By Tom Murray, Head of Product Strategy for LifePlus Solutions at Majesco.
Life and pension providers need to respond to this. Traditionally, financial services has operated in a way that meant that the actual customer - the owner of the money - had to go through an incredibly bureaucratic process to get hold of his or her money, or even to get any information about it. Pension valuations could take months. Fund switches could take days. The length of time it took to make a claim could vary wildly. All because of the highly manual processes needed to ensure confidentiality for the client focus on making it easy for the company to keep the data secure rather than placing the customer at the centre of the process.
No one is arguing that data security isn’t important, and consumers generally don’t have any objection to going through processes designed to ensure that their financial details are kept secure. But generally, not at the expense of having to undergo a cumbersome process just to get information about their own finances and particularly not while the technology exists to do this far more easily.
Other industries have grasped the opportunity provided by voice, fingerprint and retina recognition technologies to eliminate a lot of the procedures that go with authenticating requests from the public, ensuring that the request is coming from someone authorised to make it. Many banks now allow money to be transferred or payments to be made based purely on fingerprint or retina identification. Credit cards information is often stored and used based on using the biometric id attached to the account.
Technological advances are making it easier and more intuitive for consumers to transact their life online rather than having to drop back into the paper-based world in order to get stuff done. As the rest of the economy moves rapidly into the digital space and puts the consumer firmly at the heart of the process, how long can the life and pension sector hold out?
Key to the ceding of control to the customer is providing the ability for consumers to decide when, and in what way, the interaction with the company will happen. This means that the customer journey should be totally based on the customer’s preferences, and not on how the life and pension company wishes to manage the process. In order to achieve this, the company needs to think like the customer. It needs to prioritise the customer’s need to access their data or carry out whatever changes they wish without unnecessary complications.
It also needs to “think digital” as the default approach, as only a digital by default approach can supply the flexibility that enables the customer to control the process. And flexibility is key, as customers are not a homogenous group. Providing them with options for engaging with the company, allowing multi-platform approaches with interactions able to start on one platform and be completed on another – these are central towards giving the customer the control of their finances that they wish to have, in the way that they wish to have it, and at the time they wish to have it.
At the core of these customer-centric environments must lie a cloud-based solution, which can be accessed from any platform. This will enable the life and pension provider to introduce new services and apps rapidly to respond to customer demand and market initiatives. In particular, allowing smartphone apps to access real-time information and allowing customers to authenticate themselves and avail of services or access their product information without having to interface directly with the providers staff will be an important aspect of the financial services sector going forward. These types of real-time services are difficult to implement without utilising a cloud-based solution at the heart of the provider’s infrastructure.
Providers can try to maintain control over the customers interaction with the company but the more control they hold onto, the less control the customer has. Companies that don’t manage this will look out of place in a world dominated by new entrants from the fintech world who are focused on providing customer centric services that will be far more appealing to the younger “always on” generation.
Life providers must adjust their mindset in order to empower their own customers and leverage technologies that will enable them to compete by providing the customer-centric environment of the future, rather than remaining in the business-centric approaches of the twentieth century. Clinging on to control will ultimately lead to reducing sales as customers switch to providers who do give them control. It’s a zero-sum game and those providers that don’t adapt, won’t survive.
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