Lock Down Banking's FutureLock Down Banking's Future

CRM Redux
Many banks got burned during the initial craze for CRM technology. But today, the technology is there to enable banks to achieve that long-sought 360-degree view of customers--and the cultural focus has caught up with the tools.

Customer-data integration lets banks understand patrons more than ever. "CDI is the next level of integrating all the information on your customers--all their relationships," says Alex Berson, director of BearingPoint and leader of its customer-identity-management practice. This includes not only customer data from within the bank but publicly available demographic data on individuals obtained from third parties. Banks are aware of the privacy implications of engaging in this practice, but "this is the way financial institutions have to go," he explains.

Once these building blocks of customer data are in place, banks are ready to cross-sell. But is that enough? The next logical step in the customer-relationship-building process is offering customers bundles of products at a discounted price, says Mike Blum, president of the financial-services division of Amdocs, a provider of customer-management products and services. This is the retail model for which banks should strive, and it will drastically change the face of banking, he contends. "Banks have finally figured out they're retail organizations and have to sell more products to customers," Blum says. "They need to be able to do dynamic pricing and sell a bundle of products to customers, not individual products. You establish a long-term relationship with custom- ers when you do this--it's a stickiness strategy."

Mobile Moves
Banking lags even the insurance industry when it comes to mobile technology, says Tony Kleckner, director and practice leader for financial services with communications technology provider Avaya. "Insurance is under pressure to cut costs and is more willing to try radical approaches to do this," he says.

But banks definitely are interested in the technology, says Jim Bright, Cisco's U.S. financial-services-industry marketing manager. Unfortunately, "they're holding back because there are still some security concerns that aren't well-founded when it comes to the technology," he says.

The possibilities for enabling a flexible, mobile workforce will rise over the next year as connection speeds and signal penetration improve. Increased productivity and customer satisfaction are the payoffs of a good wireless strategy for the savvy bank.

"Mobility converts to increased productivity and customer service," Bright says. "Branch employees can use mobile tablet PCs to assist customers while they're standing in line. There will be connectivity to self-service information kiosks. You can connect customers with a product specialist who isn't even located at the same physical location."

This customer advocacy is the ultimate in service, Avaya's Kleckner says. "Having a technology infrastructure where you can quickly pull in a representative who can fix a customer's problem even if he's not in the same room is where this is going," he says.

Nano Advantage
As far-fetched as it might sound, nanotechnology's benefits shouldn't be overlooked by bankers, says Jack Uldrich, president of consulting firm Nanoveritas Group. One possible financial application is incorporating nanomaterial into currency to prevent counterfeiting and assist with authentication. "You can develop material that's really small that can identify physical currency and a host of other documents," Uldrich says.

But nanotechnology's real promise in banking is in the smaller, more powerful computing and storage devices it will enable. Nanoscale is the next logical step in computing, and computers will become so fast because of nanomaterials that banks will be able to mitigate risk and perform other functions at greater speeds, Uldrich says.

Data storage is improving as well. When the technology is nano-enabled, it will allow banks to further squeeze efficiencies out of operations, Uldrich adds. "Much of what's on paper will be digitally stored at a fraction of the cost."

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