08 May Creating digital banks with a human touch
Retail banks continue to adjust to a postcrisis environment of patchy growth, changing regulatory demands, and margin pressures. At the same time, banks are confronting a digital and data revolution that is disrupting their industry. Digital innovation is shifting the behaviour and expectations of customers, who are increasingly eager for the convenient digital channels, interactive services, and transparent pricing that are being pioneered by leading global retailers. Meanwhile, technology has opened the door to new and innovative competitors.
For the smartest retail banks, the digital revolution also provides a path to operational and client excellence. Enhanced digital and IT capabilities now enable the leaders to automate processes, boost efficiency, and reduce costs, while also improving the customer experience and gaining market share.
Technology is, however, just part of the equation. The Boston Consulting Group’s most recent benchmarking shows that the top-quartile institutions are gaining advantage by blending digital innovation and technology with a human touch. Leading retail banks are becoming, in a word, “bionic.” That is, they are using digital functionality to meet client expectations for speedy and convenient service while providing thoughtful and caring human interaction to customers who need it. This allows them, increasingly, to deliver the right products and services to their target customers. These and other conclusions in this report have emerged from BCG’s fifth annual Retail-Banking Operational Excellence benchmarking, supplemented by our most recent client work.
The benchmarking data reveals significant benefits achieved by banks that focus on end-to-end digitization:
- As the top-quartile banks migrate their low-value transactions and interactions to digital channels, they are freeing up time previously spent on customer service and operations and reinvesting some of it in an increased share of client-facing full-time equivalents (FTEs) who advice customers.
- To further enhance the focus of their branch advisors, top-quartile banks are accelerating their use of direct channels faster than their competitors-not only for customer service but also for sales of simple products.
The process of building a bionic bank is different for every institution: each bank’s value proposition and strategy-as well as its starting position-are unique. The transformational roadmap for each, therefore, is distinct.
Get the complete report in PDF file here
