Results of the study were released today in conjunction with the 28th EFMA Convention being held in Barcelona, March 23-24. Based on self-assessment questionnaires, the study finds that banks fully understand the value of gathering, accurately storing, analyzing and retrieving relevant customer data. They realize that to clearly define such data into segments will impact the success of their strategies for new customer acquisition, cross-selling and multi-channel customer-management and this is more strongly pronounced since the first survey carried out in 2003.
“In this third year of our joint study, EFMA and SAP offer an even wider base of participating banks and deeper insights into the challenges faced by our members for transforming retail financial services to meet customer expectations,” said Patrick Desmarès, executive director of EFMA. “These key findings bring us to the heart of the problems, and the opportunities, for our industry. In the coming year it will serve as an excellent platform to help EFMA further its mission of provoking debate and discussion to encourage innovation.”
Key findings on customer information systems include:
- Whereas easy access to data on customer transactions, satisfaction and attitudes is a reality for only 23 percent of EMEA banks today, 88 percent of the banks intend to reach that level of data quality by 2009.
- One-third of EMEA banks analyze customer data on an ad-hoc basis.
- Only 11 percent have a regular and consistent data mining process.
- Eighty-nine percent intend to gather data by customer segment that covers either all customer-relevant data or only some key parts such as complaints, sales visits and invoicing.
“In an even more mature market, organic growth can be pursued only with the support of a more structured business intelligence process allowing banks to reach an appropriate level of information quality essential to have a deeper understanding of customer segments,” said Daniele Bonfanti, program manager at Financial Insights, EMEA. “Banks need to transform data collection and analysis in a highly flexible process to be able to really support the business decisions and initiatives and, more importantly, the need to move away from a business intelligence approach that is often too late, too slow, too rigid.”
Additional key findings include:
- Growth strategies to drive profits: An overwhelming number of banks (75 percent) favored growth over cost-cutting as their primary business strategy.
- Greater efforts to speed up response times: Sixty-one percent of survey participants expect to offer differentiated products and service propositions based on validated customer need by 2009, up from 12 percent today.
- Constraints with current IT systems: More than one-third of banks report constraints to their IT systems in achieving their strategic goals. In three years, 98 percent of these banks expect IT to support their business strategies, as well as provide competitive advantages.
“Banks’ IT systems and organizational structure need to support information availability across the entire enterprise to leverage the potential of effective customer management,” said Richard Lowrie, director of banking strategy, SAP AG. “In comparison to the results of the study conducted in 2003, the new study reveals a correlation between a bank’s business strategy and the ability of its core systems to support customer-centric business processes. For SAP, the findings confirm that our development efforts in analytical banking capabilities meet a pressing and ongoing need in the industry.”