It’s the support, stupid!
“The economy, stupid“: a phrase created by James Carville in 1992. It is often quoted from a televised quip by Carville as “It’s the economy, stupid.” Carville was a strategist in Bill Clinton’s successful 1992 presidential campaign against incumbent George H. W. Bush. His phrase was directed at the campaign’s workers and intended as one of three messages for them to focus on.
For providers of core banking (and other) technology to community banks, it’s all about the service and support experience they receive, or don’t, from their provider.
Over my 35 years selling core banking solutions to all sizes of community banks, we always focused on the ‘better mousetrap’. Better database, better teller system, better dashboards, better fill in the blank. We would come out of presentations high-fiving at how well the demo went. How we really nailed our differentiation and how many head nods we received from the audience. Only to spend anywhere from six to 18 months competing hard to win the business and find out that we had been eliminated.
Increasingly, we were losing to smaller regional providers who did not have all the bells and whistles that we had. They did not have the NexGen, cloud-based API portal we offered, or the global fintech experience that we brought to the table. Our teams would spend time going back and reviewing the post-mortem analysis trying to understand just what went wrong.
It’s the support, stupid!
What became perfectly clear to those of us on the ground, but less clear to the upper levels of the organization, was that we were being beat out by companies offering impeccable service and support. It finally became evident to me that all of the buzz words, leading edge technology, and even our “sales process” could not make up for basic service and support.
The community bank sector is one of, if not the most, risk averse and highly regulated sectors in all of business. While there are a handful of visionary, hard charging, “we will change the world“, CEO’s and CTO’s out there, the vast majority of the C-suite in community banking is extremely conservative (understatement!). And so here is what it took me about 35 years to distill; community banks make core technology decisions based on these three decision points and in this order:
A flawless and drama free conversion experience.
That bank you are trying to sell to had better be 110% confident that your organizations ability to migrate them successfully and on time. No customer disruption, no surprises (“oh, we forgot to quote this as part of the process”), nothing. References better be singing your praises on this. Non-negotiable.
A “we will smother you with support and attention” reputation.
Here, more than any other category is where the core providers outside of the big 4 are winning the war. Many of these companies have ridiculous customer to support person ratios. They boast that when you call them you can actually speak with a real person, every time! And they will proactively make sure that you are happy, cared for and swaddled.
And a very distant 3rd, is Technology.
Sure, the system needs to do the job, but frankly, any mainstream solution available today will run the bank. Most functionality today is table stakes, and frankly, most community bankers still view technology as a utility. They want to come in, turn it on, and have it work. No drama. They are not hung up on how it does it, they just want it to do its job.
What is the takeaway from all of this? Community banks are not sitting around thinking about how much fun it would be to go through a core migration, which means it is near to or at the bottom of their priority list. But, they will do it if they feel like they need too. One of the issues high on the “need list” is superior, delightful, shout it from the rooftop service and support. If a core provider is investing in technology and functionality but downplaying or ignoring the importance of SUPPORT, they do so at their own risk.
Please tell me what You think.
Nick Perfido | Executive Vice President | January 28, 2021