Financial institutions today are really struggling with balancing compliance costs, punitive measures from government regarding toxic assets (both financial and procedural), day-to-day operational expenses, competition eroding their market share, market disruptors, and R&D for innovation in an effort to thwart the expense of the aforementioned; simply stated, the intersection between supporting the going concern and transforming its channel strategies.
So where does today’s branch factor into this intersection? It has become a bit of a pawn and somewhat of a victim of the market conditions chronicled above. While expense ratios are dissected, and have become one of the main levelers for decision criteria, it has led to endless discussions regarding branch closure and expense reduction verses investment and innovation utilizing existing branch and human assets.
Many financial institutions are especially having difficulty making the pivot to engage the “new to banking,” “the under banked,” and “the millenniums” while catering to the traditional client, whether they are commercial or retail. Most banks (in fact, most companies) would also agree that next to their customers, their employees are their most valued asset. So the quandary becomes: How do you reduce your branch footprint and continue to expose or increase your client’s exposure to your most valued asset while identifying and capturing nascent market share?
Branch transformation
Over the last few years, there has been a lot of hype regarding “branch transformation” or “branch of the future.” Numerous investments have been made in technologies in search of a problem without walking a mile in the client’s shoes and asking the simple question, “how effortless is it to do business with my financial services ecosystem?”
Let’s also remember that complex financial transactions are rarely self-service events. While mobile and web applications have helped reduce transactional costs and transform the way many of us interact with our bank, branch transformation innovation seems to be focusing on point solution technology and not the maturation of the business process utilizing technology. In other words, solutions are being deployed from the technology out, not from the consumer in. Since the function of these solutions is to create an enhanced end user experience and new revenue opportunities, absent a fully integrated experience or the presence of unilateral technology solutions, there could be unintended consequences to your net promoter score (NPS) and those revenue targets. Independent digital and personal experiences without contextual awareness may result in additional frustration to the end user.
Integrated omni channel
Enter the integrated branch transformation and omni channel strategies. With maturity in the social, mobile, analytics, cloud (SMAC Stack), video, WIFI, location services and WebRTC technologies, a door has been opened to create an integrated seamless and portable physical or virtual interaction within the branch for complex transactions such as mortgage processing, retirement planning, opening various accounts such as brokerage and retirement, 529, IRAs, etc. For example, in lieu of an ATM with a video screen in a public place, why not create an internal/external virtual office environment with a dynamic staffing model that has a fully integrated and contextually- and linguistically-aware digital experience? Why not use a process that can be initiated by making an appointment on a mobile device or website that transitions to a bank employee in a physical branch or a virtual subject matter expert via WebRTC, making that end user experience and transaction effortless and more cost effective?
By doing this, your most valued asset — your branch and its associated staff — can now focus on a creating a high touch customer experience, positioning products and services that yield a more substantial relationship with your institution, and at the same time, make banking effortless for the customer.
So, before you invest in a number of technologies, projects, and milestones, put yourself in the customer’s shoes and ask: How effortless is it to do business with my financial services ecosystem?
