Customer satisfaction is key

An interview with Michael Marcellin, Vice President of Global Product Marketing, Verizon Business

FST. What are some of the most critical challenges facing the financial services industry that you are discussing with your customers?
MM. There are many, but three interrelated challenges come to mind: the need to integrate many disparate systems to enable a seamless flow of information; the need to maintain ironclad security while doing so; and the need to comply with industry guidelines and regulations such as GLBA, FFIEC, NACHA, and PCI.

Many of our clients have multiple business units that serve the same end customer – for example, personal banking, consumer loans, mortgages, and investments – yet they don’t have an easy way to provide a single view of that customer. Legacy systems based on proprietary interfaces create a daunting integration challenge. Fortunately, the increasing adoption of standards-based platforms is somewhat alleviating the challenge. Of course, the standards continue to evolve, and different technology vendors often have different interpretations of the standards; so the integration challenge isn’t a thing of the past, but we’re clearly moving in the right direction.

The security question is one that keeps a lot of executives up at night, and for good reason. The damage of a security breach could be catastrophic to any financial institution. So as we work with our clients to integrate and manage their networks, we have to be constantly vigilant. We protect our customers’ data using multiple levels of security, including physical, perimeter, host-based, personnel, and procedural measures.

These security measures not only protect against financial losses; they also help to address compliance requirements. A very relevant example is Payment Card Industry (PCI) compliance, which has gained a significant amount of attention over the past year or so. Merely protecting customer data isn’t enough. We have implemented a PCI program that provides online compliance tools and dashboards, along with complementary professional services for remediation, training, and Forensic and Investigative Response Services.

FST. What market trends are having the biggest impact on how financial services firms are using your technology?
MM. One of the trends that has had – and continues to have – a major impact is the ongoing merger & acquisition activity in the financial sector. It’s already enough of a challenge to tie together multiple systems and databases within a single institution. But M&A’s not only confront enterprises with a significantly more difficult integration challenge, but also a more urgent one: the business justification for mergers almost always involves the potential for cost synergies, so there is tremendous impetus for newly merged organizations to deliver on that promise.

A much different driver is occurring on the demand side: customers have come not only to accept self-service, but to expect it. Perhaps it’s an overused example, but that’s because it rings so true: Tthe widespread adoption of ATM’s is a perfect illustration of how consumers will embrace a self-service technology that provides convenience and is secure. The success of the ATM self-service model really laid the foundation for the current generation of self-service banking, namely Internet banking and bill payment services. These applications provide the convenience convenience and security that consumers demand, at a fraction of the cost of assisted transactions.

Another significant trend is the growth of mobility. Many basic services work equally well in a fixed or mobile environment, but the proliferation of more sophisticated mobile devices opens up the possibility for multi-modal services – for example, applications that allow speech input together with delivery of graphical displays and data – as well as location-based services.

One other shift we’re seeing is an increasing openness among our financial services clients to consider hosted solutions, usually in a hybrid configuration together with premises-based equipment. The fact that we’re seeing this in the financial services industry, with its stringent fraud prevention and privacy requirements, is especially significant.

Finally, a couple of other trends worth noting are globalization and personalization. Our multinational clients are increasingly interested in a single solution that can be deployed globally. And as these enterprises serve an ever more diverse customer base, they can attain a competitive advantage by dynamically tailoring their services based on the end user’s preferences.

FST. There’s been a lot of hype about Internet Protocol (IP) contact centers. Is the hype justified?
MM. Obviously we are big believers. IP-based services will help customers transform their operations by enabling network efficiencies, such as voice compression and dynamic bandwidth allocation; and seamless support for multiple-contact media, such as phone calls, email, and instant messaging. IP provides an ideal solution for customers with geographically disparate operations – including overseas locations and/or home-based agents – that need to operate as a single virtual entity. IP provides flexibility, facilitates data integration, and enables quick time-to-market for innovative new services.

FST. That sounds compelling, but let’s face it: adoption of IP has trailed most analysts’ projections. Why is that?
MM. There are a few really significant misconceptions in the marketplace that have slowed down the movement to IP; but the market has a way of adapting, and over time, enterprises will inevitably move toward a more efficient method of doing business – whether technological or otherwise – that enables them to save money and respond more quickly to a dynamic marketplace.

One misconception clouding the IP picture is the nature of potential cost savings. The initial buzz surrounding VoIP and related services was that the cost of transport would approach zero. Not only is that not true, but the idea itself has become less enticing as the cost of traditional time division multiplexing (TDM) transport has declined. Despite all that, IP can offer real and compelling cost savings. Voice compression and dynamic bandwidth allocation do deliver measurable efficiencies, and there is a significant gain from managing voice and data on a single network. Furthermore, for those customers who have already begun to deploy premises-based IP systems, network-based IP services deliver additional cost savings by eliminating the need for customers to purchase expensive gateway equipment.

Another misconception is that legacy systems and IP infrastructure become an “either/or” proposition. The beauty of Verizon’s IP contact center platform is that it is designed to support hybrid solutions with both TDM and IP terminations. This enables enterprises to dictate the pace at which they will migrate to IP.

And finally, there’s always risk associated with change. Even the early adopters have been cautious in their approach to IP, but I predict that in the next 18 months or so we will reach the tipping point. Right now, IP-based services offer the opportunity for savvy enterprises to create a competitive advantage. But soon, everyone else will be scrambling to catch up; those who have not deployed IP-based infrastructure will bear the burden of a higher cost structure, and will be unable to deploy new services and upgrades as quickly as their competitors.

FST. One of the trends you mentioned earlier was self-service. Has self-service reached a saturation point in the contact center?
MM. No; on the contrary, we see tremendous potential for the growth of unassisted transactions using speech recognition technology.

It can be argued that as an industry, we’ve shot ourselves in the foot by focusing too much on cost savings and not enough on the caller’s perspective. The result has been poorly designed self-service applications that end up frustrating callers. So we see the backlash in several areas, such as the bank that advertises “just press zero to reach a person”. or the infamous “IVR Cheat Sheet” that lists shortcuts to bypass various firms’ IVR menus.

But, fortunately, there’s an increased realization that well-designed self-service applications can deliver excellent return on investment and provide a level of service that exceeds callers’ expectations. Speech recognition technology is absolutely ready for prime time, as long as enterprises take the time to truly understand their callers’ needs, and to design, test, and tune the applications for optimal caller benefit.

FST. What new developments in speech technology will make the biggest difference over the next 3 years?
MM. One of the most exciting possibilities, particularly in the financial services arena, is speaker verification. This is the only biometric security measure that does not require the user to be physically present, and is therefore ideal for telephone-based or even Internet-based financial transactions. Speaker verification compares the characteristics of a caller’s voice to a pre-stored “voice print” and returns a confidence score. By itself, speaker verification is highly accurate; but when combined with additional measures, such as a PIN or password, it delivers exceptional protection against imposters. This is an excellent way to satisfy the multi-factor authentication requirement mandated by the 2005 FFIEC guidance as clarified by the 2006 FFIEC FAQ.

Ironically, the high-value transactions that are most expensive for a contact center to process are also the least likely to be automated. That’s due in part to the misconception that a live agent can provide better security than an automated solution. At the very least, speaker verification can be used to authenticate the caller prior to transferring to an agent, thereby offering improved security while controlling costs by reducing the time that the agent is on the call. In some cases, the improved security will allow customers to automate the entire transaction.

Finally, I’d like to point out that speech automation and VoIP are complementary technologies that can be combined to deliver innovative services. Earlier, I briefly mentioned the trend toward personalized services. IP contact center solutions facilitate real-time access to customer profiles in CRM databases; in turn, speech-enabled self-service applications can dynamically select the appropriate language, promotional messages, and service options that are tailored to the caller’s preferences. That is the future of the contact center.

Michael Marcellin leads the global product marketing team for Verizon Business, responsible for go-to-market efforts, cross-product solutions and product strategy for the company’s entire voice, data and IP product line.