American Express Financial Advisors: Improving Design Quality And Reducing Cycle Time

Introduction:

Whereas Intel has a cultural propensity for change, American Express Fi­nancial Advisors (AEFA) is in the final stages of a project so sweeping that its goal has been to create a new company that could put the old one out of business—before a competitor tries to do just that. Financial planning is a relationship-oriented activity in which people trust the achievement of their financial goals to an AEFA advisor and the company that supports that advisor.

Financial planning:

• Financial planning is a relationship-oriented activity in which people trust the achievement of their financial goals to an AEFA advisor and the company that supports that advisor.
• AEFA knew as early as 1986 that it needed to focus on this relationship to succeed. it got serious about it in 1990.
• By then, the company had made several sincere efforts to improve its client relationships, but none had taken root, and although it was good by industry standards, it was not as good as it wanted to be.
• Senior management decided that the only way to break through the barriers to change was to redesign the entire system, and the best way to drive the change was through a new cross-functional team created solely for this purpose.

The 31-person team focused on four objectives:

1. Retain 95 percent of clients.
2. Retain 80 percent of financial planners who had four years of service and 97 percent of veteran financial planners.
3. Achieve annual revenue growth of 18 percent.
4. Bolster the company's position as industry leader.

The team spent about a year interviewing clients, advisors, management, and staff to find out more about the existing system. They bench-marked companies such as Motorola, Microsoft, and Wal-Mart to find out how other firms handled similar processes. When their research was completed, they developed a list of process- and system-oriented recommendations, most of which have been implemented.

• The technology also gives the advisor the flexibility to tailor a financial plan presentation to the client's preferred way of receiving informa­tion.
• By pressing a key, the advisor can choose to present information using numbers or pie charts and graphs, to use longer or shorter explanations, to add information in an appendix, or to employ other options that make it easier for clients to understand their financial plans.
• AEFA expects to have the technology fully implemented in 1998.

AEFA:

• AEFA also redesigned its processes and products to improve service to its clients and advisors. Client service processing is an example.
• AEFA used to have a different service area for nearly every type of product it sold.
• If clients or planners had questions, they might be passed to several departments before they got one that could help.
• To improve service, the company looked at this process from the client's perspective, then created service teams that could answer ali product service questions from clients and planners in one call.
• It also organized its coordinating teams around a specific geographic region so that each team's operating hours match the region it serves.