Differentiation – how to stand out

Retail Financial Services

Retail Financial Services

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Moderator: Peter Smith - TISA

Experts: Rosemarie Diegnan - Wazoku

This roundtable session looked to examine how to create customer differentiation in innovation within financial services. There was an amount of discussion around the resolution of problems where the customer does not receive a first class service or has a complaint. The main consensus particularly for call centres is they must solve the problem and do not stick to a pre-prepared corporate script. Do organisations miss the interaction for customer engagement known as the "radical middle." The core issue for innovative financial services firms is to establish what the customers actually want. Convenience may be less expensive but how do organisations address the radical middle. The main theme of the discussion was to think about overall customer experience and where can you meet the needs to satisfy those customers. How do we get the perfect customer experience has been demonstrated unanimously by the John Lewis partnership!

Firms should look to understand how they get their organisations the opportunity to give the full customer experience on what is your problem and how do I solve it.The group debated whether there was a disconnect between the company strategy or ethos and does this breakdown before providing perfect service or experience to the end customer. Should the corporate ethos be overridden at an individual consumer handling level? In considering service levels, don't set out to provide poor service within the culture of the organisation or call centre. Firms should seek to establish good individual culture with no negative output. This will require investment and resource to get the right culture. It was determined to be more difficult where there is no human intervention in the customer experience and concern around how you provide consistency with the digital experience and chat bots etc. Consideration needs to be given to digital experience of jackpots, telephone, digital, apps and web chat. The preferred method of improvement was not to try for big radical change but incremental improvements can be instrumental to keep innovation improving and therefore improving customer service and experience. Start with incremental improvements to culture as in “what can you do to improve your job today". Establish an everyday innovation incremental culture and innovate with small steps which everybody can keep pace with if done incrementally.

This should be tested with instant feedback from customers and there was a level of debate as to how firms research customer feedback as it is easier to keep existing customers rather than the expense of having to find and develop new ones. The culture should encourage people internally to stand up celebrate success ideas of the front-line staff and develop a culture that a volunteer with a new idea is a good thing and to be encouraged no matter how radical or off the wall. Firms should look to explore different ways for consumers to access the service whether its in-house or outsourced and is service 24/7 or six hours. The culture should encourage the fact that a complaint is an opportunity to secure a customer for life as mistakes happen it is what you do with a mistake which is the real key issue.

In terms of eliciting feedback there is a delicate balance between overloading or complicating a survey return for the customer and a simple method of response needs to be found. It was discussed that success is being had with sentiment analysis of customers using an algorithm to detect how the person sounded on the phone using speech analytics. The best research was from disatisfied customers as it is usually only disatisfied customers who complain others cannot be bothered! Within certain organisations it was the internal staff who came up with a lot of good ideas a number of them not at all practical but at least it's encouraging to create a culture of seeking and rewarding customer focused ideas from the front-line staff.

At the end of last year, we introduced the next report in our EveryDay innovation series, on Differentiated Innovation – putting the customer at the heart of your innovation programme. Wazoku's first report in the series, The New Innovation Conversation, introduced the notion that innovation applies to all businesses, in all sectors. It’s also about making innovation part of everyone’s role, in every team, every day. As such, innovation becomes the by-product of an innovative organisation. In this initial report, they  also introduced a framework to work from, based on the five pillars of innovation: Strategy, Leadership, Management, Culture and Tools & Processes.

Next, was created the Guide to Becoming an EveryDay Innovator, providing actionable and practical steps for organisations to establish their own innovation culture and build their own repeatable and sustainable innovation models. This is based on discovering their starting point to innovate, using a tool such as Innovation Pulse. This now brings us to the most recent report in the series, on Differentiated Innovation which is focused on providing customer-centric innovation. This report focused on the first pillar, Strategy, and how to include Differentiated Innovation in your innovation mix.

The innovation Mix


The innovation spectrum includes three broad categories of innovation: incremental, differentiated and radical.

  • Incremental – focused on improving existing products and services as well as continuous improvement/process improvement.
  • Differentiated – focused on medium-scale changes with low to medium risk, that involves multiple teams. Innovations in this category are generally customer focused, to create competitive advantage.
  • Radical – large-scale, radical projects, usually complex and typically requiring significant investment.

Digging deeper, what do we mean by Differentiated Innovation?

  • External, customer-centric focus
  • Clear objectives to identify and solve real customer problems with creative solutions.
  • Focus on speed to market as customer needs evolve quickly.

How to get started with Differentiated Innovation?

Getting started can be daunting but if the building blocks of innovation have been put in place through incremental innovation initiatives, it will be much easier. If your staff are already involved in innovation and your organisation encourages them to participate and listens to their ideas and solutions to address internal problems, listening to customers and other external stakeholders is a natural progression.

Here are the necessary steps, succinctly put:

  • Define the problem to be solved, which should be tied to your overall strategic objectives.
  • Involve your internal stakeholders in coming up with ideas to improve customer experience.
  • Take it a step further and involve external stakeholders, by looking at a broader group for help in delivering a better customer experience – Open Innovation

The report Differentiated Innovation – Putting the customer at the heart of your innovation programme expands on these ideas and concepts and provides real life examples from our customers such as Aviva or the British Library. To read it, head to the website to download for free.