Know Your Customer – or KYC, is a commonly understood phrase or acronym amongst those in the financial services industry. It generally describes activities and processes that relate to due diligence and compliance, undertaken in order to ensure the financial institution can identify who they are doing business with.
Essentially, it is about verifying that the customer is not a fraud, terrorist, money launderer or any other undesirable category of person, in which case, well, perhaps you would have ‘Known Your Ex-Customer’ – KYEC.
At a time where most consultants are touting customer centricity (or whatever they choose to call it: design thinking, a coaching approach, etc) as the critical ingredient for remaining viable in a landscape of massive and ongoing change, is there an opportunity to see KYC as more than simply a way of identifying and excluding those who you don’t want to do business with…?
In many large organisations these processes take place as part of sound risk management which is common practice ‘anyway’. For smaller businesses they can be a ‘nice to have’ – or a ‘we know we should, and we would if we could’. However, what if KYC wasn’t seen as an overhead, or a ‘cost of doing business’, but instead as a function of marketing and sales?
Here is something to consider. Imagine if you could put the information you discover through KYC processes, such as the full picture of a company’s ownership structure or the various directorships held by one individual, in the hands of your frontline. How much of the information that your risk team already knows, is your marketing team trying desperately to interpret from a combination of email campaign results, website heat maps and Ouija board evenings? Since the marketing team is the one in touch with the customers, perhaps they would benefit from being more involved with KYC . Food for thought anyway.
At Encompass, our marketing team goes to great lengths to stay in-step with our customers and understand what’s important to them, our version of KYC, including:
– Appointing dedicated field staff who work with new customers to help them get set up with Encompass, while observing and learning how they use the product.
– Systems for tracking and prioritising product enhancement ideas that come from customers via our support desk or sales teams.
– Undertaking Design Thinking interviews together with our partner SAI Global in order to build customer personas that we can test new ideas with.
– Establishing a Customer Advisory Group to share prototypes with, validate ideas and provide feedback in general from the point of view of their profession or industry.
– Internal knowledge sharing platforms that enable any member of Encompass staff to capture customer insights as they learn and then share for the benefit of the whole company.
Deepening and building the understanding we have of our customers is an ongoing exercise. While putting risk management practices such as KYC solely and wholly in the hands of your sales and marketing colleagues may be taking it to extremes, I’m sure you can appreciate the value of at least having the information in a format that is easy to understand and share across teams. Furthermore, the potential to derive efficiencies by leveraging efforts (that in many cases are already being made by our risk and compliance colleagues) should not be overlooked. Perhaps its time to shift your perspective to really leverage the information from KYC.
Alex Ford is the Marketing Manager at Encompass Corporation. Read more from here.
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