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Backbase coffee break: discussing how digital strategy helps in uncertain times

The current ‘normal’ is causing unique challenges for business leaders across the globe.

“My colleague Tim Rutten and I recently hosted a webinar with Jürgen Pulm, CEO of RBS Services Switzerland, and Jeff Sinnott, EVP of Vantage Bank Texas to explore how leading banking executives are adapting to the new normal and to hear their biggest lessons and insights.”

Finding a Rhythm 

First and foremost, banks need to address how to keep staff safe and support the internal shift to working from home. Within days’ people have had to very quickly adjust to the new situation, and banks have an immediate responsibility to think about the safety, morale and anxiety of their staff. Fortunately, the overwhelming majority of services can be provided remotely so most people can continue their work as usual.

But there have been some clear lessons.

Employers must be flexible in allowing staff to reorganise their lives and ensure they provide staff with the tools to work from home. The initial internal communications are vital and banks must properly communicate the decisions and changes they make with a clear rationale. Approach this situation with humanity – every employee will be experiencing different scenarios. Understand them. From child-care to communal living, it’s a tricky environment to navigate. Use surveys and buddy groups as a way of getting a pulse-check on morale. Don’t forget that work is often a social experience, so it can be beneficial to try to encourage the social element of work back into the life of employees by providing new extracurricular activities.

By being flexible and supporting staff to adapt, banks can keep morale high, staff productive and, once through the crisis, they will be part of a wiser, more resilient organisation.

Keeping customers happy

Looking externally, understanding the clients’ and their circumstances is paramount. In this climate, banks must ensure they can maintain strong relationships with their customers and communication channels are key for this. Now more than ever, customers need easy-access to their banks to address their questions or concerns. Many customers will be keen to make sure they have access to their cash and savings, so it’s imperative to make them understand that you are there for them and your services are still accessible.

They have put their trust in you, now more than ever it’s time to prove you’ve earned it.

There are still obstacles with some scenarios requiring an in-person meeting, such as cash exchanges or accessing safety deposit boxes. But as long as communication channels are kept open, clients will generally be understanding.

This environment is particularly challenging for private banks, whose in-person relationships with their clients are paramount. The onus is on the bank to maintain service levels. Be as responsive as possible via the necessary touchpoints with services like call-back functions, web chats and videoconferencing.

In all cases, the customer must feel valued. Maintaining a positive relationship and smooth customer experience should be front of mind.

The digital leap forward

Although keeping personal services and relationships are a top priority, this can be maintained through digital means, and clients who may have been previously reluctant are learning those capabilities. With branches closed, almost all interactions have moved to digital channels, and as a result, there has been a notable influx of clients asking for digital access, many for the first time. Even though a small proportion have not yet engaged digitally, most are seeing the benefits.

This significant boost in demand for technology may shift the overall business models of banks.  There will be drastic changes in business patterns, such as big upticks in digital enrolments and loan applications. Banks can manage these inclines by shifting internal resources and adjusting workflows to better suit new demand.

Fundamentally, the accelerated transition to digital service will see the customer experience improve. Therefore, by default, the banking landscape is likely to change for the better as the crisis drives the transition to digital services to the next level. Suddenly, those who have already undergone a digital transformation find themselves in an advantageous position.

Operational optimisation

Adding to this, the rise of automated processes will drastically benefit the efficiency of business. As they work through this crisis, everything is being tracked real-time via digital for the first time. Moving away from manual paper processes in this way is an important step in making the organisation more modern. This also creates a huge pool of data for behavioural analysis. Every customer is now operating online and, by understanding their behaviours, banks can better assess the needs of their customers and quickly react to them.

Similarly, banks must empower employees to be as agile and productive working from home as they would be in the office. Teams should be strengthened with access to technology such as RPA and Java capabilities to help them look for pain points. In this regard, banks can learn a lot from fintechs. Fintechs manage to be agile despite being beholden to the same rules as the rest of the market. Although large banks have more complexity, the mindset of fintechs seems to be the key. Their innovative approach and the confidence they have to rise to future challenges is the core component  of their success.

Having said this, there is a need to balance compliance responsibilities with moving fast and adapting quickly. It has demonstrated the value of having an agile mindset as banks need to adjust very quickly — but still maintain key controls and all the audit trails and approvals, for which providing more empowerment in a decentralized fashion is a solution.

Closing note

For banks, this is the time to step up and show their value. It’s a defining moment that will determine the future of their business and, despite the current challenges, there are opportunities in the digital sphere. Organisations of all sizes and functions must balance their immediate response to the crisis with the long-term vision of modernising.

Businesses are strongest when they have a collective perspective, and finding ways to engage with your teams and your partners is going to be essential now. By digitally empowering both the talent within the organisation and the customers outside of it, banks can use this new normal to thrive.