On my travels talking to executives about the world of digital and Code Halos I’ve noticed an interesting disconnect. On the one hand many people, particularly the more tech savvy, clearly “get it” – they understand what a big deal this new wave of technology and business is and are totally on-board with the idea of “thinking differently”. But then in almost the next breath many of them admit – some more freely than others – that it’s very hard to do anything substantive about it; in their organizations, there’s lots of talk and lots of initiatives going on but few of them are really having much impact.
Whilst this dissonance is pretty evenly distributed, it seems – from my personal, non-scientific point of view - particularly true in the world of finance.
This odd dynamic has been close to home – literally – for me recently as I’ve been in the process of re-financing my mortgage.
So, imagine the scene; I come back from a business trip where I’ve been talking to pretty senior folks in a big blue-chip, well known, Main Street bank (no names for obvious legal and career maintenance reasons!). The bank – with an IT budget equivalent to the GDP of a small African country, and staffed with top brains from all points east and west – have lapped up our ideas and the conversation, and have been in equal parts inspired, terrified, and nonchalant, as they’ve heard us out and shared (some of) their plans and thinking.
I get home, pour a cheeky Sauvignon Blanc, and get back to the re-fi process – which is with the very bank I’ve just been presenting to. And even though the wine helps, my spirits sink as I wade into dozens of forms, a gazillion basic questions, and hundreds of pieces of paper.
“Fill in Form H, in triplicate”; “provide verbal verification of employment”; “provide proof of earnings”; “provide your social security number”. Etc. Etc. Etc.
Hang on; you guys have got all this information – I’ve banked with you for over 15 years; I have a relationship with your wealth management division. My brain starts to spin and melt-down and after a long day on the road, and a second glass of the grape to hand, the will buckles, and I put completing the paperwork off for (yet) another day.
Is it me, or is this just nuts? Have I just chosen to work with a lousy bank or is this your experience too? I have a suspicion that this is a pretty universal situation and that you may have gone through a similar nightmare too …
The bank, full of the most sophisticated technology and minds, knowing full well it is in the midst of a digital revolution, claiming to be able to do the most complex and creative customer segmentation and analysis – yadda, yadda, yadda – is running one of its most important processes with a representative of its most important constituencies (i.e. me, aka “the customer” … from whom all else flows etc) as though it is 2007; no, 1987, no 1957, no 1857.
When you look at this coldly this really does seem odd. And begs the question why?
Why can’t the bank see me through my Code Halo? Why can’t I see the bank through its Code Halo? Why can’t they populate all the forms with the information they already have about me in their systems? Why does the process take months? Why do they need to have a person go over the gazillion questions on the phone with me? Why can’t they see my salary information from my checking account? Why do they have to hurt so many trees? Why do things have to be scanned, printed, and scanned again? Why does every single page need to be signed in hand on paper? Why don’t they ask me what information I am comfortable sharing with them? Why don’t they ask me what tradeoff between efficiency and privacy I’m comfortable with? Why don’t they ask me what my preferred form of interaction with them is? Why don’t they ask whether I would be happy for them to pre-populate every form with information they already have about me? Why don’t they ask what type of exception approval process I require?
The list of questions could go on and on, but I’ll stop there for my sanity if not yours.
I don’t know the answers to many of these questions – perhaps you do, and if so, I’d be very grateful and interested to hear them if you’d care to share.
I’d hazard a guess though that – broadly – the answers are to do with a ugly mash-up of factors such as regulation, inertia, legacy systems, the non-competitive differentiating nature of the mortgage application process, industry-wide MAD consensus (i.e. if any of us big boys break ranks and try and do something “modern”, then we’re all toast), lack of purchaser power, risk aversion, profitability, complexity, lack of a burning platform, security, privacy, ethical concerns, prioritization, and then finally (again) regulation. I’m sure this is non-exhaustive.
Given such a long (probably incomplete) list, perhaps I should be a little more sympathetic to my bank specifically and all banks generically. But I don’t feel inclined to offer that sympathy. Though banks have laughed off Bill Gates’ view from 20-odd years ago that they were dinosaurs, they appear an institution and an industry ripe for disruption, and acting very casually about that risk. Any casual observer of the “fintech” scene knows that in the darkness on the edge of town there are lots and lots of new players emerging with names like Venmo and Wealthfront (to name but two).
An industry or institution that willfully sustains a second rate – nay, dysfunctional – way of doing business (for good or bad reasons) – is, in this new warp speed digital age, asking for trouble.
Back to my re-fi! You’ll be pleased to know (I’m sure!) that loins girded I have managed to make it to the end of the financial obstacle course without Wiping Out! I took comfort in knowing that the nth rate treatment wasn’t personal – even ex-Chairmen of the Fed seem to having a lousy time of it at the moment http://lat.ms/Z24yZY
Unfortunately, next year I face the prospect of having to go back in the ring with my bank (don’t ask why!); it would be nice to imagine that on the next go-round they could just open up their customer management dashboard, type “Ben Pring” and bring up my financial Code Halo; voila!
That’s what banks should be doing; that’s what their people claim they can do. Running such analog processes in our digital age is, if not the strategy of the dinosaur, certainly the strategy of the dodo. Claiming to get “digital” but then being “analog” is a tension that banks – and of course, many, many other companies in other industries as well – must resolve quickly before customers have better more contemporary options and vote with their wallets, feet, fingers, and Halos.
Anyway, I’ll update you next year on the next round of Pring low-finance. I’m not holding my breath that things will be that much better. And I guess you’re not either! We can hope though can’t we!