Technology vendors selling to banks have a special problem: The customer pool is pretty limited. In this environment, retention and references are vital.
Three years ago, Misys, a global software provider for banks, realized it was losing about $50 million because of lack of reference. . Now, after launching a company-wide project to focus on customers, in the last 24 month references contributed to a total of $200M pipeline. The bank counts 48 out of the top 50 banks as clients.
“When I joined Misys, I was looking how we treated the customer along the lifecycle,” said Martin Häring, CMO of Misys. For almost two decades, he explained, the NPS was the primary measurement of customer loyalty. However, that score is driven mostly by the last interaction the customer had and does not indicate the overall health of the customer relationship. The result is lost accounts and an inability to effectively manage the customer relationship.
The alternative, which London-based Misys branded as the Customer Health Index, breaks the customer relationship into a 10 step journey spanning from awareness to advocacy, with 3 customer-focused KPIs for each step. The company collects data from different departments in near real time and aggregates it to give decision makers a wide and deep view of the customer lifecycle.
Traditionally, different departments might come up with their own KPIs, like fixes to software bugs reported by customers. But those KPIs might not be aligned with those of the other departments. The demand to boil down each department’s goals to only three customer-centric KPIs, visible to all executives, ensures that the entire company is working together towards the goals of increased customer satisfaction, advocacy, and referrals.
In addition to the Customer Health Index, the company launched Misys Connect, a hub that helps customer-facing staff drive the conversation at each of the 10 steps in the lifecycle, with easy access to different marketing and communication materials.
Getting internal buy-in was very easy, Häring explained. It was enough just to point out the lost business as a consequence of not using such a program. The first 18 months of the project were spent ramping up the Misys Connect program. The 12 months after that were spent introducing the company to the idea of measuring the customer health across the lifecycle, making sure the processes and IT were in place to calculate and analyze the CHI in real time. The next stage will be to survey current clients to see whether the internal indicators of customer health match the client’s perspective.
“A lot of companies are very vocal about customer centricity,” Häring concluded. “But when you ask them ‘how do you measure success’ and ‘do you have a system in place to predict customer health going forward’, a lot fall flat. A lot of vendors and banks do not make use of the data they have already in their system to improve customer service.”