To get really frustrated, press 3

Call centres have certainly commanded plenty of attention over the past 10 years, and have been the single greatest technology investment for financial services organisations over that period. But have they actually solved more problems than they've created?

True, the call centre offered an alternative channel. True, it was cheaper than the face-to-face alternatives. But has it improved customer service, or customer retention? And has it really cut overall costs to business?

Investment in call centres has been massive. Industry estimates suggest that individual financial services companies spend an average of £100m a year on them.

But the irony is that call centres are not as customer-friendly as they should be. Busy call centres can mean long holding times for customers and filling out lengthy application forms on the phone can be very irritating.

They also mean that the customer has to continually educate the call centre agent with information that the organisation would do better to learn and recall from previous encounters.

And with highly scripted salespeople calling when we're relaxing after a hard day's work, the telephone has developed a reputation as being even more intrusive than the old-fashioned door-to-door salesman.

Raising the bar
On the positive side, what call centres have achieved is to raise the bar in terms of customer expectations.

The general public has experienced dealing with staff who have some prior information about them, and now they want more convenience and access to the information that the organisation has.

They want to interact at a time that suits them and not have to queue. And they want to deal with someone who is better informed about them as a customer.

But who is available at exactly the time as the customer is, and who can ever have as much information about them as themselves?

Rather than piling more and more money into ever more complex systems designed to gather information on the customer, why not harness the system which offers the most advanced understanding of the customer?

Help yourself
Customer self-service represents a very powerful alternative to the call centre. Not only does it offer the customer greater levels of service and convenience, it offers the organisation the opportunity to make major cost savings.

Personalised self-service makes interacting with an organisation easier and more productive. It nurtures high-value relationships via the internet and wireless channels, and not by pushing the customer back to the phone or employees for support.

A self-service portal can be connected to at any time without a holding delay. Furthermore, customers can complete lengthy application forms at their own pace, coming back to them if they don't want to tackle them in one sitting.

They also allow customers to access account details, carry out transactions and get answers to frequently answered questions at any time of the day or night.

Where call centres paint a picture of an organisation as being intrusive (outbound) and defensive (inbound), the self-service environment represents a voluntary access anytime, anywhere.

Where the assisted service model of call centres encourages the culture of information contained in a silo and 'local experts', the self-service model encourages shared information.

Counting the costs
Perhaps the biggest problem with continued investment in human assisted systems for relationship management is scalability. As the volume of interactions and transactions goes up, so do the associated capital and human expenses.

By contrast, an online self-service environment represents much lower fixed costs and an infrastructure where increased volume actually drives down overall costs. Front-office systems require expensive, human-assisted service and capital resources.

Gartner Group recently estimated that US businesses spent $37.5bn in 2001 manually interacting with their customers and partners.

Furthermore, other analysts predict that businesses will spend an additional $25bn on call centre software and other front-office technology in an effort to better manage the exploding volume of customer, partner and employee interactions initiated via the web.

In other words, a lack of proper self-service features on the web is driving even greater volumes of traffic through the call centre.

The benefits of both customer service improvement and cost savings through self-service can be seen at Citibank.

In a recent study of the Citibank Online customer service environment, which handles over 180 million self-service transactions per year, customer retention, a key performance indicator for the bank, has improved by 75 per cent. At the same time, operating costs have been reduced by 71 per cent.

Closer to home BT has shown a saving of £45m in the first quarter of 2002 by moving call centre transactions to self-service.

This was achieved using a single process that involved about one million transactions per year. The organisation estimates that it has over 12 million transactions that are suitable for this approach per day that can be tackled over the coming years.

So, as major financial services institutions face the next round of competitive pressures, there is a new strategy to consider. One that will offer competitive advantage in both customer service and cost-saving.

And the only downside will be that customers won't get to wait around humming Greensleeves quite so often.

BUILDING A SELF-SERVICE ENVIRONMENT

There are two essential requirements for delivering a customer self-service environment that really helps users to get what they need without resorting to the call centre:

• A genuine enterprise-level portal capable of accessing and co-ordinating the presentation of information from a variety of systems that reside both within the organisation and in partner companies.
• The ability to personalise the delivery of information to customers.

In the assisted service model, the agent's role is to help the customer navigate the complexity of the organisation's data, systems and processes. With the developments in advanced personalisation, certain interactions can feasibly be automated.

Software has to be capable of capturing explicit and implicit information about the customer and then, most relevantly, providing access to information based on this profile.

Gavin Webster is director of financial services at BroadVision.

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