Commoditization eventually moves you away from customer experience- Are banks listening?

Ashok Kapoor

If you follow the trend of the last few years, customers have been moving towards a transactional relationship with banks. This is what banks wanted at some point of time—with online banking, ATMs and IVRs—to save on operational costs, while providing convenience to customers at the same time.

Mere convenience, however, is not the same thing as great customer experience. When banks pushed for technology with an inward operational efficiency focus, they pushed the customers away towards an “impersonal” engagement model.

Banks equated user experience with customer experience and put all their energy on improving the digital interface while overlooking holistic process aspects. Very few banks today provide a holistic process experience to customers. And they are in some ways, not surprisingly, leading the digital bandwagon as well among banks. However, such examples are few and far in between.

Banks have done a lot, but are plagued by rigidity and silos

The current banking processes are plagued with multiple challenges arising out of their siloed and rigid point solutions and systems.

Siloed Systems. The integration is built around data and atomic transactions, and not around customer-centric processes. So, in essence, while all the data is there and all transactions follow their own SLAs, the business processes still fail to deliver the holistic experience.

Rigid Workflows and Policies. Most workflows, if at all they are recognized as workflows, are buried within the point solutions that are geared towards doing their part right. This makes it very difficult to adapt to changing customer behavior and deliver end-to-end process experience.

Loose Customer Context. When customers initiate transactions through any of the available channel, the corresponding context and the transactional content doesn’t flow through the application integration points. The integrated systems become better at serving majority of repeating scenarios, and fail miserably at slightest of deviation from the normal scenario. This is what leads to banks being perceived as commoditized service.

Robotic and disempowered workforce. In the quest for scale and operational efficiencies, banks have driven standardization of processes, repeatability of transactional performance and in effect, "dumbing down" of human intelligence to routine tasks. What also doesn’t help is that human interactions are also measured in the same vein as systems— based on same standard SLAs of transaction times and throughput. Knowledge workers, when involved in resolving exceptions, are not provided the information nor motivation to be able to make intelligent decisions.

How can banks deliver Process Experience?

Let's use a clichéd example, which has a direct and ironic relevance to this. Coffee is a real commodity. Starbucks changed all that and built a brand that became an epitome of customer experience. It was a mildly sensational news byte that the same Starbucks is offering a digital wallet experience that could potentially threaten some banking services, but the bigger lesson lies in what they did as a whole. They converted a commodity- coffee, into a thriving experience-driven business. Banks went the other way round, in that they slowly converted their experience driven business into a commoditized service.

How can banks reverse the tide?

Let’s look at the pieces of the puzzle.

Omni-channel and cross-channel engagement. Banks today provide services over various channels. However, those are merely pretty interfaces for broken processes in the backend. What banks need to do is to build processes that translate well into the mobile and online interfaces. Also, a cross-channel engagement would mean that the process doesn’t break when customers change the mode of engagement from mobile to laptop to web portal to branch. However, for this to happen, process orchestration has to take priority.

Contextualization and orchestration. Banks need to look at their business services holistically and map them into customer centric processes. A mobile has to capture the context along with transactional request (say, an image or a transactional document copy, or geo-tagged location), and a process engine has to drive the request through people and systems with seamless integration and workflow automation. Also, one of the much overlooked aspect of process is the content integration along with workflow orchestration. In this digital world where media and content is used extensively by consumers, it’s important that banks enable customers to engage better through a content management system that is built into their process framework. In essence, banks need to elevate the process to customer level instead of looking at processes as a way to tie and integrate systems.

The real straight-through-processing (STP). There are a couple of aspects of automation. One is workflow automation that ensures that tasks are performed by the right resources in time with the required throughput. However, one of the elusive automation objectives for banks has been straight-through-processing. This requires integration of data and process as against point-to-point data integration between siloed systems. Also, banks have to find ways to isolate the repetitive and mundane tasks performed by people and translate them into business rules driven automation and robotic process automation (RPA) supported by a tight workflow. All this is not possible without a workflow engine, an integrated business rules management system (BRMS) and a seamless integration of workflows with core banking systems using service-oriented architecture (SOA).

Case Management. Banks need to realize that while workflow automates the structured processes well, they need an implementation of case-style process automation. This means that the processes are driven through an outcome-oriented workflow that is not rigidly structured beforehand. Knowledge workers are able to access the case folder with all the information needed for decision making and are able to reroute or create ad-hoc tasks to service the customer in the right context. This approach not only provides the right level of process experience, but also empowers the knowledge workers, making them feel less robotic and more as contributors to business.

Easier said than done?

While this may sound like the proverbial ‘easier said than done’, banks really need to look at ways to shift away from commoditizing services. Fortunately, there is a feasible way out. Banks don’t have to throw their existing investments away, but find a way to connect their resources better.

A process orchestration layer delivers that abstraction for banks to be able to connect their systems, processes, people and things. Process experience, after all, is not about pretty digital interfaces, but about carrying the context through processes and enabling people to deliver that experience. That is the only way for banks to adopt digital and reverse the tide in order to move from commoditized services to a customer-experience driven business.

The author is VP – Marketing, Newgen Software technologies Limited