Finance: the overlooked customer touchpoint
To achieve the kind of repeat business that makes a company profitable, you need the whole customer journey to be as smooth and effortless as possible.
The new frontier for customer experience (CX) is the finance department. Increasingly, client metrics such as customer retention or net promoter score are being applied to the finance functions. Clever organisations want to ensure that all the customer touchpoints are providing high-quality service, making the journey as straightforward as possible and giving the customer no reason to look elsewhere. And the finance department has a surprising number of touchpoints that, done well, can improve customer service and satisfaction.
But CX is about more than keeping existing clients happy; paying attention to the whole payment-cycle process can identify issues that could have real benefits to the bottom line. So, for example, if customers are able to access all documentation along the payment cycle, it not only cuts costs and the administrative burden of hunting for lost invoices or chasing late payments, but the streamlining also improves customer relationships, making it easier to interact and do business with your company.
Moreover, it is often the finance department that can first spot a problem; is there a reason why a customer has not paid an invoice on time, for example? It might indicate dissatisfaction with the goods or service provided, a dissatisfaction that can be noticed and addressed before becoming a bigger problem.
The new frontier for customer experience is the finance department
The relationship between good customer service and business success is obvious in the abstract, but often forgotten in day-to-day interactions. Customers are the heartbeat of any organisation so maintaining a healthy relationship with them crucial to profitability. Consumers are increasingly demanding; expectations have been raised within the past decade by the likes of Amazon and Google, and now customers demand a level of personalisation that can be hard to achieve with old-fashioned systems.
According to Accenture’s Put your trust in hyper-relevence report, a third of customers in 2017 abandoned a business relationship because personalisation was lacking. Yet while sales and marketing departments have embraced the concept and create perhaps ten to fourteen different personas among their customers, many companies still treat everyone alike when it comes to finance with the same invoices and the same payment terms. But understanding the customer’s point of view could reap rewards; there could be a simple reason for persistent late payment.
The finance department is an unfairly overlooked area for CX improvement. This may be because the CX world tends towards hooking in new customers: a very different proposition to the steady maintenance of relationships, the means by which the finance department can influence customer retention. A recent paper from Forrester Research, Winning the Connected World, found that marketing and business key performance indicators (KPIs) are poorly connected. Despite the best of intentions, “marketing and finance departments see the business in different ways”, according to the report. Only 15 per cent of respondents said marketing and finance worked collaboratively towards shared goals.
Aligning success metrics
Key to changing this situation is to align KPIs for both sides of the equation. Forrester Research found that 46 per cent of marketers identified increasing customer lifetime value as a primary KPI; but for 51 per cent of finance respondents, the primary KPI was revenue generation. Such a disconnect can lead to different departments pulling in different directions with the customer as the casualty.
Ensuring the finance department’s KPIs include CX metrics can be transformational, but does involve behavioural change within the organisation. Aligning KPIs demands different functions work holistically together, accessing the same data, but too often data is still siloed within a company, doubling up the administration costs.
Equally critical to setting sensible, customer-centric KPIs is an understanding of the supply chain process. This ensures there are no failures of communication between, for example, the sales and the credit risk departments that could impact customer expectations. So the sales team needs to be able to see all the critical financial data on an individual customer to be able to sell not only the right products but also the right amount, without exceeding credit limits.
Seeing beyond the numbers
Conversely, the finance team needs to see more than the numbers for a customer. Knowing that a particular customer is unhappy could allow the finance team to provide a little more TLC through the payment cycle, potentially smoothing ruffled feathers and saving the company from losing a customer.
Improving the transparency of data pools will in turn improve functions from sales to supply throughout the company. The value of one communications platform is enormous, connecting data points throughout the company. Key is the concept of “one source of truth”, so all staff read the same data from the same platform. Even now, many organisations still rely on Excel spreadsheets, with all the attendant dangers of formula and data-entry errors. According to the Association of Chartered Certified Accountants, employees waste up to 75 per cent of their time rekeying and manually rolling up data.
For too long business has been focused on enterprise resource planning (ERP) systems as the solution to all ills. Certainly, ERP can help break down the barriers between business functions, improving customer services by providing one source for billing and relationship tracking. But they are often complex and slow, a stumbling block to digital functionalities, such as online contract and document management, e-invoicing and integrated credit management. Such systems provide valuable business intelligence and analytics for management, but look at processes and information from the company rather than the customer’s point of view.
It is time to turn round and ensure every touchpoint meets the customer’s requirements. It’s time for finance to step out from behind the desk and join the CX revolution.
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