During a recent conversation with colleagues from the Financial Services sector, one person challenged: “Is there really anything new and innovative for banking technology, or have we already seen it all?” The lively discussion led to a far more interesting and important question:
“Where are banks finding the inspiration and tools to drive customer-focused innovation?”
Here are my thoughts on Financial Service Industry (FSI) innovation and how bankers are increasingly taking cues from consumer tech and smart retailers as they practice the art of banking. I see opportunity for bankers to capitalize on changing consumer views of risk and what constitutes a good customer experience.
What's New in Bank Technology?
I’m hearing a lot lately about exciting new technologies driving innovation in banking. There are conferences dedicated to the topic, analyst reports and whitepapers being published, webinar series and more. If you Google “technology innovation in the financial services industry,” you get more than 200 million results.
A sampling of intriguing hits includes mobile technology that reportedly can save the banking industry US$ 1.5 billion annually, Digital Shadows footprint based cyber-attack protection technology, Virtual Piggy that can support gaming and other social micro-transactions, and my favorites (because they both include awesome dogs) are Simple.com with a cool and intuitive way to save and pay and FloatMoney that helps build interest free credit by shopping (okay, the shopping part is good too).
I could go on and on with this list, but as readers of my CMSWire article series know, I really do prefer to start with the customer motivation and let the technology discussion drive from there. While it’s important to consider new external technology forces impacting a market, I like to think first about the desired customer impact, not the technology. So what are banker customer concerns that present opportunities for technology response these days? Here’s my take on what a banker “bucket list” might include:
- Deal with the loss of customer confidence that came with economic market upheaval
- Capture and retain clients who have changing attitudes and expectations for online and omni-channel communication
- Satisfy customers who come armed with their own new technology like mobile, BYOD and social apps
Read on for some artful approaches banks are taking to "check off" the list.
Banks are reimagining how to create and sustain customer relationships
In order to drive customer-focused innovation, banks are reimagining how to create effective customer relationships in today’s environment. For the mega banks, and the banks who inherited customer accounts from them during the market turmoil, dealing with customer confidence means restoring positive experiences.
These experiences in the past were often represented by personal relationships and interactions with key bank branch personnel. Now, innovative technology, much of it inspired by consumer and retail examples, can be used to achieve these objectives.
For example, case management technology is a perfect approach to preserve the personal service that attracted many bank customers in the first place and at the same time bring down cost to serve. What was perhaps once performed by a representative with a personal relationship with the customer can now be assisted with case management apps that bridge channel, information and process gaps.
With this assist applied to account opening and customer onboarding, it becomes possible to “know your customer” not only for compliance but also to intelligently suggest appropriately targeted product options, much like consumer retailers do. This also reduces the transaction costs involved and saves the lost opportunity cost.
Case management also enables knowledge workers to innovate, that is, to perform work in their own unique ways to best respond to managing error exceptions as well as unusual circumstances. This is one of the distinctive elements of this technology — the concept that the process participants are at times involved in defining specific actions for a case and at other times involved in responding to actions taken in a case.
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