Over that last 10-15 years the mortgage industry has seen a number of technological innovations, DOS to Windows based LOS systems, Window’s to web-based LOS’s, AUS systems, rules based workflow, online origination, imaging, and decisioning technology, to name a few. The majority of these innovations have been primarily loan centric. Loan centric systems focus on the specific loan or transaction. But what about the customer?
Will 2009 be the year that vendors deliver customer centric solutions as the mortgage industry looks to reshape and redefine its’ future? Customer centric solutions take a more holistic view of the borrower and their relationship with the lender compared to the narrow view of that one specific transaction that loan centric systems provide.
This approach provides much greater detail about the borrower, all of the opportunities of that borrower for the lender, and much greater transparency to properly access risk. Does that borrower also have CDs, checking accounts, savings accounts, or other investments with that financial institution? Has that borrower repaid previous loans, have they defaulted before, how many referrals have they provided that lender, do they have multiple loans mortgage, car, student loans, home equity etc?
Customer centric solutions also look to how that individual prefers to interact with the financial institution. Does that borrower prefer to deal with an individual face to face at the branch? Do they prefer to be online when it is convenient for them to do business? Understanding the borrower and their specific situation, financial needs, and how to engage them from a holistic vantage point can lead to a better customer experience while allowing the lender to make more informed decisions.
So how does the vendor community embrace this customer centric approach? Look for the right problems to solve instead of chasing the next “big thing”. Vendors often get caught up chasing what they perceive as the next big thing. Their sales teams and business development departments offer a host of ideas that vendors put into a pipeline and filter through to arrive at a short list that their development teams can begin working on. Once this short list has been created the vendor then seeks additional input from customers, strategic partners and other stakeholders to determine what ideas to pursue.
Customer centric innovation approaches this from a completely different view point. Instead of following the traditional path, where customers and strategic partners are surveyed on their wants and presented with possible solutions; customers and strategic partners become fully integrated within the process by assisting with and identifying the right problem for innovation to solve.
Work with customers (lenders in this scenario) to identify the correct challenges that they are experiencing for innovation to address, instead of asking them for the solutions they want. Integrating customers into the problem identification process requires more than just surveys and brief discussions at trade shows to actually observe customers in their unique and specific environments.
When undertaking this customer centric approach it is vital to understand that true innovation may not come from product features and functions, but from how the customers experience and interact with your product and services. This includes how they search for products, when they use your products, delivery of your products and services that can lead to experience innovation. This experience innovation is something that can differentiate products and services that have parity in the marketplace.
As we pull together in 2009 to redefine and reshape the mortgage industry, I am cautiously optimistic that vendors will embrace more customer centric innovation to address the true problems at hand.
