Financial services firms are evolving at a rapid pace in response to regulatory shifts and there is a pressure to respond to the disruptive forces in the industry from new sources of competition to escalating client demand. Institutions are responding by providing a differentiated client experience to foster client relationships while meeting regulatory requirements. Ideally, this experience should meet and surpass client expectations and strengthen the client relationship over the long term while creating opportunities for sustainable growth.
Client Lifecycle Management (CLM) is a structured approach to obtaining these objectives, by breaking down the client experience into its component parts – data collection, data usage, client interaction, risk management and regulatory compliance – at every stage of the relationship, from sales to onboarding to transaction processing to offering new products and services at appropriate times.
The new Accenture Finance & Risk perspective explores how a holistic and transformative CLM programme can help FSFs exceed client expectations, meet regulatory and reporting requirements, provide competitive differentiation while reducing costs and driving growth.
Using the same resources for onboarding clients and leveraging internal and external data provisos such as prior relationship records can reduce the number of data requests.
One of the key principles in CLM is to look at established processes and practices through the client’s eyes, with the understanding that strategies and tactics employed should have a direct effect upon the relationship. “We have identified three elements highly valued by clients,” says Nesrine Besbes, Financial Services Managing Director at Accenture. “Clients appreciate consistency across the approach and process. They look for one common standard across the enterprise, otherwise they end up getting the same things from different teams. Eliminating repetitive requests is likewise important as clients typically want to be asked only once for data pertaining to onboarding. Using the same resources for onboarding clients and leveraging internal and external data provisos such as prior relationship records can reduce the number of data requests.”
Clients also value increased speed and efficiency: process maturity often leads to a proactive handling of client requests. Mrs Besbes elaborates: “For example, anticipating document requirements and explaining regulatory commitments give clients the sense the relationship is being carefully valued and is managed, as well as transparency from the financial institutions as to why certain data is needed. This consolidates the partner relationship.”
Transformative and holistic
CLM presents opportunities to gain efficiencies in three areas: a flexible and configurable process enabling consistent compliance risk management; fewer manual processes which also eliminate duplicative data checks; and implementing process-driven controls. “Using proactive KPIs, rather than just responding to complaints, provides better visibility into the client’s onboarding experience and creates opportunities for process management,” says Mrs Besbes.
A transformative CLM programme can embed data privacy regulations into an organisation’s daily practices, addressing regulatory requirements for data storage and building a positive and proactive communication channel with clients. “This can help demonstrate the organisation’s commitment to addressing growing data privacy concerns,” underlines Mrs Besbes.
As clients become larger players with substantial scale or niche groups needing custom products, operating models should reflect the full view of the client.
CLM encompasses the entire client relationship. During pre-onboarding, the sales team identifies a prospective client, new product or product modification for an existing client, before moving on to onboarding, the commencement of account maintenance. Post-processing involves changes in account status, such as the creation of a new legal entity. “All of this needs to happen in CLM through profitability analysis, on the one hand, and meeting legal and regulatory compliance on the other,” underlines Mrs Besbes.
The complete client onboarding process includes pre-onboarding, onboarding, compliance, legal and post-processing. “In a pre-CLM world, each stage is managed as a separate part and new task, creating inefficiencies and friction,” explains Mrs Besbes. “As clients become larger players with substantial scale or niche groups needing custom products, operating models should reflect the full view of the client.”
There are many ways in which financial services clients can effectively use CLM to support their growth agenda. FSFs can take a major leap forward in servicing clients and respond in a timely manner to their demands by undertaking a CLM transformation programme that takes client focus, process efficiency and holistic services into consideration.