To keep up with the changing lifestyles of its customers and make banking more convenient, BankBoston this month launches the second stage of its extensive redesign program, implementing the hundreds of wishes of its customers.
BankBoston Corp., Boston, the nation's 16th-largest bank holding company with $71.4 billion in assets, collected its customer's opinions in a research campaign that used focus groups, outbound phone surveys, mailed questionnaires, Internet surveys and the company's Voice of the Customer, which prompts suggestions from many of its 35 million call-in customers.
“We went through a comprehensive process to identify ways of enhancing customer experience,” said Laurence Mariasis, the company's executive director of telebanking. “We gathered research of what customers wanted and came up with specific ideas that would allow us to address the needs of our customer to make customer service better.”
Hundreds of ideas were approved June 30 and are now being implemented over the next 18 to 24 months. A multimillion-dollar investment in technology will provide the new functionality customers requested, including immediate approval for loans and personalized menus. More information will be available across a wider boundary of items. Customers will have better access to their checking account balances, loans, mortgages, credit cards and investments directly over the phone as well as via the Internet and automatic teller machines. Agents will handle more complex needs of customers in an advisory capacity as more routine transactions are handled by automation. Callers will be directed to the agent that can best handle their needs.
“It will be a one-stop shop,” Mariasis said. The system aims to avoid annoyance caused by rerouting.
The agent handling the call will be equipped with comprehensive on-screen information to fulfill the customer need immediately. Transactions will be recorded so that agents will have up-to-date data
each time the customer calls. Marketing of products will also be directed to specific needs.
Banks are trying to model teleservices after retailers such as L.L. Bean and Lands End, who have successfully built a relationship with the customer, said John Carey, an analyst for Dun & Bradstreet. But to do that, banks must have the technology to capture a customer's bank account activity. If a rep can pick up the conversation from the last time the customer called, the bank can provide excellent customer service and at the same time lower overall operating costs.
“The redesign is about the customer, not about cost-cutting,” Mariasis said. The hope is that by delivering what the customer wants, both the customer and the company will benefit.
Still, the move, along with sale of the company's Berkshire County, MA, operation, is expected to generate aggressive returns, as promised to shareholders in statements issued by chairman and chief executive officer Chad Gifford.
The redesign will “provide the capital and resources for desired reinvestment in other areas of our regional operation,” he said, transforming it to cater more to the needs of customers and provide opportunities for revenue growth.
So far, efforts are showing results with a reported second quarter net income of $242 million, or 80 cents per common share on a diluted basis. This compares with $212 million, or 68 cents per share, in the second quarter of 1997. On a fully taxable equivalent basis, operating income (pre-tax income before provision for credit losses) was $455 million in the second quarter compared with $419 million in the second quarter of 1997.
Wall Street analysts lowered their rating on shares of the company caused by expected turbulent market conditions in markets in Argentina and Brazil, where BankBoston has recently expanded. The company, however, say analysts, has a good strategy and excellent franchise value, and an upside to earnings could surface next year.
An added advantage for the bank, said Carey, is its expanded ability to create a national presence, as it is no longer limited to the proximity of the branch office. BankBoston can reach customers in, say, California, who would call in through an 800 number.
“Customers love automation,” said Mariasis. And with the implementation of the new system, “they will love it that much more.” Near elimination of paper handling is expected. About 25 million calls are handled currently by the system, a number that is expected to increase by 80 percent in the next few years.
Calls are handled by 1,000 phone agents, but cutbacks are expected–BankBoston's Providence-based telephone banking unit recently cut 80 night-shift employees.