a way that is simple and meaningful for the customer, one that delivers an experience that the customer loves and becomes loyal to. Then, distill that “secret sauce,” and bring that secret sauce to the digital channel. Look, we all have similar products, distribution models, and capabilities when it comes to retail banking. However, our differentiation lies in our customer service models. First, creating that channel-agnostic customer-centered service model is critical for not just digital channel, but for that entire bank or credit union. And then how do we make sure that customer service model and culture shows up in all the places that your customers want interact with you. Today, this is really inconsistent in the industry.

Let us make sure that we are engaging the customer on their terms, not the reverse. So, a simple example: why would you start a loan application in digital, only to learn a couple of days later that you have to go to the branch to sign a document. That is just a ridiculously bank-centered experience for the customer. If the customer starts the application on the digital channel, they quite possibly want to finish that task in the same channel.

Pari: Does that require us to have a unified view of the customer? Today, as customers move from one channel to another, their context and history may not move with them. So they have to repeat their effort or problem when they move between channels. I think we need to deliver an experience where as the customer is able jump from channel to channel effortlessly to complete a specified task, and the bank should be to follow that particular customer at every point in that same journey in almost real time.

Jeff: Yeah, I’d probably back up a step from that, Pari. I would love for my contact center staff to know that Pari Bose visited the website. He was looking at rates. So, we think he wants a mortgage. That may lead to some clues or prompts that we can pass onto the contact center. When he calls, they can help him with that and then if he needs to finish in the branch. However, I think a 360 degree view of a customer is a very aspirational picture for many of us. I think we as an industry would love to get there. Practically, what I can do about it is, at least in the short run is to stop thinking like a banker, and start to sense and respond more like an empathetic service designer. First, understand a customer’s journey, then redesign our internal processes and systems around that journey. Such an approach is an entirely different way of thinking about our business, and service model. Far from — I’ve got a product, or a widget goal, and a distribution center, and what I need to do this month is close on a loan.

“Map your customer’s journey and experience expectation, and then build the business around it — modify your people, process, and technology around that target-state customer experience”

Pari: Yeah, you innovate on the experience using an outside-in thinking, and then you renovate inside-out to support that experience?

Jeff: Right, it is the classic model where the architecture follows the business. Map your customer’s journey and experience expectation, and then build the business around it — modify your people, process, and technology around that target-state customer experience. Not the other way around.

Pari: Jeff and Syed, would you agree, that if we did this well, this kind of design-led thinking might open up new business models/opportunities in that customer’s journey that we just don’t see today because we are so inside-out centered?

Jeff: Exactly, I would expect it would surface a lot of blind spots. Things that we have no clue that is even happening, or have an awareness of today. Indeed, many bank executives wished they could wave a magic wand to convince their colleagues to think in a more customer-centered way. Wow, what a dramatic change in the service and distribution model that would have in our organizations.

“success starts when we take the time to collaboratively synthesize precisely what our points of service differentiation are — our service model”

Syed: So first of all, I would say, I think one of the things that I heard was about identifying your “secret sauce.” Developing a service model and culture that shows up in all channels consistently; I think this is something that we bankers struggle with. So, practically, how are we to start planting those seeds? Marketing? Community outreaching?

Jeff: Look, we have to develop an evidentiary view on the points of differentiation in our customer-service model. Today, everybody says, we are in the service business. Well, at a 30,000-foot view it’s not a very profound statement. However, success starts when we take the time to collaboratively synthesize precisely what our points of service differentiation are — our service model. Distinctions that we can stack up and make a list of from our competitors. And then having them show up in everything that we do. What’s the evidence? How do we monitor it, how do we measure it?

So fundamentally, there are three vital elements for consumer needs. First, consumers want somebody who is willing and capable of helping them. Second, they want guidance and education. Help me figure it out. You are the expert. Help educate me. Third, and this is one that is somewhat easier to measure, is you have to reduce customer effort. How do you make it easier for them? How do you transfer value to the customer with the least amount of customer effort and friction?

Syed: Yeah, I am big on reducing customer effort. However, willingness is new to me. But you are correct. Anecdotally speaking, I do not know many customers actually believe that their bank is willing to help them. No disrespect to banks’ efforts, but there is still a lot of consumer distrust post the financial crisis. Right?

Jeff: We as an industry have been focused on internal-business-process and capability in the retail distribution model. This kind of thinking is still very prevalent in our space. For example, success is setting up an account-opening tool that can verify the claimed identity of the customer, and then takes the customer through a bank-centered workflow to get them a debit card, a checking account, then hopefully cross-sell them a credit card, and then a maybe a loan.

The reason for this behavior goes back to hiring. It goes back to coaching, to training on those three elements of service delivery. How do you define, employ, and measure these behaviors, day in and day out. So a practical way to do that is to analyze service interactions continuously by measuring customer effort at multiple touchpoints in their journey. Let’s measure not only if we meet the customer’s need, but also an understanding of whether we demonstrated our willingness and capability to help them in their goals? Did we reduce their effort? Did we provide you any guidance and value? This is how we hold ourselves accountable.

Pari: Today, we discussed onboarding from the customer’s point of view quite a bit. And, rightly so. If we are going to solve this, we need to design the experience by mapping the customer’s journey. The customer’s agenda has to be front-and-center, and the bank’s internal process and systems have to follow. Question — How could we motivate bankers today to want to deliver a customer-centered onboarding experience? What are the drivers?

Jeff: So, I think you’ve got a classic problem which is true of most banks and credit unions. We can have very fractured internal interactions. When one looks at all the business lines and departments within a bank, they are typically very siloed. So we tend to think of our customer against our own business line, P&L, and processes. However, customers at a bank do not care about business lines. They care about getting their own problems solved; which might require them to interact across several business lines, processes and systems. And I think our organizational structure is a challenge for internal staff; especially when it comes to those hand-offs. It is at the point of handoff between departments where interactions get fractured.

“Retail banking today is a complicated ecosystem of people, process, and technology that can sometimes deliver a very bumpy and disjointed experience for the customer”

Pari: Yes, and I would argue that the fractured experience is not simply because of the silos within the organization. Could it also have to do with the outsourcing model that we embraced so heavily in the last 20 years? The credit card comes from one vendor, debit card from another, the loyalty points monitored and fulfilled by yet another.

Jeff: Yes, exactly. Retail banking today is a complicated ecosystem of people, process, and technology that can sometimes deliver a very bumpy and disjointed experience for the customer. If you think about all those business lines and fulfillment partners as stovepipes, the customer is moving around horizontally, left to right in the organization. Our stovepipes are vertical. So, those handoffs can be rough and lead to unintended consequences. Example, a customer has a problem in the mortgage area. They are really ticked off because the bank’s vendor-outsourced bill pay system failed to deliver the payment on time. However, the same bank’s mortgage department does not want to give up the revenue on the late fee. It’s the lack of this kind of horizontal visibility and awareness which causes things to really begin to break down. So, here you have got the mortgage team sitting there saying — “I do not want to give up the fee income on the late payment.” The consumer gets turned off and says, “Well, I am moving my checking account, my savings, and I am closing all these CDs that I bought.” In response, the deposits administration team says — “I am not going to give up the penalty fees on the early closure of those CDs.” And all of a sudden, you have got a $25,000 deposit relationship that walks out the door. Six months later, they are going to refinance that mortgage loan. Most probably, driven to do so because of the sub-par experience that which failed to generate loyalty. Instead, we will be left with a couple of paltry fees. This gets even better in age of social media. Now, this ticked off customer turns out to be an influencer and complains about your brand to hundreds or even thousands of connections on social media.

Syed: This is a classic example where the bank did not know its right hand from its left. And how the constant focus on short-term gain affects our behavior and willingness to do the right thing.

Pari: Amazing conversation.

Syed: Jeff, thank you. Have a great weekend.

Jeff: Gentlemen, you are welcome. Great interview guys. Bye.


Syed Bukhari: Syed is a former Gartner, PwC, JPMC executive who advises leaders at top 20 retail banks about experience-led digital transformation and innovation. He’s passionate about consulting and uses all his God-given wit, grit and personality to make his clients look good and be successful. When he’s not on a plane or at an airport, he helps his wife with her pet travel startup called SnubStub and reads a lot about child psychology and early education. Connect with him on Linkedin.

Pari Bose: When Pari is not being a father of two very busy daughters and trying to get his resting heart rate below sixty, he manages to dabble a bit in digital banking and payments. A resident of the beautiful town of Fair Haven on the New Jersey Shore, Pari draws upon his product management and operations background to take ownership of strategic directions and operations of digital customer experiences for banks & credit unions. Pari is almost always reachable by LinkedIn.

Copyright 2018 Syed Bukhari and Pari Bose. All rights reserved.