Cyber masters of customer insights

Tens of millions of customers around the world routinely share a huge array of invaluable business intelligence with financial services companies. They let these companies know where they work; how much they earn; when, where, and how they access services; at what time they pay bills and deposit and transfer funds; and what products they buy and from whom. Through metrics, companies know whether they are engaging effectively with their customers about loan rates and other financial information, messages about new products, and the services they provide. But with billions of bytes surging through their systems, will financial services companies also grasp the critical role that their leaders play in laser-focusing a blur of data, with analytics, into game-changing customer insights? This booming business intelligence area, with the right leaders in place to guide strategic and tactical mining, could provide an important way for financial services companies to develop sustainable growth and to create value in ferociously competitive markets.

Financial services companies need to stay ahead of rapidly evolving technologies: Big Data, the Internet of Things, mobility, and security. Existing tools need to be developed more aggressively to derive critical customer insights so companies can retain and build business, identifying not only the products and services with appeal now but also anticipating consumer needs. Retailers have long polished such approaches, including analyzing customer purchase data to predict before the women even knew it themselves that some soon would be mothers. Using data that they can extract at increasingly granular levels, businesses can create targeted appeals so consumers get relevant offers or services at the right moment, right price, and in the right channel. Financial services companies can use customer insights broadly to create new service offerings and, more specifically, to provide customized customer support. Because customers are no longer locked into making a trek downtown to a granite tower to confer with a busy banker, today’s financial services companies must be more agile and responsive to customers who are racing across the Internet to find financial information, services, and products.

Institutions that want to flourish will need to tap robust customer insights to create the ideal user experience for banking and personal finance customers. Indeed, organizations in other sectors already are amply demonstrating just how vital it can be to establish a strategy that focuses on the next best offer, meaning that companies don’t just aim to provide their clients the best goods or service now but also to apply data and analytics to secure the next transaction and the one thereafter and thereafter.

A financial services company shouldn’t be complacent about fulfilling a customer’s utility payment with a check; it should be encouraging her to receive and pay her bills online. The company can’t be smug about landing a client’s mortgage; it should be handling all his investment activity, including providing him, when the time is right, with a virtual reality presentation that shows how his 401k will draw down over two decades, how smart he was to have bought recommended bonds, the retirement home he’ll finance, and the many golf courses nearby. Companies in other sectors already are applying online tools, including customer surveys, experience-based and real-time tracking to improve customer insights. And of course by monitoring and mining available consumer information, financial services companies— for their own protection as well as their customers’—must bolster cybersecurity, helping to detect fraud and malicious activity directed at individuals as well as at institutions.

Talent will play a crucial role in helping directors, CEOs, executives in the C-suite, and financial services companies as a whole make the necessary digital transformations, Korn Ferry research, experience, and market knowledge indicate. All organizations must align their talent with their business strategies to succeed and may find this a hard to achieve goal. Many financial services companies will find they need external expertise, which Korn Ferry provides, to recruit, retain, and develop the talent needed for their digital transformation, especially in customer insights.

Finding the right talent with the right experiences, skills, and traits.

Highly skilled, agile talent fuels companies’ growth. Leaders who help them achieve business success through customer insights must possess a complex range of experiences, skills, and traits. With the emergence of Big Data, cloud computing, digital marketing, mobile apps, and social networks, executives who are focused on customer insights need to be innovative, learning-agile, and transformative, Korn Ferry has found. They must be skilled at figuring out the future, thinking outside the box, and always positioning their organizations ahead of the competition. Because data, analytics, and market insights are shifting rapidly, executives must move nimbly in response, making learning agility mission-critical. Korn Ferry research has established the value of assessing for learning agility in high-potential talent, and the firm’s data identify it as a valid predictor of long-term leadership potential. Korn Ferry research suggests that only 15% of the global workforce is learning-agile. When these individuals can be identified and developed, the payoff for the company is significant. Korn Ferry found that companies with highly learning-agile executives have 25% higher profit margins than other companies in the study.

Bridging the digital divide.

Financial services companies have a long and understandable histories and cultures of risk aversion, tradition, and, yes, insularity. Who can rapidly transform these organizations so they become as agile, nimble, and responsive as consumers and markets demand? For data, analytics, and consumer insights to achieve the traction they need to succeed, executives in this area must find a fit with the organizations they join. They need to work seamlessly with their C-suite colleagues and others across the company and be able to drive big changes in people, practices, policies, and institutions. Can the C-suite newcomer partner with the chief technology officer, chief information officer, and executives heading up such areas as risk management, cybersecurity, legal and regulatory affairs? A chief reason that leaders fail on the job is not due to a lack of skills; it is a poor behavioral or cultural fit with the organization. Korn Ferry research shows that 40% to 60% of executives fail and up to half of new executives quit or are fired within the first 18 months with a new employer because of poor fit.

Capturing the knowledge flag.

Financial services companies embarking on successful integrated data, analytics, and market insight operations already are encountering big technology challenges in creating the best architecture and ensuring top-notch execution in their systems. Will leaders of this area in financial services companies be information technology-based or marketing-based or both? Will technology leaders suddenly need to master marketing and will chief marketing officers need advanced computing hardware, software, systems, and analytic expertise? Korn Ferry research has found that some next-generation organizations have embraced an alignment that removes barriers between marketing and technology so they exist in the same department with the same leader. The result is a collaborative, deeply integrated ecosystem that can more easily carry out enterprise strategy and enhance the customer experience while being supported from the top. As already discussed, retailers have made progress in their digital transformation to apply customer insights and to use Big Data, and they have developed executives who lead these areas from the C-suite. As comparable executives emerge in financial services companies, can they capture the knowledge and experiences from other business sectors to move their organizations ahead?

Korn Ferry’s four dimensions of leadership and talent.

Four dimensions govern human performance in the workplace (see Figure 1, KF4D): competencies, experiences, traits, and drivers. Korn Ferry research shows these four areas to be highly predictive of performance differences and correlated with all key talent variables, including engagement, retention, productivity, leadership effectiveness, and leadership potential.

Figure 1. KF4D

Korn Ferry’s executive search framework can help hiring teams clarify their understanding of how well a candidate fits with their organization. Underpinning this framework is Korn Ferry talent intelligence, which is built on more than 2.5 million assessments and profiles of seven million candidates.

The Four Dimensional Executive Assessment is an innovative tool built into the Korn Ferry search process; it provides the most holistic perspective on the market today covering candidates’ competencies, personality traits, motivations, and experiences aligned with the new role. The assessment captures, synthesizes, and visualizes unparalleled candidate insight and delivers it to the hiring team in real time on any computer or tablet. By partnering with Korn Ferry, organizations have the ability to predict how well leaders will fit and perform before they are hired.

For financial services firms, this kind of information may prove especially decisive because of the demands these employees will encounter and their potentially different backgrounds. Because the field is evolving so rapidly, candidates in this area may not, for example, possess the years of corporate grounding of many other C-suite executives, directors, CEOs, and other C-suite aspirants, clients tell Korn Ferry. Some may come from outside the financial services sector and from seemingly unrelated industries, research institutions, and technology organizations. They need to be comfortable maintaining their existing contacts while working fluidly in a new organizational environment, especially with board members, the CEO, and fellow C-suite members. Can a candidate effectively create a successful, robust role for herself, including her reporting and working relationships? Executives with critical roles and responsibilities in data, analytics, and customer insights need to be savvy about navigating a new organization’s people, practices, policies, and procedures, not the least of which would be those dealing with budgets and allocation of resources. A resume and even multiple interviews with seasoned executive talent evaluators in a financial services organization may not offer hiring teams sufficient grasp of candidates’ potential. Evaluators need to be assisted by talent frameworks, assessments, experience, and expertise, which Korn Ferry provides.