Call Centers Are the Strategic Key to Profitable Branchless Banking

By Orr, Bill | ABA Banking Journal, February 1997 | Go to article overview

Call Centers Are the Strategic Key to Profitable Branchless Banking


Orr, Bill, ABA Banking Journal


Nearly all banks operate call center's to support their retail customers, but most aren't getting the bottomline results they expected. That disappointment will likely grow as branchless banking picks up speed. The reason: most bank executives aren't clear about their strategic goals for call centers---which should be to make them profit centers, not cost-containment fortresses. Moreover, the success of Internet banking depends absolutely on getting it right with call centers.

These disquieting conclusions emerge from a recent study for ABA by Financial Training Resources, Inc. (FTR), a technology-oriented consulting and training firm based outside Chicago.

"Call centers are a relatively new way of delivering bank services to customers," says Anne Livingston, ABA's associate director for retail delivery systems. "This partially explains why full benefits have not been realized. But the findings also indicate that banks should rethink how they view call centers and set them up within their corporate structures."

The ABA/FT Research stud'./analyzed the callcenter experiences of 120 banks that ranged in asset size from less than $250 million to more than $50 billion. Respondents that classified themselves as "leading-edge" institutions set higher goals for call centers and got significantly better results from them than did other banks. "Leading-edge" banks were three times as likely to run their call centers as profit centers. They targeted and ache/red increased sales and cross-sales, reduced live customer-service calls for routine transactions, and retained a high percentage of customers.

Banks that went for cost savings assigned their call centers to operations managers, while "leading-edge" banks tended to assign theirs to marketing managers. Cheryl O'Donoghue, vice-president and ci/rector of marketing at FTR, notes cost-oriented call centers try to keep calls as short as possible. In contrast, profit-oriented centers keep customers on the line as long as necessary to capitalize on valuable marketing opportunities. They invest if] database-marketing systems and integrate calls into their workflow infrastructure. …

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