sumo Ce if ts pete May & Acces Ne ins. econ be cit (2) 5929672 The big reason why large banks are buying expensive CRM systems is to ‘get small’ enough to compete with their community bank adversaries. 98 SEPTEMBER 2002 ABA BANK MARKETING Do Community Banks Even Need CRM? [i see before # oun of bankers in Minneapoly Mark A. Nata, Jdeputy comptroller of the US. Office of the Comptroller of the Currency (OCC), made the point that community banks, which compete on the basis of excellent customer service, are anything bot dinosaurs While large banks have more capital and financial resources than smaller banks, big financial institutions have grown too far removed from their “food supply” their customers, Community bankers see their customers every day ‘One of the “buzz words” in banking toclay is CRM (customer relationship manage- ment). ‘This usually refers to expensive software and application integration projects intended! to make big banks look and act mone like small banks, I am inspired to com- pile the following “Five Reasons Why Sauall Banks Don't Have to Worry About CRM. Wie akeodykaow oor cstomers. CRM systems ae installed Yo help the giants know their ‘customers across the “enterprise” (read ‘silos. Large banks are often bureaucracies of narromly focused specialists who cantor wont connect the dots when it comes to serving customers. This poor service i not the fault of usually well-meaning ‘employees, but the unintended consequence of the missteps of far-removed 1 ‘agers. Community bunkers, on the other hand, see their customers every day, lis ten to their problems and connect the dots in realtime We don't nod market segmentation. CRM systems are big on segmenting customers into groups and then parsing out service and attention according to who you are, This is a good idea, of course, The realty i, community bankers do this on a one-o cone basis, instantaneously. While big banks are spending more and more money trying to engineer a data mining system to help serve that lusive “market of ane ‘community banks do t spontaneously and quite well We dready know the problem, One of the great promises of CRM systems is that they «quickly surface customer problems so that they can be solved somewhere and the customer relationship saved. Satisfaction surveys identify “quick problem resol tion’ as one of the holy gras in our business. The fact is community banks already know the problem and have it solved before itis ever entered into the “system, Thats because the customer is right there in their layer of management to work through, things happen fast ices screaming. Wih only one We cready havea staffing model. Another great promise of a ‘robust’ (J love that word) CRM model in a large bank is that with eventhing captured and regurgitated in a toully digital environment, the branches will have a scientific “mexel” with which to staff their branches: that is, way to make sure that there are enough rellers there ‘when the customers are there and not too many when they aren't In a communi thank, the president, the HR manager, and the CFO work this out on the hack of n envelope. They instinctively know the “correct” wait times, processing times and rival patterns. I's only when you get three layers away from the customer that things begin to get murky Wie ceody hove hopy, wel-atid bonkers. 1: i also ofien premised that a CRM. pro> gram will allow banks to reduce tumover and build a staff of happy bankers, becituse it will be a more enjoyable place to work. Good bankers get satiation from being able to help their clients, and a $20 million CRM system will put every- thing at their fingertips so that this can happen ‘crass the enterprise.” Well, in most community banks I know, seasoned, well-qualified bankers abound. They like their jobs, fel well respected as professionals in their community and ane truly adding value to their clients So, maybe it’s rue that the big reason wiry large banks are buying expensive CRM systems isto “get small” enough to compete with their community banks ackversaries. MlCopyright © 2002 EBSCO PublishingCopyright of ABA Bank Marketing is the property of Bank Marketing Association and its content may not be copied or emailed to multiple sites or posted to a listserv without the copyright holder's express written permission, However, users may print, download, or email articles for individual use.