The competitive forces driving the financial services industry have never been more palpable. Customers no longer just compare their banks to other banks. They now expect banks, insurers, and other financial services firms to compete with the consumer-grade digital experiences they’ve come to expect from other industries.
These expectations will be difficult to meet with the outdated and broken processes still at the core of many financial services firms. So how do you, a leader in financial services, ensure your firm can deliver an experience akin to that of Amazon, Netflix, or Spotify?
Forward-thinking leaders will critically consider the role of automation techniques to transform certain processes and ways of working. The automation toolsets and mechanisms available to financial services organizations today are improving processes, reshaping businesses, and delivering value faster than ever. Automation can enable a more productive hybrid workforce, optimize costs, and ultimately increase profitability while lowering regulatory risk.
However, the effectiveness of automation—measured in the degree to which employees are freed up to take on higher-level tasks, fragmented systems are connected, customer experiences are optimized, and cost savings are gained—requires an operating model that filters change through an empathetic, customer-centric lens. While regulatory practices and financial realities rule supreme, if it’s not additive to the customer value proposition in some way, firms should question whether to automate it.
To best prioritize your process improvement efforts and adopt the right automation for maximum value across your business, financial services leaders must start with a deep understanding of their customer, workforce, and operational environments. In this blog, we’ll explore each of these critical lenses to help you begin.
Customer: Aim for an ethos of empathy
As we saw during the pandemic, customer needs and expectations can change overnight. Financial services firms must be ready to respond to these new stresses efficiently and effectively. Having resilient and optimized processes will make or break your ability to do so.
Empathy mapping helps to optimize processes by determining where automation is critical to quality (CTQ) and where it’s not. By layering empathy mapping over the processes that most significantly impact your performance, financial service leaders gain an understanding of what matters most at each unique touchpoint in the customer journey.
If a customer needs a new debit card, for example, speed may be of the utmost value. In that case, consider which processes you can automate to meet your customer needs quickly and securely.
Now think about Estate Services provided by a bank to those who have recently lost a loved one. Every situation is unique and requires personalized guidance. Customers may seek more empathy, compassion, and flexibility in parts of the process with which they interact directly. Still, others can be automated to drive speed and efficiency. Consider when and where a personal, human touch is best leveraged to deliver a best-in-class customer experience.
While automation techniques can help you solve customer issues more quickly—either by chatting with a bot or by prompting an employee to take an action—the human element is still valued by today’s customers: A recent study by J.D. Power found that “overall customer satisfaction with retail banks tends to decline as customers transition away from the branch and to digital-only banking relationships. The overall satisfaction score among branch-dependent bank customers is 824 (on a 1,000-point scale), which is 23 points higher than the score among digital-only customers.”
The key is to identify the processes where people-centricity is CTQ, and where it’s not. Only with this information can leaders prioritize the right processes for automation, processes where lower human empathy is CTQ. It’s about avoiding the trap of automating for automation’s sake, which is particularly important to keep top of mind as you evaluate process improvements that have workforce implications.
Workforce: Improve processes to build a proactive and empowered workforce
Automation can open new worlds of opportunity for financial services employees by taking mundane, repeatable tasks and processes off of their plates, freeing them up to focus on higher-value activities that enhance the customer experience.
By automating the right processes, leaders can create business value and increase employee impact where it counts. For example, by upgrading your business capabilities to enable universal form intake and processing, employees can spend more time creating genuine connections with customers.
Remote working conditions of the last few years spotlighted outdated ways of working and system fragmentation, exposing where automation can best improve the flow of data between systems and enable employees to perform at higher levels. For example, a bot that assesses data in real-time can spot process anomalies and escalate variations to employees to drive better awareness, prompt action, and mitigate potential risks. For call center agents, automation can streamline communications, gather data, and direct actions with a more seamless customer experience.
By democratizing processes like e-signature capabilities and intelligent document processing, you can ensure that no matter where an employee sits in your business (or in the world, for that matter), firms can turn paper-based data into useable information that integrates with case management.
Additionally, process and task mining are important tools in optimizing ways of working, especially for a hybrid workforce. They allow you to assess what’s working—and what’s not—both at global and individual employee levels. Apply these insights in small ways, often, to develop processes that can be done well from anywhere.
In addition to creating a more impactful and productive workforce, automation can offer enhancements that financial services firms were not previously able to achieve. With natural language processing (NLP), a bot can sift through high volumes of data to make recommendations or prompt action. And while bots still have a long way to go in terms of delivering on the customer experience, they can play a powerful role in supporting regulatory compliance by monitoring risk and controls with a consistent and predictable outcome.
And while all of these tactical process redesigns are likely to deliver short-term efficiencies, ensure you’re evaluating their worth against their ability to be optimized enterprise-wide. Avoid band-aid fixes by selecting, designing, and testing all automation projects within a holistic vision for continuous process improvement.
Operational: Accelerate organizational agility with the right process improvements
Our June 2022 research revealed that 66 percent of financial services leaders believe it’s important to establish an operating model that enables change little and often, and 50 percent of leaders acknowledge that flexible operations (intrinsic to business agility) are critical for successful change and responsiveness to evolving customer and workforce needs.
While financial services organizations may understand that imperative, the path to achieving best-in-class operational efficiency—all while growing top-line revenue—is unclear for many.
Focusing on your processes—a core component of your operating model—can help. Clarity into your processes ensures you aren’t automating for automation’s sake. Processes sit at the intersection of your people, structures, governance, data, and technology. They are what power your operations day in and day out, and optimizing them is the key to building a flexible operation. To evaluate your operations with an eye toward process optimization, consider the following techniques:
- Employ service design blueprinting. To not only meet customer expectations, but to manage risk and compliance, financial services leaders must have an intimate understanding of how their back-end operations support the customer experience. A service design blueprinting effort creates that understanding and pinpoints opportunities where automation can limit risk and improve the customer experience. By strategically applying automated processes in the background, financial services organizations are agile at the core, prepared to respond to regulatory issues, customer needs, and technology shifts. Additionally, service design blueprinting will identify pain points that are ripe for automation.
- Establish a Transformation Value Office. Make managing change a core capability by establishing a Transformation Value Office. This becomes your automation center of excellence and source of the governance programs that maintain alignment and efficiencies in your automation initiatives. When our client, a large telecommunications company, sought to deploy and optimize a remote workforce, they turned to us to identify and deliver automation where it mattered most. We started with the establishment of a Transformation Value Office focused on opportunities that would improve efficiencies and customer experience while decreasing operating expenses. North Highland developed the office’s operating model, project lifecycle, and governance structures, then worked across the delivery lifecycle serving as process analysts, scrum masters, and program managers. These structures and roles were critical to identifying and delivering 92 automated processes that rapidly improved efficiency and delivered value across the entire business.
- Optimize process improvements enterprise-wide with a hypothesis-led approach. Process improvements should be driven by a holistic vision, focused testing, and collaborative design. Start with a precise and comprehensive understanding of customer, workforce, and operational needs. Then prioritize the change, test, learn, and deploy, all while making real-time adjustments along the way. It’s an agile approach to turning a large ship: Make small taps to the rudder in ways that continuously shift your processes in the right direction and in the right order of operations.
In the words of Mark Twain, “History doesn’t repeat itself, but it often rhymes.” Financial services organizations must find the tune that allows them to change quickly, often, and with empathy at the core. The right insights will spotlight the processes that will not only serve the customer and your workforce now, but enable a ready-to-change operational core for the future.