What does process transformation mean in the financial services industry?
Process transformation is the improvement of existing processes by redesign, ultimately eliminating unnecessary steps and introducing automation and new technology to increase efficiency, reduce costs and improve the overall customer experience.
Process transformation requires a complete look at the customer journey. Doing so provides benefits including an improved share of wallet, new customer relationships and customer retention.
Now is the time to challenge the status quo. Transforming processes to drive efficiency, lower overhead and retain and grow the customer base is of paramount importance for banks and financial services organizations. Competition, regulation, automation, digitalization, customer experience and analytics are driving innovation in the banking industry. And while it is important to drive innovation, we need to make sure that such enhancements reduce costs, retain and grow base customers, and improve the customer experience.
What are some of the most important processes that could be improved?
Some of the most impactful areas that are candidates for improved experience and efficiency include back-office processes and knowing your end consumers.
Banks and financial services organizations have a tremendous opportunity to improve back-office processes. Often ignored by internal IT teams, manual processes such as reviewing documents, investigating inquiries, performing account maintenance and handling receivables can often be an arduous process. And when manual processes are involved, banks are at risk of being in regulatory non-compliance and could experience costly errors due to rework that could have a negative impact on their customers and their brand. For these reasons it is important that banks automate manual processes through robotics process automation. Doing so improves processing time, reduces error rates and enables banks to better manage costs so that they can reinvest in their customers at a greater scale.
Another important area to be transformed is gaining intelligence on consumers. Now more than ever, it is important for banks to understand their customers at a deeper level through improved or supplemental data and analytics. While the term “big data” is an overused term in the marketplace and can be somewhat intimidating, it is important that banks be able to leverage data and analytics at a micro-level. Taking a deeper look at your customers’ behaviors as they interact with your bank at an omnichannel level through each step of the journey can easily be done with the analytics and information you already have on hand. By reviewing customer interactions, your organization can leverage critical data points to drive the improvements that will retain and grow your customer base by better supporting the end consumer, manage risks and expenses, and most importantly, improve brand equity for your organization.
Explain more about the benefits of process transformation to banking and financial services organizations, and how it can improve their performance.
There are many other ways that process transformation can benefit banking and financial services organizations and improve their overall performance.
First and foremost, maintaining a competitive set of offerings and good customer experience are critical in this ever-evolving era. On top of that, banks and financial services organizations must comply with evolving regulations and operate under severe budgetary constraints. Process transformation can help organizations more easily adopt service and technology updates required by new regulations.
Banks and financial service organizations can also benefit through increased accuracy that comes with automating tasks. Automation not only improves processing speed, but it increases the rate of accuracy of those vital tasks. And when speed and accuracy are improved, customers and regulators will appreciate that their bank is working for them in an efficient manner.
Additionally, banking and financial services organizations can also see cost savings from automation. By automating manual tasks, either planned or unplanned spikes in volume are easily addressed, thereby reducing the stress of staffing for seasonality. Leveraging robotics process automation enables companies to operate at high efficiency in order to more quickly service their customers at a reduced cost.
Finally, process transformation can drive a much improved customer experience. When organizations conduct a thorough review of processes, they will often uncover specific functions that will make things easier for their customers. In doing so, banks will often see improved profitability, accuracy and highly satisfied customers by making process transformation a priority for their organization.