Guide To CRM For Financial Services

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Guide To CRM For Financial Services Powered By Docstoc
					The CIO’s Definitive Guide: Delivering
Results with CRM for Financial Services
How to keep your system integrity, budget, resources and sanity
intact through CRM.

Financial services is a tough, highly-competitive industry that faces
challenges from every corner. Government regulation and deregulation.
                                                                                Your firm’s CRM users
Consolidation. Customer churn. And a pace of change that makes your
                                                                                demand a system that
head spin. And then there are those volatile markets. Despite all of
                                                                                increases their productivity.
that, you’ve still got to come up with the goods and provide solutions
                                                                                But, you must consider issues
that will make a real, measurable difference to the bottom line. And
                                                                                like regulatory compliance.
those measurable differences start by finding ways to achieve internal
                                                                                In this guide, we outline
efficiencies that will help your financial institution deal more effectively
                                                                                the system characteristics,
with customers.
                                                                                integration strategies and
This is often when companies look towards CRM. And when that                    change management practices
journey begins, your job as CIO is to deliver a unique CRM system               that position you for CRM
while protecting current systems, maintaining productivity and thinking         success.
long-term. With minimal cost or disruption. Some would say that’s a tall
order. At Pivotal CRM, we believe it can be done—sensibly, predictably
and safely. We believe the deliverables and requirements of every CIO
embarking on this journey point to one fundamental goal: Select a CRM
system that’s a good corporate citizen.

                       About the Author
                       Jason Rushforth is President of Front Office Solutions–overseeing sales and marketing
                       for CDC Software’s CRM and complaint management solutions. He is known for his
                       keynote speaking engagements for such events as the Wealth Management Forum and
                       webcasts with Wall Street & Technology and TowerGroup, and he frequently contributes
                       to industry articles in publications such as CRM Magazine.

CDC Software | The Customer-Driven Company™                                                CRM White Paper | 1
Here’s a Familiar Scenario                                 The majority of your CRM investment in license fees,
You want customers to enjoy seamless interactions          configuration, customization, and training occur well
with your institution. They need to feel that your         before the software shows evidence of business
financial institution will offer them the opportunity to   results.
make or save money with you.                               Because of this, the price tag attached to a CRM
And those customers need to feel that you’ve taken         implementation can seem very high.
the time to learn and respond to their specific needs.     Early in the buying process, ask prospective vendors
And that’s where customer relationship management          to show you exactly how they approach and build
can really help. Particularly if you understand that       CRM to reduce risk, resource issues, and cost.
CRM is a journey, not a destination.                       By adopting a forward-thinking strategy to account
When that journey begins, your job as CIO is to            for costs in the areas of customization, integration,
deliver a unique CRM system. At the same time you          scalability and deployability, you can significantly
have to protect current systems, maintain productivity     reduce the TCO of your CRM system.
and think long-term.                                       In all of these areas, the lowest total cost is a function
Oh, and you’ve got to do all that with minimal cost and    of the CRM platform and architecture.
disruption.                                                Delivering on internal business objectives while
Some would say that’s a tall order, but it can be done     intelligently responding to customer and market
sensibly, predictably, and safely.                         opportunities is 100% dependent on the technology
                                                           foundation, or the architecture, of a CRM system.
The deliverables and requirements of many CIOs in a
financial services organization point to a fundamental     TCO and the Need for Change
CRM goal:                                                  Within the complex environment of today’s financial
Select a CRM system that’s with good corporate             services firms, effective CRM architecture needs to
citizen. That’s 100% designed to fit sensibly to what      span multiple databases, applications, and business
your company needs.                                        functions.

In the end, what you need is CRM that makes it easy        In order to stay relevant to rapidly changing corporate
for your company to change and respond quickly.            objectives and market flux, it must facilitate evolution.

                                                           To facilitate evolution, application functionality must be
Because you’ll need to do just that.
                                                           supported by the right architecture. Or the application
The New Accountability                                     becomes brittle over time and always feels like it
When it comes to CRM, today’s financial services           needs to be ‘shoe horned’ into doing what you want it
CIO is squarely focused on risk mitigation, resource       to do.
management and cost predictability.                        Many of today’s CRM systems take the wrong
This new focus results in many new criteria.               approach. They tightly couple the customer data,
                                                           business processes, and transactions associated with
How easy is this CRM system to buy?
                                                           marketing, selling, and servicing customers.
Can we deploy in a predictable timeframe?
                                                           This tight coupling may seem to provide a head-start
Will it fit with our current and future business IT        in automating business processes, but ultimately
strategies?                                                inflates the total cost of ownership.
All these criteria play a role in the greater theme of     It creates a system that is rigid to change, causing
buying CRM today: measuring the lowest possible            significant disruption to the business during updates
total cost of ownership, and the greatest business         and upgrades.

CDC Software | The Customer-Driven Company™                                                  CRM White Paper | 2
 The informed CIO must take a balanced approach to          Clearly, customization enhancements are not limited
 evaluating both the application and the architecture       to just the initial implementation, but rather require
 when considering TCO.                                      ongoing adjustment.

 Ultimately, it is the CRM application’s flexibility,       A customizable CRM application supports changes in
 scalability, and deployability that will determine TCO     both underlying data definitions and business process
 as your organization adapts to the changing financial      rules without requiring alteration of source code,
 services marketplace.                                      binaries, or runtime environments.

 Flexibility: Does the architecture facilitate the          How you handle your business rules can provide
 configuration, customization and integration of the        significant competitive advantage, because adapting
 CRM application, both at the outset and over time as       business rules faster than competitors—in response to
 your business needs evolve?                                market pressures or customer demand allows you to

 Scalability: Does the architecture let you scale and       sell your financial services products faster and better

 improve application performance cost-effectively?          than your competitors.

 Deployability: Does the architecture let you easily        Flexible CRM possesses three essential

 deploy, upgrade, and maintain the CRM application          characteristics: breadth (not depth), a highly

 over time?                                                 customizable architecture and a strong integration
 Flexibility = Quick Response
 To Change                                                  Breadth, Not Depth
                                                            First, CRM should provide a sensible set of commonly
 A flexible CRM application is one that is both easy to
                                                            needed features out-of-the-box—but without the
 customize and easy to integrate with intra- and extra-
                                                            excessive depth that makes many other CRM
 enterprise applications and data sources.
                                                            applications inflexible.
 And in the financial services world, there are a great
                                                            Excessive functionality increases an application’s
 many such data sources.
                                                            complexity and reduces the usability of the application
 Architectural flexibility is about making the CRM          for the end-user, resulting in increased end-user
 software, and thus CRM processes, work in the way          training costs and risk of end-user rejection.
 you see fit— not how the CRM vendor thinks it should
                                                            The only remedy for an application that is too
                                                            functionality-rich is to remove the excessive
 Many CRM architectures are inherently rigid, making        functionality during the implementation phase. But this
 the associated applications very difficult to customize.   approach to customization can be very risky—and
 This raises TCO by forcing financial services firms to     very time-consuming.
 abandon proven business processes and start anew,          Chances are that your CEO isn’t overly keen on
 either because customization cannot be done, or            anything that will extend the time it will take to
 because it is simply too expensive.                        get your CRM application live and contributing to
 The true measure of an application’s flexibility           improving customer satisfaction, improved profitability
 is based on the cost to perform customization              and increased customer yield.
 enhancements. These costs can include increases            Massive CRM applications with almost limitless
 in deployment time, decreases in application               functionality depth are built upon a much more
 performance, the cost of acquiring the skills to perform   complex web of intra-dependencies than their leaner
 the enhancement, and future costs associated with          counterparts.
 whether the enhancement can be used (or must be
                                                            In order not to compromise the integrity of the
 discarded) during application upgrades.
                                                            application, customizers must pay extra attention
                                                            when removing or ‘unplugging’ excessive functionality.

CDC Software | The Customer-Driven Company™                                                  CRM White Paper | 3
This results in longer implementation times and             In a financial services environment, there can be a
difficult post-deployment change, and requires the          multiplicity of such databases—dealing with corporate,
hiring of expensive teams of technical specialists,         institutional and retail clients on everything from
significantly raising the TCO of the CRM system.            current accounts to mortgages, business loans,

In a financial services environment, this task must         and investment portfolios. And each of these, of

also be undertaken with a particular view to remaining      course, can carry with it a specific set of regulatory

in compliance with all relevant local, national, and        requirements.

international financial services regulations.               To be effective, the CRM vendor must supply an

Database complexity is a good indicator of the overall      integration framework that spans multiple data

complexity of a CRM system. For instance, Pivotal           stores, applications, and business processes across

CRM’s underlying data structure has less than 200           departmental and even enterprise boundaries.

tables, yet it supplies the majority of the functionality   Financial services companies often grow quickly,
required by most companies. By comparison, massive          expanding through acquisitions that can result in a
CRM systems, in order to support a huge depth of            single organization trying to support many disparate
thousands of features, require a data model with 10 to      systems and clients. Ensuring data consistency,
20 times as many tables.                                    accuracy, and timeliness between calendars, task

This model is not only inflexible, but is often simply      lists and contact information from both connected and

too complex to understand. This necessitates a great        disconnected users on multiple client systems can be

deal of reliance on specialized, vendor-supplied            a complex challenge.

customizers, raising TCO.                                   A cost-effective integration framework should leverage
                                                            and complement existing systems. It should facilitate
Ease of Customization                                       seamless, bi-directional exchange of information to
The second characteristic of a highly flexible CRM          both EAI and B2Bi via industry-standard middleware,
system is an architecture that facilitates change. Look     third-party adapters, and Web services.
for a 3-tier, metadata-driven architecture, intuitive
                                                            Also, watch for an integration solution that is
customization tools that allow you to quickly customize
                                                            standards-based. You want to ensure that you
your CRM solution to match evolving business
                                                            can quickly adapt and extend your CRM system
                                                            dynamically as business systems and partners
Few CRM vendors separate business data from                 change. This is of particular concern in the financial
metadata (how the business data is organized and            services sector, where changes wrought by a dynamic
used). When a CRM vendor makes it possible to               business environment and increasing numbers of
upgrade just the metadata, as Pivotal CRM does,             mergers are common.
all changes to the presentation services, business
services, or data services tiers are managed in             Scalability and Performance
one central location. Execution and development             For financial services firms, scalability is above all
environments are kept separate and only                     about creating high performance CRM from the user
synchronized when appropriate.                              perspective.

Therefore, the application can tolerate a high level of     Unfortunately, there is currently no hard data on user
customization without a significant impact on existing      expectations of enterprise applications such as CRM.
applications.                                               However, it’s clear that power users—users who are
                                                            connected most of the time to the CRM system, such
Strong Integration Framework                                as contact center employees and support specialists
In order to derive maximum value from your CRM              —have the greatest need for high-performance
investment, ensure it can be integrated with existing       CRM and will tolerate less system latency than the
back-end systems and databases.

CDC Software | The Customer-Driven Company™                                                   CRM White Paper | 4
occasional or disconnected user. Atypical, ad hoc           Also, make sure that your CRM system can support
users will have different performance requirements.         fine-tuning and adapting of the application and

It’s critical that both the CRM application and the         network-level infrastructure. This will ensure consistent

network-level infrastructure be tunable to perform          performance within infrastructure and bandwidth

within existing network infrastructure and bandwidth        constraints, optimizing the user experience.

constraints.                                                In any case, you should strive to take the safe, smart

The combination of highly scalable server                   approach to server architecture based on modular

technologies and 3-tier CRM applications is raising         building blocks, such as that provided by Microsoft

the bar for high performance architectures that can         and Intel.

enhance competitive performance. Financial services         Technology foundations like this support your CRM
institutions are moving away from isolated, vertical        initiatives while driving low TCO by letting you ‘scale
islands of proprietary data toward a more open and          right’ to address business needs. You should be able
broadly deployable computing model.                         to scale up to handle more users and more data by

Today’s financial services company requires a high-         adding resources to existing servers, or scale out to

performance server infrastructure that scales and           increase performance in the face of additional users,

adapts to every area of the end-to-end enterprise:          workload, volume, and functionality.

front office, back office, and wherever business goals      Whatever the business-level objectives are, choosing
demand the highest possible levels of application           the right deployment model (the right mix of scale-out
performance.                                                and scale-up) allows businesses to dial-in exactly how

However, the rallying cry for today’s IT group              much scalability, availability, and agility they need at

implementing CRM is no longer simply ‘scalability’          the most affordable price.

or CRM at any cost. With so many financial services
                                                            Deployment On Demand
businesses experiencing intensified cost cutting,
                                                            A deployable CRM application should be cost-effective
especially in their IT organizations, it’s important that
                                                            to install, maintain and upgrade, no matter whether
CRM application and platform vendors respond with
                                                            the organization is a multi-national financial services
flexible, sensible CRM solutions.
                                                            company with hundreds of regional offices, or a small
The first step in any scalability strategy is to assess     bank or trading house with multiple departments.
business requirements. Anyone deploying CRM
                                                            Deployability is a major factor in lowering the
needs to balance an assessment of the business
                                                            TCO of a system, as there are enormous costs
requirements of a CRM system with its impact to the
                                                            associated with deploying applications to a large—and
current—and planned —IT infrastructure.
                                                            distributed—end user base, then supporting these
For example, uninterrupted up-time might be critical        users as the application changes over time.
to maximizing customer loyalty and partner and
                                                            We believe that highly deployable CRM must possess
employee productivity. This would certainly be
                                                            two characteristics: 3-tier architecture design and a
the case in banking or trading environments. In a
                                                            modular deployment method.
commercial lending environment, the more pressing
issue may be adding capacity to the CRM database            3-Tier Architecture Design
management system to handle a greater number                A 3-tier architecture is essential for high deployability.
of concurrent users or a greater number of ad hoc           It separates the system into three main layers: the
queries.                                                    presentation layer, which controls what your users
In considering the long-term scalability of CRM,            see and how they access the system; the application
ensure your chosen system can support access                layer, where your business rules and your core
for not only full-time users, but large populations of      applications reside; and the data layer, which contains
occasional and external users as well.                      your customer, product and business data.

CDC Software | The Customer-Driven Company™                                                   CRM White Paper | 5
A 3-tier system makes it possible to utilize a                         In this Financial Services Guide, you’ve learned the
browser-based, zero-client install, zero footprint                     single overall requirement to keep in mind for your
client that simplifies deployment and ongoing                          financial services firm: select a CRM system that’s a
administration. Application customization, upgrades,                   good corporate citizen.
and maintenance are carried out exclusively at the                     When you choose CRM that is 100% designed to
middle tier, and broadcast to all users and satellites                 fit sensibly to what your financial services institution
via synchronization, allowing client-side updates to                   needs, it is easier for it to change and respond
be seamlessly communicated to users around the                         quickly.
world with no additional requirement for client-side
                                                                       Remember the three pillars of TCO: Flexibility,
                                                                       Scalability and Deployability.
Modular Deployment Method                                              Across these three pillars, the CRM you choose
A modular deployment method allows applications                        should facilitate change as your business needs
from across a CRM suite (sales, marketing,                             evolve over time.
service, partner management, etc.) to be rolled out
separately, reducing the cost-to-results ratio. This                   Pivotal CRM for Financial Services
means, for instance, that a financial services firm                    Pivotal CRM for Financial Services offers
could deploy a contact center solution, and later                      comprehensive, integrated, industry-specific
deploy a sales force automation system, followed                       capabilities that increase insight into operational
by a marketing automation solution as requirements                     performance, streamline processes across the firm,
and budgets allow. Plugging additional modules into                    and improve responsiveness to client demands.
the system should be seamless, and there should                        With discrete CRM offerings for institutional asset
be no additional infrastructure costs associated with                  management, mutual fund wholesaling, capital
integrating multiple modules.                                          markets, private banking/wealth management, and
                                                                       commercial banking, Pivotal CRM for Financial
Summary                                                                Services puts critical relationships at the core of
Deliver a unique CRM system. Requirements: Protect                     organizational strategy in a way that fits the unique
current systems. Maintain productivity.                                business processes of financial services firms.
Think long-term. Minimal cost and disruption.
Predictable, safe timelines and budgets.

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CDC Software | The Customer-Driven Company™                                                                  CRM White Paper | 6

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Description: Pivotal CRM for Financial Services offers comprehensive, integrated, industry-specific capabilities that increase insight into operational performance, streamline processes across the firm, and improve responsiveness to client demands