“Clients Should Be At The Centre Of Your Business” – So What’s New?

The more you engage with customers the clearer things become and the easier it is to determine what you should be doing, the author explains MicroSave’s Market-led approach.

“This may seem simple, but you need to give customers what they want, not what you think they want. And, if you do this, people will keep coming back.” – John llhan, Crazy John’s mobile phone retail chain.

“Investing in quality talent, and ensuring they have the skills, training and tools that enable them to empathize and actively listen to customers are central to providing consistently excellent service experiences.” – Jim Bush, EVP American Express

I remember meeting my Father in 2000 and trying to explain to him what I was doing with my life. “I am running a project that helps financial institutions put the customer at the centre of their business and build products, processes, pricing and marketing on the basis of customer needs”. He looked at me as if I was from Mars, and said, “They don’t do that anyway?”

My Father was ahead of his time, but even in 2000, business 101 courses had figured out that a market-led (as opposed to product- or sales-led) approach was the key to success. Understanding clients’ perceptions, needs and aspirations is the foundation for successful business.

Initially inspired by Stuart Rutherford, for 15 years MicroSave has used a wide variety of qualitative research techniques to understand these perceptions, needs and aspirations. On the basis of the resulting insights we have not just innovated to build new products, but also achieved a series of much lower cost “quick wins”, through tweaking existing products, delivery systems and communications, in response.

From 2001-2007 MicroSave’s ten partner financial institutions in Africa developed or refined 9 savings products and 11 loan products.  These products were used by <150,000 customers in 2001; by the end of 2007, they were being used by nearly 2.5 million people – a growth of more than 1,500%.  The savings balances in these 2.5 million accounts soared to more than $530 million (an average balance of $212).  At the end of 2007, 373,705 customers had outstanding balances on these loans were $300 million.

So we had made important stride forwards, but two important and valuable new approaches have now been added to the mix.

“Human-centered design. Meeting people where they are and really taking their needs and feedback into account. When you let people participate in the design process, you find that they often have ingenious ideas about what would really help them.” – Melinda Gates in Wired

Human (or User) Centred Design has, in many circles become short hand for “ask your customers and/or conduct mystery shopping” –and of course there are many ways of doing this. However, HCD approaches have highlighted a very important technique and an extremely important issue:

1. The TechniqueRapid prototyping: HCD has moved this from a series of mini focus group discuss the product ideas on the basis of cards/a brief presentation to approaches that try to create the actual buying experience of the customer and iterate /build on these ideas as they observe customer and receive feedback. This is an important step forward and one which we have incorporated into the new Market Insights for Innovation & Design (MI4ID) approach now used by MicroSave.

2. The IssueUnderstanding the context and supply side: Initial HCD work in our sector paid inadequate attention to the supply side, or even in some cases the regulatory environment – clearly there are times when “optimal ignorance” needs to be calibrated. Although overlooking supply side or regulatory issues are more debilitating, perhaps my favourite example of this was when one excited HCD team delightedly announced that they had “discovered” Susus in Ghana and that these had profound implications for product design. A little less ignorance would have revealed that Susus are one the oldest financial systems in Africa, and were well documented from as early as 1957!

“Wouldn’t economics make a lot more sense if it were based on how people actually behave, instead of how they should behave?” ― Dan ArielyPredictably Irrational: The Hidden Forces That Shape Our Decisions

Behavioural Sciences have even more to offer, as the theory of the “rational economic man” has always been a stretch given the way we all really behave with money. MicroSave has started to look in detail at how the realities of human behaviour impact the design and delivery of savingscreditinsurance and remittance products. We have already applied some of these insights and ideas already including: how tweaking an account opening form triggers  usage or how modifications in financial capability approach spurs average deposits in banks and microfinance institutions.

The target customers for mass market digital financial services (DFS) and financial inclusion are not used to (making a decision or taking an action to) access formal service channels, and seldom use technology. Insights generated through the behavioural research approach can radically alter the way  DFS products and services are designed, delivered and marketed … and thus their uptake and use.

MicroSave has also used the MI4ID approach to: conduct research on household money management and decision-makingdesign of insurance products; find solutions for MFIs in India to tap savings, create financial education programmes for microfinance institutions, and assess agent behaviour in East African mobile money markets. The latter highlights how understanding customer/agent behaviour can help with management of the supply side. Indeed, almost all the supply side work we do at MicroSave, (process-mapping, product pricing, pilot-testing, strategic/product marketing, staff incentives etc.), necessarily involves research to understand customer/agent perceptions, aspriations, needs and behaviour. This is the core of any market-responsive approach.

These are exciting, and rapidly changing, times – my Father would have been delighted to see the renewed emphasis on putting the client at the centre of our business and moving towards what MicroSave has been calling a “market-led approach”.

“The more you engage with customers the clearer things become and the easier it is to determine what you should be doing”. – John Russell, President, Harley Davidson.

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Written by


Graham Wright

Group Managing Director