This shift demands a fundamental change in how institutions approach Customer Identity and Access Management (CIAM). Traditionally seen as a cost centre, CIAM - when implemented strategically - can actually become a powerful profit driver.
The fragmented elephant
Imagine six blind men encountering an elephant for the first time. Each touches a different part – the leg, the tail, the trunk – and forms a skewed perception of the whole beast.
Similarly, various stakeholders within financial services often view CIAM through their own lenses:
- Security officers prioritise threat detection and zero-trust security
- Chief Technology Officers emphasise scalability and IT convergence
- Customer Experience Officers champion personalisation and frictionless experiences
- Chief Data Officers seek a unified view of customer data
- Chief Financial Officers demand cost savings and measurable ROI.
While each perspective is valid, a fragmented approach misses the bigger picture. A truly effective CIAM strategy requires unifying these viewpoints to unlock CIAM's full potential as a profit centre.
Unveiling the path to profitability
Imagine a leader who can see the entire elephant – a CEO or a C-suite champion who understands CIAM's multifaceted impact. Here are nine key lessons in transforming CIAM from a cost to a profit driver:
- Strategic value: The power of seamless experiences:
In a competitive landscape, seamless experiences are paramount. Strong CIAM fosters trust, loyalty, and customer satisfaction through features like enhanced onboarding, frictionless authentication, and self-service options.
- Competitive advantage through personalisation:
Personalised experiences built on a complete understanding of customer needs across touchpoints become a key differentiator. CIAM helps connect fragmented identity data, allowing for tailored services and insights.
- Mitigating emerging cyber threats:
The financial services industry remains a prime target for cyberattacks. CIAM offers layers of protection through dynamic multi-factor authentication, risk-based access controls, and password-less login options. Beyond customer access, CIAM helps identify anomalous workforce and third-party access behaviours to prevent unauthorised access and safeguard critical infrastructure.
- Fuelling digital innovation:
Converged CIAM supports secure API integration and streamlined onboarding of third-party providers (TPPs). This allows for seamless integration of financial products into non-financial experiences. Imagine applying for a loan within a car dealership app or managing investments directly on a wealth management platform.
- Building trust through privacy-driven experiences:
Customer acquisition costs are soaring across industries. Financial institutions must prioritise customer loyalty and lifetime value. Modern CIAM empowers customers to control their data, fostering trust and long-lasting relationships. Giving customers the power to manage data sharing and usage allows for the development of differentiated privacy experiences.
- Optimising operations for efficiency:
Efficiency and cost savings are driving investment decisions across financial services. CIAM promotes operational efficiency through self-service options and streamlined identity verification. Additionally, CIAM offers deployment flexibility across various cloud and on-premise environments.
- Building profitable ecosystems and partnerships:
Financial institutions increasingly rely on partnerships with fintechs and infrastructure providers to deliver innovative customer experiences. CIAM plays a crucial role in facilitating secure ecosystem expansion, secure TPP access, and open banking consent flows.
- Investing in scalable solutions:
Delivering hyper-personalisation across channels is crucial and leading financial institutions set high bars for digital performance. CIAM solutions built for scalability can seamlessly manage millions of identities and transactions across diverse geographies and regulatory environments.
- Cultivating a culture of continuous improvement:
Agility is key in delivering seamless customer journeys across the financial services landscape. Converged CIAM enables building, testing, deploying, and iterating on customer experiences through no-code/low-code tools. This reduces reliance on specialised developers and provides access to a wide range of third-party solutions for biometrics, identity proofing, and strong customer authentication.
Embracing CIAM as a strategic investment
By embracing a holistic CIAM strategy, financial institutions can unlock a multitude of benefits. These include:
- Enhanced customer loyalty: Seamless and secure experiences coupled with data privacy controls foster trust and loyalty, leading to higher customer retention and lifetime value.
- Increased revenue opportunities: Personalised offerings and frictionless access to financial products translate to higher conversion rates and cross-selling opportunities.
- Reduced operational costs: Streamlined identity verification, self-service options, and automated access management processes free up resources and optimise operational efficiency.
- Improved risk mitigation: Robust authentication, access controls, and anomaly detection minimise fraud and account takeover risks, ultimately protecting both institutions and customers.
- Faster time to market for innovation: Streamlined onboarding and secure API integration enable rapid development and deployment of innovative financial products and services.
A profitable future with CIAM
The financial services industry stands at a crossroads. CIAM, once viewed as a technical necessity, now presents a strategic opportunity to unlock a wealth of benefits.
By adopting a holistic approach that considers all stakeholder perspectives, financial institutions can transform CIAM from a cost centre to a powerful profit driver.
This transformation will not only enhance customer experiences and build trust but also fuel innovation, optimise operations, and ultimately drive sustainable growth in the face of an ever-evolving financial landscape.
