What is Salesforce Financial Services Cloud?

This blog is not intended to cover all the capabilities of Financial Services Cloud (FSC) since there is plenty of information available on this topic out there and you can dive into its features on the Salesforce Industries page.

In this blog we will look at some of the current challenges in the financial services industry, Salesforce’s FSC and what it can bring, and how you can get started in your transformation journey, utilising frameworks such as V2MOM and TOGAF, to plan ahead.

What is Financial Services Cloud (FSC)?

Back in 2015 Salesforce announced it was launching its Financial Services Cloud (FSC), a Salesforce integrated Lightning only extension built on top of Sales Cloud and Service Cloud, designed to drive stronger client relationships and innovation with financial services in mind. Consider it an accelerator for the financial services industry. Its strength lies in an out-of-the-box financial services oriented data model that extends the Salesforce platform to fit the needs of financial institutions. It’s also bundled with features, such as the Action Relationship Centre or the Rollup by Lookup, that extend the platform for relationship modelling, workflows and roll-ups, allowing anyone (with the right access permissions) to see a household’s or client’s financial status at their fingertips, and streamline the employee and customer experience. 

The changing, and challenging, landscape of the financial services industry

In this new era of customer connectivity and personalised experiences, financial services providers face several challenges that require them to take risks and make changes. Some of the most prominent challenges, such as regulatory compliance, require financial institutions to invest in transforming traditional operations, explore new solutions and innovate. Is the FSC the answer to some of these challenges

The answer is yes. FSC primarily works within the customer relationship management, case management, workflows, document management and intelligence. And although it’s not a ‘one-size-fits-all’ solution, it can be tailored using custom and out-of-the-box extensions and integrations, to optimise many critical operations.

Regulatory Compliance

The financial crisis of 2008 resulted in several regulatory changes for the financial services industry. Financial institutions have to meet regulatory compliance standards in the country they are based in, or the countries they do business in. Protecting sensitive customer information, recording, archiving, protecting and classifying data, reporting suspicious activities, running Know Your Customer (KYC) checks, and even how to deal and share financial information (if you live in the UK, you might have heard about Open Banking) are key to addressing these compliance standards. Furthermore, in July 2022 the Financial Conduct Authority (FCA) shared its plans to bring in a new Consumer Duty, which will set higher and clearer standards of consumer protection across financial services. This will require institutions to put their customers’ needs first by improving customer service and, more importantly, improve interactions with customers, through timely and clear information so that consumers can make good financial decisions.

By standardising how a financial services organisation stores and structures data, and controls compliant data sharing, disclosure consents and who has access to deals (all core features of FSC), it’s easier to allow data exchanges between financial institutions and ensure compliance, therefore avoiding fines and loss of reputation. In addition, institutions can track interactions, bring the lending process online to increase transparency and self-service, and define the next actions to ensure customers have a repeatable and consistent experience.

Customer Loyalty and the transfer of wealth

Over the next few decades, the largest and most affluent generations will transfer their wealth to younger generations. Retaining and attracting customer loyalty must address the fact that customers are looking for tech-savvy financial advisors and businesses that can provide them with personalised, convenient, fast, accurate and consistent experiences.

With FSC, institutions can reduce implementation costs and development work with prebuilt, domain-specific features and innovation. This can enable an increased collaboration across teams, bring processes completely online (where those new generations prefer to be in) and deliver personalised customer experiences, at the right moment. Features such as the household relationship map, and the actionable relationship centre (ARC), are really powerful tools to help your business know your customers and identify opportunities within, for example, the younger generation that could be your future customers.

The rise of the tech-savvy disruptors – the Fintechs

Speaking of innovation. Traditional service providers are also competing with industry disruptors. In fact, according to the Millennial Disruption Index by Scratch, “Seventy-three percent of millennials say they would be more excited about a new offering in financial services from Google, Amazon, Apple, PayPal, or Square than from their own bank”.

By reducing implementation costs and using pre-built, best practices and features designed for their industry, financial services providers can spend less time tackling the technology challenge, and more time designing experiences. Features such as out-of-the-box automations to streamline common processes, rollups to summarise information at household level, communities to let your customers submit their information online, and extensions from Salesforce that allow you to connect to Salesforce Pardot (for targeted Marketing) or even Mobile integration, there is a lot to innovate with.

Lastly, those pesky legacy systems and isolated data

Businesses must address the issue with isolated data and outdated systems that have built up over several years and sometimes, decades. This prevents providers from innovating, accessing accurate customer information and sometimes even making it difficult to meet regulatory standards. As we wrote in our previous article on 7 Salesforce Data Cleansing Best Practices, “your software is only as good as the data you put into it.”.

With FSC, financial services institutions can drive innovation by integrating data and systems, organising all the information in one place. This way everyone has a consistent, single view of your processes, customers and data, eliminating the need to toggle between multiple systems.

Where should I start on my transformation journey in financial services?

Now that we understand some of the benefits of FSC, let’s explore how to get started with a transformation in this challenging space. 

  1. Start by defining the vision and goals. Your business might want to look into the Salesforce V2MOM to create a strategic company alignment, the current challenges (regulatory, data, competition, etc.) and future innovations.
  2. After the vision and motivation, set the strategy and align IT goals with the business goals. We suggest adopting a well known IT enterprise  software development framework, such as The Open Group Architecture Framework (TOGAF), as a guide. This will help implement software technology in a structured and organised way, with a focus on governance and meeting business objectives. 
  3. Define your Business, Information Systems, Security and Technology Architecture before you dive into Opportunities and Solutions. Don’t forget to plan for integrations with transactional systems, external data sources, and any other platforms that your business relies on. 
  4. Evaluate opportunities and solutions. Once your business knows what they are after, and there is an early view of your requirements, review the out-of-the-box capabilities of FSC and other similar products, and compare them to your needs. Evaluate modifications to features that are required to support your business processes, estimate the size of your user base, the data, security and regulatory needs, and determine your licensing requirements. 
  5. Evaluate complex extensions and potential need to include other solutions and vendors. Beyond pre-configured settings or features, evaluate whether there is a need for advanced customizations or any add-ons to make it work for your organisation. This could impact your costs and timelines.
  6. Capture the risks and the downfalls, and ensure you are meeting your principles. Determine if any limits or feature limitations affect your implementation, migration or future state of your solution. If the business, data, technology or architecture principles are not defined, this is a good time to write them (here are a few examples from the TOGAF guide).
  7. Define your project and prepare for delivery. Either if your business decides to implement using waterfall or agile, greenfield or brownfield, build in house or be supported by industry experts, plan before you change. Don’t forget to evaluate your internal skills, change management, governance and training! This is also a good time to think about the delivery in terms of resources and costs. 

Use the steps above to plan and reflect on what your business wants to achieve, evaluate if the Salesforce FSC is the best product for you, and if it can help on your transformation journey and drive a faster time to market. And of course we can help you throughout this process so any investment decision is well substantiated and delivers the promised results.

Next on our FSC series, we’ll have a deeper look on how FSC can enable different verticals within the Financial Services space, starting with Wealth Management and Insurance.

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