CRM in Investment Banking

Last weeks blog about demo tips proved to be very popular, I was given a lot of suggestions so I will be updating this article again soon (from a salesperson perspective). This week’s post is about CRM in Investment Banking. I work in Financial Services and one of my primary responsibilities is to help financial institutions understand how CRM can have a significant impact to their business and specifically how Microsoft Dynamics CRM can achieve this. One way of doing is this is to never mention the term CRM, but that’s for another post!

This will be a first in a series of posts. I loosely categorise my clients into Investment Banking, Asset Managers, Corporate Banking, Commercial Banking, Retail Banking and Insurance. I will write a post for each one of these sub verticals.

I created the following slide to use when I visit an Investment Bank, I use it to illustrate what other organisations are doing or are looking to do with CRM. It helps me provide context for the discussion and (hopefully) makes it more relevant. There is nothing truly insightful here, but it is a good way to start a discussion or demo.

I will also do a post on what an Investment Bank is but for now just be aware that an Investment Banks can provide the following products and services:

• Advisory services (Corporate Finance, M&A, IPO’s, Restructuring, Research)
• Financing (Lending, Debt Finance, Asset Finance, Syndicated Lending)
• Global Markets (Foreign exchange, Money market, Interest rates, Credit trading; Equity derivatives)
• Transactional services (Cash management payments, receivables, liquidity management, Custodial & securities services)
• Real Estate (Real estate investments; Real estate finance)
• Wealth management & Asset Management ( Institutional banking services; Offshore banking services; Private client services; Trust & fiduciary)

These are just some of the offerings, if you want more information on these then take a look here ; the products and services page from an Investment Bank.

Before I talk about how CRM can be used and how other organisations are using CRM I thought I would highlight some of the key trends and issues that I have seen in Investment Banking:

• Lack of Growth – It is no longer just about more clients, it’s about more profitable relationships
• Many complex back office applications that are not integrated – Lots of best of breed apps that are not integrated, some bespoke, some legacy
• Client Expectation – Need to reduce costs whislt impoving client service, transparancy and accountability
• Regulation and Compliance – auditability of interactions, flexibility to change, control of data
• Consumerisation and ubiquity of access – mobile, tablet and remote working
• Increasing complexity of products and market velocity – Increasing client expectation
• Simplification of process and systems – Best practice with flexibility

This is then underpinned by some of the key technology trends such as:

• Big data
• Analytics
• Mobile
• Cloud
• Platform

The good news for us who work with Microsoft Dynamics CRM is that we have a  great cohesive story to tell for all of the above.

What follows are some examples of what Investment Banks are looking to do with CRM:

Deals Teams / Coverage Teams / Activity Tracking – Ability to define entitlement rules with teams managing clients and deals with a significant degree of granularity. They want the ability to maintain control of their data yet still have the flexibility to share data across different users in teams for collaborative selling.  Ability to manage activities (call reports) and report on total client interaction. Collaboration is a key factor, Investment Banks needs to be able to collaborate due to the complexity of coverage (products and region). Collaboration enables banks to provide a better more informed service to their clients. Often these collaboration applications fall outside of the CRM system and process; this is not an effective way of working. A good CRM system should pull this information into the client workflow.

Single Client View, Insight & Dashboards (Divisional, Regional and Products) – The ability to see a single client view across different divisions, regions and products. Dynamics can provide the integration layer across back office systems (integration or view). This is what I often call the “single point of entry”, which is to say that Microsoft Dynamics CRM  becomes the “authoritative source of data” the place where people go to see client data with confidence. Microsoft Dynamics CRM does not need to be the golden source but it does surface this information in a single user interface. We have seen great success in user adoption because we are removing multiple applications and replacing it with Outlook (or the web client for those who do not have Outlook).

Complex relationship mapping – The ability to store and view the complex relationships from the Investment Banks perspective as well as from clients and any third party relationships that might be involved in the deal or relationship. With large customers having multiple touch points across regions and across products, Investment Banks needs to quickly see who is talking to who. They want to avoid duplication of work, data and calls to the client.

Compliance & Due Diligence / Swiss Data / Monetary Authority of Singapore (MAS) –  Regulations are constantly changing and these regulations put massive restrictions on the business. They need the ability to satisfy these compliance rules (client data & KYC) and need to make sure that their data remains safe behind their firewall and in region. Whilst Microsoft CRM can be deployed on premise, cloud and hybrid cloud it is the ability to deploy to their own data centers in region that give Investment banks complete control of their client data. Should regulations change then they still have the flexibility to move to the cloud on a case by case basis.

Itinerary & Event Plans &  Road shows – Managing road shows and events, making sure that senior executives are visiting the right clients in the most efficient manner has traditionally be done on an ad-hoc and manual way. Automating the process, having this data in CRM and maintaining a single view with complete client interaction in CRM gives Investment Banks the ability to simplify the process and reduce the cost of service.

Client Service Management – Client expectations are increasing, the drive to more profitable relationships mean that Investment Banks need the ability to manage client efficiently and effectively. Making sure that the most profitable relationships are receiving the best client service possible is increasingly important. Segmenting their coverage of client means that account teams and relationships managers are always in control.

Global Account Planning – Managing large clients with relationships across the globe and across multiple products is a challenge, Investment Banks need to be able to align objectives across products and divisions. Typically account planning has been done on Excel spreadsheets with each division and each region using slightly different templates. Having this data in disparate systems means there is a lack of  consistent process and it becomes difficult (if not impossible) to analyse and provide insights. Investment banks need the account planning process to be built in or surfaced right within the client record so that the relationship manager and stakeholders not only have a single view but they have insight into the plans and can implement best practice.

Client & Product On-boarding – The client on-boarding process if often managed by legacy applications or bespoke software that is costly to maintain and difficult to change. Credit checks, Anti Money Laundering (AML) , compliance and operational process are often held in a black box with no visibility to the extended client team or relationship managers. Reducing time to value is a key metric yet difficult to improve because of the lack of visibility. Dynamics CRM exposes this information so that it can be automated, alerts created and actioned.

Wallet Share – The drive to more profitable clients means understanding the wallet share of each client. The complexity of large institutions under multiple legal entities, on multiple products and platforms in many different regions means that this information is complex. CRM helps to map legal entities with the relationships so that information can be aggregated and provided to the relationship managers. This information is often held in back office systems but with Microsoft Dynamics integration capabilities this means that the data can be surfaced within the interface yet still managed and maintained in the back office system.

Automation, Alerts and Exception Handling – With the wealth of information available and the need to move faster, rising client expectations and with frankly less resources than before, Investment Banks are looking to automate as much as possible. Rather then manage each process it is about surfacing issues when they occur and manage by exception.

The above is by no means comprehensive and I’ll look to add to this in the future, for now I hope it provides some insights into CRM for Investment Banking. If you find this article interesting then you might like to read my previous post on XRM in Financial Services.

This posting is provided “AS IS” with no warranties, and confers no rights.

Next time on Mark Margolis’s Blog: My top Outlook features