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The “New Normal” in Banking Customer Expectations

How process automation is modernizing banking and improving CX

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  • Written by  Burley Kawasaki, Chief Product Officer at K2
The “New Normal” in Banking Customer Expectations

For the last few years, there has been an incredible elevation in customer expectations around digital banking. Customers expect more from their banks – they want to be able to access their bank accounts or access banking services from anywhere and at any time. The explosion in new digital banking experiences delivers a whole new level of convenience to consumers, who now increasingly bank primarily through mobile, web, chat and other digital channels.

The COVID-19 pandemic has taken this to a whole new level – being unable to visit your bank’s branch was the final step in the tidal wave towards accelerating digital banking. Suddenly even those consumers who had been “laggards” in using digital banking services were forced into using them and finding them increasingly convenient and easier to use. Even when consumers can return to banking at their branch, they will be less likely to do so at prior levels. Recent studies (like this one from Deloitte) validate that the use of digital banking is likely to stay even once the crisis has passed.

The large “Money Center” banks were prepared for this and have been investing for years. It’s been well publicized on the significant digital investments being made by the large banks (such as JPMorgan Chase employing 30,000 software developers). However, the regional banks and credit unions are generally much less prepared for this and have far fewer resources to allocate towards digital banking. For them it’s become a significant “do or die” type moment to not just compete but even survive this shift.

The Opportunity: Embracing Transformative Automation

The good news is that you don’t need 30,000 developers to build these types of digital solutions from scratch. The emergence of easy to use, digital process automation tools now enables banks of all sizes to be able to accelerate their use and adoption of digital processes that transform their customer experience. This also allows banks to quickly adapt to the new reality of their workforce in majority working from home. When many of your employees cannot physically access physical (or digital) documents in a branch office or centralized location this requires the embracing of new digital approaches to collaboration on the authoring, editing and processing of documents. This allows regional banks and credit unions to adapt to change – not as a one-time response to the pandemic, but to prepare them to continue to transform and innovate to keep up with the pace of competition.

Now that interest rates are so low, for example, intelligent case management solutions with digital process automation can help handle high volumes of customer requests for home loans and refinancing.

Digital process automation and case management have streamlined a wide variety of back office processes that once bogged down bank workers. By shifting much of these tedious, manual tasks from human to machine, banks have been able to significantly reduce the burden on their employees, which has had a direct impact on everything from performance and efficiency levels to staffing issues and customer experience.

One area where process automation can instantly help, for example, is with loans and refinancing. These business areas have recently seen increased demand due to low interest rates. According to a Mortgage Bankers Association  survey on U.S. retail residential mortgage applications, refinancing activity rose sharply in the first full week of July. Requests for refinances made up 64% of total mortgage applications. At the same time, the Refinance Index, which covers all mortgage applications to refinance an existing mortgage, escalated by 107% year-on-year.

Combining case management and digital process automation can help banks manage immediate pressures, as well as power entirely new workforce management strategies. These could include more flexible working practices or redirecting skills away from manual work toward higher-value activities.

Generating value from automation

The agility of intelligent case management and digital process automation solutions enables companies to build digital capacity fast. These tools plug easily into core banking and loan origination systems, without obstructing core business. In other words: banks can innovate without mission-critical processes grinding to a halt.

In this technology environment, teams can build digital process management solutions that link various legacy systems and data repositories together. With everything connected, automated workflows can be created to orchestrate work between people and other resources (software robots, for instance). This accelerates customer service and core operations, brings down expenses, and creates more time for strategy and innovation.

Other benefits include being able to standardize and streamline banking processes, centralize data, digitize forms, enable automated document exchange, and allocate resources intelligently to free capacity across the business.

Putting automation to work

When teams rely on automation and digital forms rather than manual approaches and cumbersome spreadsheets to manage work, this saves time and reduces risk. Rather than inefficient swivel-chair processing, employees can collect information and initiate requests from one central user interface.

Outlined below are a few use cases for intelligent case management and digital process automation in finance and banking.

  • Intelligent Document Processing
    Documents and statements still form a large part of any bank’s operations, from signing up for new banking services, applying for a loan or obtaining more advanced wealth management or advisory services.While many of the simple and highly used form have been digitized there are still many that depend on manually prepared documents. Documents being attached to emails, unstructured document management, and documents being created using archaic manual practices which introduces errors of omission and errors of inclusion that can lead to big compliances and risk issues.
  • Increase responsiveness
    Workflow automation supports seamless customer onboarding and reduces servicing times. Routine customer queries and requests can be managed digitally through online and mobile self-service, while more complex cases can be quickly routed to the relevant teams for swift resolution. All this helps to improve client relationships and retention.
  • Reduce compliance costs
    As regulatory reporting requirements increase in volume and complexity—automation streamlines data management and report generation for increased speed and accuracy. Also, when every process step is logged in the technology framework, it’s easy to audit processes for inconsistencies and demonstrate compliance.

Watch out for these stumbling blocks

Implemented strategically, process automation and intelligent case management can deliver productivity, cost savings, and improvement in customer experiences. However, some banks get stuck just outside the starting gates, and battle to scale the benefits of these technologies.

One of the key sticking points is managing handoffs between humans and digital solutions. This is where process automation platforms that can orchestrate work between employees, software robots and other digital resources comes in extremely useful.

Ideally, case management solutions should also be able to accommodate emerging technologies, as these become viable. With the flexibility to blend more cognitive capabilities into the automation framework, as and when these are needed, banks can keep developing ground-breaking processes.

It’s therefore imperative to think long-term and view automation as a journey rather than a once-off project. With this mind-set, it doesn’t make sense to invest in point solutions that focus on solving one problem quickly. Rather, with technology that supports both rapid automation and offers scalability, it’s possible to meet transformation goals on many levels, across the enterprise.

To truly capitalize on an investment in intelligent case management and process automation, banks should create clear digitization roadmaps and establish a team to manage this process. This will drive success in the long term and ensure all transformation opportunities are explored and realized.

About the author:
Burley Kawasaki is a software industry veteran with over 25 years of experience working in leading high-technology and cloud-based companies. As Chief Product Officer, Burley leads K2’s global product management and software engineering organization and is responsible for K2’s product innovation, design, and development.

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