Gerard du Toit: Customer Episodes and Bank Loyalty

Many large banks are struggling to deliver a simple and digital experience for their customers. Gerard du Toit, a partner with Bain's Financial Services practice, discusses how leading banks are breaking down organizational silos to create cross-functional teams that are dedicated to delivering the best possible customer episodes.

Read the Bain report: Evolving the Customer Experience in Banking

Read the transcript below.

GERARD DU TOIT: Banks know that they need to differentiate in the customer experience, and in order to do so, they need to deliver a simple and digital experience for their customers, but they're failing to do so. They're struggling to deliver this delightful digital experience not because they aren't trying hard enough, but because they're organizing the work by functions within the bank and making decisions in the committees. And that's just too slow. Instead, leading banks are experimenting with new ways of managing, by managing by the customer experience—how the customer actually engages with the bank instead of the bank's functions and silos. What this means is breaking down the unit of work into the customer episode and organizing the work in cross-functional Agile end-to-end teams.

What I mean by the unit of work being the customer episode is defining the work in the terms of what the customer's trying to do. I want to buy a home. I want to dispute a fee. I want to open a new credit card. I want to pay a bill. Any of those terms defined is what the customer is trying to do with clear taxonomy of the most important customer episodes—and in standing up end-to-end teams that are responsible for delivering those experiences regardless of the channel that they come into. So it's not just the digital experience, it's all the layers of the experience—the human, the policy, the process, and the underlying systems and data.

Take a simple example of an emotive experience like I want to replace my lost or stolen card. You would stand up a team that are responsible for that whether I walk into a branch, whether I call the contact center, whether I do it online, or whether I do it in the app, or whether I ask Amazon Alexa to help me out with my lost card. This team would be responsible. And whether it's a credit card or a debit card, this team's responsible. And they're responsible not just for the customer experience but all the business outcomes—the customer experience, the employee experience, the cost, the quality, and of course, compliance as well—with the right cross-functional experts as part of the team to ensure that they do the right work.

And then they have the episode owner, who has the accountability and the authority to make the decisions to achieve those business outcomes. And this change in the way of working is transformative and allows a much faster pace of change, because instead of organizing by the organizational function, it's organized by the customer episode. And instead of managing by committee, you're managing and making the decisions in the cross-functional Agile team.

Read the Bain report: Evolving the Customer Experience in Banking