Jason Bettinger Oct 28, 2013

Innovation in the Omnichannel Model

Why are so many banks struggling to adapt quickly to the trends driving the need for massive transformation in their business? The pressures of dealing with increased competition, operating with limited budgets and the need to enhance capabilities in order to establish and maintain strong relationships with their customers are just a few contributing factors. In addition, historic banking infrastructure and applications have restricted agility and banks’ ability to change. The bar has also been raised with regards to consumers’ expectations. For banks to compete and successfully combat these challenges, they must innovate and quickly incorporate those innovations into every channel in which they operate.

Capabilities necessary to enable the omnichannel delivery model and the unified workspace will be essential. These capabilities shape where and how work is done, how resources are allocated and positioned, geographic expansion, how customer points of presence are designed and staffed and workplace configuration. These capabilities will offer new ways to engineer banks’ service delivery models that are critical to delivering the personalized customer experience now expected. It is clear that organizations that find ways to efficiently develop and implement the right capabilities will be the highly productive and cost-effective operations that thrive.

Changes Needed

For most banks to do so, however, will require a change in mindset, as well as changes to existing business and operational models that may have been anchored in a previous time, when many of the technical capabilities available today did not exist. Consider, for example, an executive team working to establish a delivery strategy in a market with both established and new competitors. Here are a few questions for them to ponder:

  • How should the team shape and structure the organization, operating model and sales and service delivery system so that the bank will successfully compete now and in the future with the established competition?
  • What should the bank offer in terms of products and services that would drive a superior, clearly differentiated customer experience to the point where more customers move their business to the bank?
  • What are factors that should influence and guide the bank’s organizational structure? Also, what technical capabilities would be essential now and in the future to win market share and enable cost-effective expansion and growth?
  • What choices should banks make in terms of allocating and locating critical knowledge experts to drive a differentiated level of service and simultaneously achieve high productivity and the requisite level of profitability?
  • What infrastructure and applications should be owned and operated within the organization, and which should be outside and managed by others?

Given the rapid changes to the technical and business environment, these decisions need to be made with a long-term view. They should result in new capabilities, technologies and services that configure the business and operating model to be more agile, cost-effective and with the capabilities to deliver more value to clients.

Innovation in the omnichannel model will need to be focused on maintaining customer satisfaction levels with each customer interaction. It will be driven by monitoring and analyzing continuous customer feedback and business results. A critical capability will be to enable technology that provides the right expertise at all points of interaction with customers at any time.

This can be achieved through an omnichannel platform for both customers and employees that supports video integration and a unified workspace. The ultimate goal is to make the full range of products, services, and expertise offered by an institution available to customers anywhere and at any time.

Innovation is a process, it will take place in phases and adjustments will need to be made along the way. A measurement methodology that includes success criteria allows the right adjustments to be made throughout the process. Without proper measurements in place, pilot times are extended, limiting banks’ abilities to make definitive decisions, extending the innovation process and preventing the bank from delivering to customer expectations and achieving high-levels of customer satisfaction.

Enabling all of the aforementioned capabilities will increase the speed and agility of bank operations, create higher levels of customer satisfaction, enable significant leverage of resources and assets and facilitate rapid/cost-effective growth. The good news is that the capabilities required to make this all possible exist and are available today. The keystone will be how organizations can leverage their innovation process to incorporate these capabilities into their omnichannel business model, applications, and infrastructure.

We may someday have systems and applications that could largely automate our ability to deliver new innovation and the perfect customer experience, especially across channels. But banks can’t afford to wait for that day. They need to delight customers during every interaction today and demonstrate innovation that counters the lingering perceptions of banks as being slow-moving, impersonal corporations.

Mr. Bettinger is industry lead - banking, Americas Customer Value Acceleration, with San Jose, Calif. -based Cisco Systems Inc. He can be reached at jbetting@cisco.com.

 

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