Insightive.tv: Can you begin by walking us through the digital aspects of your end-to-end customer on-boarding process?
Mark: Speaking very basically, we sell four products — an ISA, a bond, an annuity and a pension. The level of digitisation varies between these, and this is mostly directed by the nature of the product.
The ISA is fully digitised, you can purchase it online in ninety seconds. You fill in your details, and providing you are based in the UK, the entire process can be completed online. And that is because it is a very straight forward product, particularly compared to a pension, bond or annuity.
With pensions — it depends on the type of pension, and who you are. If you are an employer, purchasing through the auto-enrolment legislation that came out in 2013, we have a fully digitised process where an employer can go on, get a quote for a pensions scheme, and if they accept the quote they can go on and set up the scheme in literally a matter of minutes. If they have a list of their employees linked to their HR or payroll system, they can then upload those members and it is all straight through. In that case, there is no filling in of forms in the traditional way. In the past, you can imagine that there would have been a whole host of paperwork that needed to be done along with that.
The digital availability of bond products varies. But then for something like an annuity, you can’t buy that online and have to do it over the telephone. The number of checks and non-automated processes required in the purchase of a product is typically determined by the complexity of the product and the checks that we need to do during the sale.
Insightive.tv: What are the biggest challenges you face on these different channels?
Mark: An overarching challenge is making sure that customers understand the products, and that is a challenge that scales with the complexity of the product. I think some of the earlier iterations of financial websites were designed by product experts, and that applies to us as much as other banks. But writing product information from the perspective of someone who already understands the product in detail, is the wrong way to go about the process and increase the risk that a customer might buy a product without truly understanding what it is.
An anomaly in financial services is that customers won’t always tell you that they don’t understand the product, some are embarrassed to admit it. And that is a real worry for us. We have gone through a transition of trying to only start with what the customers are telling us. I think you have to be obsessed with that and avoid developing products that aren’t as streamlined and customer-focused as they could be.
To achieve this we created a new development process. This involves going through three iterations. Workshops with our customer, an alpha and beta release, and then a gold product that is given out to all of our customers. Through that process, you find that the entire customer journey often changes, and that is driven by what the customers are telling us. That was certainly one of the big challenges in recent years because bringing the outside in was new for us.
Insightive.tv: Do you use third parties to create your digital solutions?
Mark: It is slightly complex to answer that. We have partners. I have an in-house team available to me, but we also use third parties to do specific pieces of work. We may design it, and they may build and test it. In some cases, they may help us design it. For some of the digital journeys, such as the ISA process, that was developed by a third party in New York called TrueOffice. We have not gone out and purchased pre-packaged software, but we have picked partners according to what they are best at. For example, we picked TrueOffice because they were the only ones that we saw and thought “we could not do that ourselves.” They are a tech company that also works from a behavioural psychologist’s perspective. This allowed us to get an expert understanding of how people psychologically look at websites, particularly financial service websites, and structure ours so that it had a greater chance of being understood. This fit very well into the demands of ours that have been a high priority for the last three to five years.
Insightive.tv: Can you give an example of how you have specifically ensured your website is effectively communicating the information you need it to?
Mark: What we have incorporated into a couple of our digital journeys is that we ask a question in multiple ways in order to check the understanding of the customer. Specifically, for example, last year legal changes created a situation where customers are allowed to take out their pensions if they are over fifty-five. But if the pension is over a certain size, they end up paying a large amount of tax to do this. If you were doing this online, the system would attempt to test your understanding with multiple questions, and then might judge to insist that you call somebody if only so someone could check that you understand what you are saying. You can design those safeguards for customer understanding into digital journeys.
Insightive.tv: Do you see it as important and possible for the entire customer journey to be digitised end-to-end?
Mark: At some point it does seem like that will happen. We are certainly experiencing demand from customers. They are comparing us to the likes of Amazon and John Lewis. If you can order a parcel to arrive at your door in an hour, why do you not have the same service for an ISA or a pension? And I think this is a reasonable demand, so it is one we are fulfilling where the conduct risk makes it possible.
I think that there are challenges to that. What you can’t do is take an existing business process and just replicate it. You have to think about how it feels to a customer in a digital world — hence my point about asking the same question multiple times to check the understanding of the customer. The beauty of digital, against particularly paper-based processes, is that you have web analytics, which helps you understand what the customer did on the website — did they read the documentation you sent them, or look at certain parts of the website? That helps you think about how you have designed the website to give you the confidence that the customer is looking at what you want them to see. If you sent them a brochure in the past, you would have no idea if they had even seen it.
The future may contain changes that are different from just creating simple straight -through automation. We are currently investing in using data more effectively to improve the quality of the service that we provide. You can pick up pain points for the customer before they even tell us. It also allows us to provide the customer with suggestions about what products they might find helpful for their financial planning. I think people want this, and it allows us to transfer from being a reactive digital experience to being a proactive one that is more valuable to the customer, all while being easier and faster to interact with. We are increasingly using data to drive that — predictive analytics is definitely becoming more important. I think that the goal is to have an easier to understand front end that is as straight-through as possible.
Mark Dixon is CIO at Standard Life and is leading an agenda of digital innovation within the company. We spoke with Mark to get an understanding of how evolving customers’ digital experience is playing a role in the larger digital transformation processes going on at Standard Life.
Standard Life was established in Edinburgh in 1825. Today it is a global investment company helping people to invest and manage their money. Around 4.5 million customers and clients across 46 countries trust Standard Life with their financial future – and they are responsible for the administration of £328 billion of their assets.
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