Addressing Technological Uncertainty in the Banking Industry

A recent article in the Harvard Business Review analyzes where certain vertical industries sit in an uncertain world, using scales of demand and technology.

It’s interesting to see banking and insurance companies face technological uncertainty, which can be attributed to the adoption of big data and other analytics technology and what (if any) effect those uncertainties will have in driving revenue.

New technologies and new competitors are hitting the markets at an unprecedented rate. Having the ability to manage the uncertainty generated by these disruptions is the key to enabling success.

While uncertainty is certainly increasing, it isn’t affecting all industries the same way and the Harvard Business Review article highlights this issue well, with some thought-provoking questions:

  • Are new technologies or startups threatening my company or my industry?
  • Over the past five years, have new competitors entered the market and captured 10 percent share by targeting our customers with a different value proposition than what we offer?
  • Over the past five years, have we begun to see customer preferences change, resulting in a different mix of products and services being demanded?
  • Have you recently started offering (or are planning to offer) a product or service that has never been offered before?

I encourage you to answer these questions and take a look at the “grid” and decide for yourself – do you fit where you expected to?

Related Articles:

Branch Banking vs. Mobile Banking: Is It Really An Either-Or Decision?

In a recent article, Dave Martin, EVP at Financial Supermarkets, talked about the future of branches as a differentiator for banks. He believes that branches will undergo a transformation from a place where customers go to conduct transactions, to a place of relationship-building and human interface.

The next day, Ron Shevlin, Senior Analyst at Aite Group, penned a response, arguing that bank branches are not the differentiator, and that mobile/digital technology allows banking employees to connect to consumers, negating the need for physical branches in the future.

This got me thinking about my personal banking experiences with branches, as well as mobile/digital channels:

  • Branches were originally built to facilitate transactions (the teller) and relationships (the banker) with customers. Today, self-service and automated systems can support many transaction types without the need for a branch.
  • However, when you go to the branch in the morning, you will see many small business transactions–such as deposits and cash withdrawals in different denominations–that do require teller interaction and help build relationships with the local branch personnel.
  • When it comes to community banking, a branch gives a physical anchor for the brand and representation for local charities and social activities.
  • Ron is correct in that the interaction between bank employees and customers—which we at Avaya refer to as customer engagement–can be delivered effectively through mobile and video technology.
  • Perhaps the answer lies in not having to choose between the physical branch and mobile/digital channels, but the convergence of both. In the retail industry, consumers have come to expect an omnichannel shopping experience, with seamless interactions across physical stores, Web, social, the phone, etc. For banks, perhaps the solution is going to be the same, ultimately requiring them to be “on” with all channels, from branches, ATMS, phone, email, Web, social media etc., on all devices in order to differentiate.

To learn more about Avaya’s Solutions for Banking please visit our website or click here for customer case studies.

Is Big Data in the Financial Sector Just a Numbers Game?

Banking has historically been a very data-oriented industry, but there has recently been a significant push toward implementing “big data” strategies to refine processes and better understand customers.

I was fortunate enough to attend a recent IDC webinar that talked about this very topic, with a particular focus on how banks can adopt big data analytics and how this newfound surplus of information can be used in innovative ways.

Omni-channel interaction, hyper-personalization, and single-customer view are among the areas where data and analytics are enabling innovation.

“In-market adoption of big data and analytics has reached the point where the capabilities and applications these technologies enable are becoming mainstream for a growing number of financial services firms,” said Michael Versace, Global Research Director at IDC Financial Insights.

Big data analytics can help banking executives deal with a variety of business issues such as customer engagement, risk management, productivity, and shareholder profitability. This can provide banks a potential competitive advantage, which–let’s face it–is always well received in such a tough market.

Without doubt, mobility and big data are leading the technology needs in banking. When it comes to technology enablers, we tend to make a beeline to the CTO office.

In addressing some of the business imperatives mentioned above, and specifically relating to big data, we need to look beyond the world of IT executives. Why? Because data impacts beyond IT, and line of businesses in this sector are incredibly varied, very influential and need to be considered in bids.

With a coordinated technology lens we can help support global banks and enable them to “know their customer better.” Who wouldn’t want that?

If you are an IDC customer, watch the replay of the webcast here.

Click here to learn more about Avaya’s banking solutions.

[Case Study] How Landmark Bank Uses Avaya to Provide Personalized Customer Experiences

Imagine your local teller–let’s call her Sandy–at your commercial bank of choice. Sandy knows who you are, greets you by name and provides a high level of service tailored to your needs. Many smaller banks operate this way, and is one of the reasons they are successful and retain clients.

Now imagine that your bank implements an automated response system to centralize customer service requests, and instead of being connected to Sandy directly, you are routed to a contact center.

What if instead of listening to a long list of options (“Press One for English” or “Oprima el 5 para Español,” etc.), the contact center technology uses your caller ID and information from your last call to elect to call Sandy directly? This will soon be reality at Landmark Bank.

Brenda Emerson, CIO at Landmark Bank, recently faced the age-old problem of growing commercial banks – providing expanded service in a cost-effective way without losing the hometown bank feel.

With Avaya Aura® Experience Portal, Landmark Bank will have the ability to use smart routing, so that after one initial call, a person can elect to be routed directly to their preferred teller when calling the central customer service number. While the back end operations will have changed, the front end customer experience remains constant.

“We have the scale, size and expertise to still have a great community feel, yet bring technology to our markets,” Emerson says. “We think that those two things together give us a competitive advantage.”

In addition to the capability for smart routing, Landmark Bank has eliminated geographic boundaries with Avaya Scopia technology. Scopia video conferencing is now used by customers looking for specialist consulting within their local branch.

For example, you come into your local Landmark Bank branch looking to discuss mortgage options but the regional expert is located in another office. Using Scopia, Landmark Bank can queue up a high-definition video call with a mortgage specialist on-site in real-time.

“With Scopia, somebody said to me, it’s almost like they’re in person,” Emerson said. “It never felt that way with our old video system. Even if someone needs to call in, it sounds like they’re in the room with you.”

To learn more about how Landmark Bank has succeeded with Avaya, click here.