With financial institutions of all sizes undergoing digital transformation, a vast array of new technologies are being designed to cut costs, increase convenience and deepen customer relationships. As they roll out new technologies, however, many FIs are realizing the challenge of getting customers to change their ways.
A top-down digital culture is necessary to drive transformation at a financial institution. It’s not enough for executives to just support digital transformation – they need to be its driving force. A recent report on digital banking found that more than a third of leading digital transformation FIs had their CEOs leading the charge. If the leadership is not on board, there’s little chance the rest of the organization will buy in.
To build a digital culture, one of the most important investments to make is in training. Without a deep understanding of your new technologies, your people won’t be comfortable recommending or supporting them. It sounds easy enough, but generally speaking, employees don’t love training. So you need to find ways to make that training engaging and useful.
You also need your executives to signal to the organization that they want your people to take some time out of their days to get familiar with your new tech. Too often we hear about FIs who want to transform, but are under pressure to limit employees” training time. Do you want to transform or not? If yes, then something’s gotta give.
Quick hits don’t work – you need to think long-term
Many organizations have taken an event-based approach to building a digital culture. Some have launched expensive marketing campaigns to drive customer awareness, while others have held training events for employees. While both approaches have merit, they fall short of achieving the transformation goal because they’re short-term campaigns.
Using technology to transform how customers do business with you requires more than fire-drill training and awareness campaigns. It requires employee training tools that drive distributed practice, and support tools that allow both employees and customers to try out your new tech in a risk-free environment. Rather than having an event-based focus, you should find ways to deliver ongoing, bite-size training sessions that establish learning as a habit.
And it’s not just your employees that need to be trained on your new tech -- customers need training, too. Before even considering your digital channels, customers need to understand how the new tech will benefit them. Does it save them time or money? Is it easy to use?
Some FIs have tried to educate customers with expensive marketing campaigns. While marketing plays a role in educating customers, you’ve got to be strategic in the types of campaigns you deploy. For example, some large FIs run national television commercials to educate customers. With all due respect, that makes no sense. What percentage of a national audience are your customers? Even if you’re Bank of America, it’s less than 20%. So 80% of your spend is wasted on educating people who couldn’t care less about your tech. And of the 20% that are your customers, how many of them actually watch TV ads these days?
Front-line staff may be your best asset
Hyper-targeted tactics are a better way to reach your customers. The question isn’t “How can I reach my customers?”, it’s, “How can I reach my customers who aren’t using my digital channels?” Customers who don’t use your digital channels are the folks who visit your branches or dial into your call center. So the best way to educate them is through your front-line staff. If your organization has developed a digital culture, your staff will be able to promote your new tech by spotting natural opportunities to explain how it’ll improve a given customer’s life.
Imagine a landlord comes into one of your branches to deposit her rent checks. Wouldn’t it be great if the teller had the knowledge and confidence to say, “Mrs. Jones, did you go know you could’ve saved yourself a trip, and the wait in line, by using our mobile check deposit?” Even better, imagine if the employee had a support tool to demonstrate right then and there how easy mobile deposit is. That’s how you motivate people to change. But there’s no way employees are going to recommend digital solutions unless they thoroughly understand the value proposition and how to use the tech.
Digital transformation is here and you need to nail it in order to cut costs and protect your market share. But it’s not as simple as building great new tech. That’s just the beginning of the transformation journey. New tech is not worth much if your customers don’t use it, and your customers won’t use it if your people don’t understand it. And your people won’t understand it unless you’ve built a digital culture in which your whole organization’s on board. And getting that done takes practice.
John Findlay is CEO of Launchfire & LemonadeLXP, a digital marketing and training firm based in Ottawa, Canada.
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