Insights

Why Customer Journey Transformation in Financial Services Doesn’t Always Deliver On Its Promise—And How To Get It Right

Imagine starting from a blank page.

How would you structure your business and organize your teams to become truly customer-centric? How would you connect your front- and back-stage capabilities, including customer experience, operations, technology and data, to accelerate speed to market for new propositions and reduced operating costs? What can you learn from (fin-)tech companies that design their business and operating models around the customer value exchange?

These are the fundamental questions that Financial Services Institutions (FSIs) are trying to answer when embarking on a Customer Journey Transformation (CJT) program.

Many of the world’s most successful companies derive their success from an explicit focus on customer-centricity – not least Amazon. For incumbents in financial services, and other industries, this is often a departure from product- or process-centric models.

While CJT has been on the transformation roadmap for many financial institutions, bringing this to life has been a bumpy road—many FSIs have struggled to realize the desired top and bottom-line impact. With significant investment spent, shortfalls in impact and slipping time lines, it is worth reassessing the approach.

We’ve identified three fundamental drivers that will enable financial institutions to successfully refine and scale their CJT program.

Adopt a customer-centric taxonomy

While many FSIs intend to adopt customer-centricity in their new operating models, the target state still tends to be anchored in products and business processes which limits the transformation ambition. Therefore, a critical first step is to set up the right customer journey taxonomies—focused on desired customer outcomes, currently and in the future. A customer-centric taxonomy will set the right tone from the top to guide further detailing throughout all required capabilities.

Publicis Sapient has helped banking clients to define and tailor customer journey taxonomies through a customer outcome lens, departing from more traditional structures. To get there, typical organizational inhibitors such as existing PnL (Profit and Loss), product or team ownership need to be worked through. This requires surfacing concerns of key stakeholders early on and driving open discussions on the implications and challenges of alternate guiding structures.

Build cross-disciplinary teams

Front-end customer experience improvement is only one of the critical elements of a CJT program. It requires a comprehensive lens across all capabilities, front-stage and back-stage, to drive better customer and business outcomes.

Beyond CX, product and operations, every customer journey team should include technology, data and risk capabilities. Technology and digital teams are often more familiar with modern delivery models and can inject that knowledge into a broader cross-disciplinary team. This is particularly valuable when iterating proposition development to improve desirability, viability and feasibility concurrently, at pace.

However, legacy technology platforms, and the associated capabilities, are usually not customer-centric. This means CJT requires a focus on enterprise and technology architecture in the target state, supported by a transition plan that needs to be carefully managed. Data and analytics capabilities are the least represented in current customer journey models; their involvement will support the shift to more personalized journeys and allow more nimble responses to observed client behavior—an objective that is a priority for most FSIs.

An integration of risk capabilities in journey teams will allow embedding required risk controls “by design” (rather than resorting to a subsequent manual overlay), allow an early iterative discussion around risk appetite and accelerate the time to live through parallelized risk sign-offs.

An end-to-end journey design inclusive of all required capabilities unlocks further success factors: permanent cross-disciplinary involvement, the ability to define a shared set of priorities/OKRs for the journey team and comprehensive budget allocation to journey outcomes. This supports an early focus on “full stack” proposition articulation, reduces competing priorities in decision-making, drives faster dependency resolution and allows quick feedback loops between capabilities in build and run. 

An end-to-end journey operating model can be virtual, meaning colleagues from all capabilities maintain their reporting lines into their traditional capability areas while work is being delivered in journey teams, or hard-coded, meaning primary reporting lines point to journeys. Institutions need to understand the implications of each model and decide on a target to limit.

Regardless of reporting lines, a comprehensive CJ structure requires leadership that is experienced in harnessing the value potential of cross-functional teams—a rare skill set.

Moreover, linked to Customer Journey Transformation is almost always a transition to an agile delivery model. The introduction of agile, in itself, typically leads to a significant shift in ways of working and needs to be carefully phased in the context of CJT.  

Provide the right organizational support and tools

While individual journey leadership teams should be highly experienced and possess adequate shaping authority, top-down guidance is still required. This typically includes the following:

• A model journey documentation (capturing scope, organizational structure, roles and responsibilities and OKRs of the first journey)
• Guidance on commercial models (including PnL ownership and funding models for run and change)
• Adoption timelines/phasing  

We find that CJT is more successful when pursued in phases—starting with a smaller set of pilot journeys and then scaled based on learnings, rather than a “big bang” approach. Phasing should also be considered when integrating additional capabilities (like data and risk), and adapting reporting lines. Regardless of choice, the approach needs to be consciously made and communicated.

A common lesson from CJT pilots is the need for a comprehensive, up-front baseline and target state of customer journey scope. A scope baseline needs to capture all required journey steps for customers and colleagues to achieve customer outcomes, as well as all underpinning capabilities. The resulting mapping quickly surfaces the cross-capability requirements and provides guidance for the required CJ team structure and dependencies. Service blueprinting know-how can significantly accelerate this activity.

Successful customer journey transformation also requires support from core central functions like finance, management information (MI) and human resources (HR). Finance and MI teams need to help journey leadership in performance baselining and permanent reporting (including cost and PnL, if applicable) to enable value-driven prioritization of run and change activities.

HR teams need to support and guide changes in role definitions, performance targets and reporting lines, amongst other activities, to facilitate and embed the required organizational changes.

Customer journey transformation has the potential to make established organizations, both in the Financial Services space and beyond, more customer-centric and commercially successful. Success requires getting the right idea—and getting the idea right.

This series will shine a light on the practical challenges that FSIs face as they progress on their CJT path, how customer journey maturity models and service blueprinting can be used for baselining and target setting and further lessons learned from our past years of working with our clients in this space.