By Dave Jones,VP of Product Marketing at Content Services Platforms supplier Nuxeo
How can traditional financial institutions stay relevant as big-tech companies flood the market with a new wave of financial customer service innovations? Nuxeo’s Dave Jones proposes four digital strategies for survival.
As open banking continues to disrupt the financial services industry, financial technology innovators – from small fintech startups to the internet giants – are increasingly making their presence felt. Which means that traditional financial institutions can no longer rest on their laurels if they want to stay relevant to existing and prospective customers. Gartner asserts that, within a little over a decade, 80 per cent of established players will go out of business or suffer other ill effects as more attractive alternatives enter the market.
Customers are hungry for change, too. Frustrating service experiences are stoking their appetite for something new, and a provider’s digital prowess is often the primary appeal.
So why haven’t traditional banks upped their game? Digital transformation is hardly new to the FinServ agenda, yet to date, the established players have largely failed to deliver anything significantly different and exciting.
At a very practical level, major institutions are not set up to be agile. Even today, over three-quarters (76 per cent) of organisations simply can’t find the information they need to deliver digital service innovation, according to recent research by Nuxeo. Nearly the same proportion (75 per cent) want to extract the required data from “locked” legacy systems; and 79 per cent can’t connect different data sources to support more dynamic services.
By contrast, alternative financial service providers, particularly the big-tech brands, are less encumbered by traditional information systems – for instance enterprise content management (ECM) solutions, which have failed to evolve with modern priorities.
4 actionable digital strategies
As 2019 gets going, there are four practical steps banks might take to safeguard their future:
- Accept but move on from legacy constraints
Rather than think in terms of costly rip-and-replace programmes, or complex systems integration projects, there is a way to move forward while still exploiting legacy investments.
One very practical option is to deploy a cloud-optimised content services platform alongside existing core business and IT systems. It means departmental or function-specific systems can stay as they are for now, but the organisation can tap into their contents in support of additional and new use cases. These could include faster credit approvals, a more consistent experience across different customer touchpoints, or new product development.
One of the immediate problems this approach addresses is the complexity of managing different types of data and content (video content, audio files, images, etc). ECM grew out of document management, yet most businesses today are not managed according to document-centric processes.
The flexibility needed to be more customer-centric relies on being able to efficiently and easily unlock information contained within documents, and combine it with other data to build a more complete picture, allowing fast decisions and next actions to happen – aided by intelligent automation, where possible. This in turn could help reduce application approval times, for example.
The fact that content services platforms have been designed from the outset to be run on a cloud-based infrastructure means they are inherently flexible, scalable and futureproof too. They can potentially support any future customer service proposition banks may roll out.
- Achieve a clear line of sight across content silos
Even if information is stored in diverse systems, being able to see and access it all via one central hub will make it easier to manage everything from security, data protection compliance and customer permissions management, to new service innovation. The more complete the insight, the easier it will be for responsible teams to identify new product opportunities and/or maintain compliance.
- Innovate incrementally and at a faster pace
Once banks are free to do more with information they already have, they can start to press ahead with specific service improvements for customers. That could be something as simple as giving customers real-time insight into their overall financial status, across multiple financial products and reflecting up-to-the-minute payment activity.
- Delivering benefits today, while preparing for the future
After being limited for so long by locked-down data and finite system capacity, it’s important that banks build scalability and future-proofing into their strategies for information management. Avoid being too prescriptive about IT systems at this stage, and instead keep your options open by leveraging a platform that has the adaptability and scalability to support future growth..
The author is VP of Product Marketing at Content Services Platforms supplier Nuxeo [www.nuxeo.com/?utm_source=PR&utm_medium=UK]
A detailed ebook exploring practical ways forward in financial services, 5 Digital Strategies to Overcome the BigTech Threat in Financial Services, is available to download on Nuxeo’s web site
COMPETING IN A DIGITAL WORLD – SMES FIND THEIR FEET
– Stefano, Product Manager
Digital transformation is different for small and medium-sized companies. Or is it? In this article, we take a look at the current state of digital in SMEs and look ahead to see what is in store.
“Changes in business operations, and in the way customers are served, driven by digital technologies.”
That is a compact definition of digital transformation. And the digital technologies in question? They range from IoT (internet of things, or connected devices like smart sensors), to Robotic Process Automation and AI, to cloud computing.
SME rate of digitisation
Whether your business employs ten people or 10,000, the ingredients for digital transformation are the same. So how are small and medium-sized companies faring? Are they even interested in digitisation? Research1 says they are, and UK SMEs are doing better than many of their European counterparts, with high scores for adoption rates of cloud computing, Big Data and AI. To put this statement into perspective, 58% of companies have adopted cloud computing, but only 27% use some sort of AI-based technology.
Still, only 40% of SMEs report that digitisation is a top priority. An important fact, as the European SME survey 20191 shows a correlation between prioritising digitisation and investment. Those companies that say getting digital is a top priority invest more than companies that give digitisation a lower priority. The companies that prioritise digital also expected to export more than companies who see digitisation as less critical.
Naturally, as SMEs are a very heterogeneous group, there are differences in the area of digitisation as well. Some sectors are further along than others. Roughly speaking, finance & accounting firms, manufacturing companies, and the logistics sector are a step or two ahead of firms in the construction business and the legal profession2.
The big gain
So, what is it that drives digital transformation? What do SMEs stand to gain?
The short answer is a competitive edge, or even just remaining competitive (enough). Digital transformation is not an option; it is a must. The 24/7 economy demands fast service and quick supplies, and that goes for B2B markets just as much as for B2C. Digitisation enables companies to satisfy such demands.
The predictive capability of AI can reduce downtimes, for example – it will know in advance when machinery is likely to break down and can schedule preventive maintenance accordingly. Another example is increased productivity through the use of RPA or software robots. With RPA, a company can automate routine jobs like checking invoices relatively quickly and cheaply, freeing up human capital for other tasks.
The digital future
To look ahead, we also need to take a look at some constraints SMEs face with regards to digital transformation. The main issues UK firms face in this respect are around cybersecurity and the lack of skilled workers. In other countries around Europe, insufficient IT infrastructures also ranks high on the list of concerns.
Dealing with cybersecurity risks and especially ransomware attacks, is a significant worry for companies, as they are costly, difficult to prevent and have the potential to damage their reputation. Financial constraints are also a leading problem firms face when trying to skill up. Salaries for highly skilled IT talent have risen to a level that is prohibitive for many. At the same time, it is also hard for SMEs to attract and retain people, as candidates consider them as less attractive in terms of opportunities for growth.
According to Hays2, most employers say the lack of skills of existing staff prevents them from taking full advantage of the opportunities digital technologies provide. They are turning to solutions to train their employees and outsourcing work.
Nonetheless, digital transformation also provides plenty of opportunities. Look at fintech. Not what you were expecting, perhaps, but the rise of fintech has undoubtedly been advantageous for SMEs. Where SMEs have traditionally been caught in the middle between large corporations and consumers, as far as banking services were concerned, fintech is now providing smaller companies with choices that were not available before. A survey by EY3 shows that, in the UK, 18% of SMEs have adopted fintech services. These services include banking, payments and financing.
SMEs have taken essential steps, but they have some way to go as well. What lies ahead seemed brighter in January 2020 than it is now, just a few months later. Still valid for any company setting out on the digital transformation path, though, is that investing in people – skills, communication and culture – is crucial. Although the survey done by Hays found that many employees feel that ‘going digital’ is not a bad thing, the human factor does seem to be a stumbling block for many SME’s. One possible solution is for organisations to cooperate in creating training programmes and offer employees a challenging, cross-company career path.
1 KFW Going digital – the challenges facing European SMEs | European SME survey 2019
2 Hayes What workers want
3 EY Fintech is a world of choice for small and medium-sized enterprises
AI: CUSTOMER FACING EMPLOYEES’ BEST FRIEND IN THE FINANCIAL SERVICES INDUSTRY
By Ryan Lester, Senior Director, Customer Experience Technologies at LogMeIn
We’ve all heard the old saying “money talks.” Well when it comes to customer loyalty and retention, good customer experience talks much louder, with 30% of customers leaving a brand and never returning due to a bad experience.
The truth is, there are a lot of companies with similar products and services, but that doesn’t mean that differentiation is impossible. So, what’s the solution? For financial services, large and small, customer experience is becoming the key competitive differentiator and the best way to deliver an impactful experience is to empower customer-facing employees to do their best work. Artificial intelligence (AI) is enabling these employees to create remarkably better customer experiences, resulting in customer loyalty, advocacy, and overall growth.
For financial institutions that have been considering new strategies for improving the quality and efficiency of their customer experience, here are a few ways AI can enable them to deliver the “human factor” that good customer experience demands whilst ensuring customer facing employees can provide a more positive experience for customers.
Increase employee productivity
How much of employees’ time is spent searching for answers to questions? Do they ever have to put customers on hold or even step away to get additional help? AI helps provide front-line employees real-time guidance so they can spend less time looking for information and more time solving problems. An AI-powered chatbot, for example, can be listening in the background of a conversation helping point employees to the right data, solutions, and processes to resolve customer issues faster than ever before.
Deliver a consistent customer experience
When banking customers engage with their financial institutions, they measure the speed and accuracy of the service through two criteria. First, how quickly can the system access their account and deliver the correct information? Is it faster than a human could type it in and share it? And second, if they eventually do need to be connected to a live customer support agent, is their information captured and passed along accurately? AI technology takes those general queries off the customer support team’s plate, providing a quick, accurate, and effective response. If a query needs a more in-depth response, AI can hand it off to support staff to address.
Not only this but leveraging a centralised, AI-powered knowledge solution ensures every employee has access to the same, updated information, so no matter who the customer speaks to, they can be assured that employee responses are both consistent and accurate across the board.
Accelerating employee training and onboarding
Like any industry, employee turnover is inevitable and can be costly. But, not training new employees correctly or in a timely manner could be much more costly. When it comes to financial services there is a lot to learn, whether it is something simple like the process for checking an account balance to all the nuances associated with mortgage loans. AI can support on-the-job training by helping new employees answer questions confidently, correctly, and much quicker than they could before.
Improving employee satisfaction
Today’s banking customer has all kinds of new ideas about their banking experience. “The Amazon Effect” has successfully raised consumer expectations to the extent that a consistent, personal, and relevant experience is the new normal. As a customer, how many times have you been told “I’m sorry, I don’t know the answer?” Customers want solutions to their problems and employees want to be able to deliver those solutions as efficiently and effectively as possible. AI assisting in the background helps minimise those negative moments – making employees job easier, less stressful, and overall more enjoyable.
Identify knowledge gaps
Do you know all the questions employees are getting asked? Do you know what’s easily answered and what’s not? Real-time insights allow knowledge managers to keep up to date on frequently asked questions and gaps in current resources. This allows them to strategically improve or add content where needed.
Augmenting customer service
Whether talking with an AI chatbot or a personable customer service team member, the modern banking customer has high expectations for convenience, speed, and security. Which means that the technology you choose to deploy and how you deploy it is now just as important as who you hire and how you train them.
Today’s AI solutions won’t replace customer service agents or get in the way of the human factors that drive the customer experience. On the contrary, they augment it, allowing the business to do more without adding human resources. The higher the quality of a AI chatbot solution, the better it will be at taking the routine requests off the plate of customer service agents—giving them more time to provide a personalized and positive experience for customers.
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