How to get ready for digital transformation in financial services

Brendan Mc Aravey, Country Manager at Citrix South Africa

Brendan Mc Aravey, Country Manager at Citrix South Africa
Brendan Mc Aravey, Country Manager at Citrix South Africa

What is digital transformation? Simply put, it’s leveraging digital business, which Gartner defines to be the creation of new business designs by blurring the digital and physical worlds, to reach goals that could not be reached earlier, faster, or cheaper, otherwise.

It is a journey that started with the rise of the Internet and web interface technologies in the late 90s to early 2000s, revolutionizing the way financial services companies conducted communication, transactions and outreach. That being said, these new digital business strategies weren’t necessarily connected or integrated to existing channels, or aligned to the way customers behave. They tended to be an after thought or a side project, much like installing new office carpeting or designing employee appreciation events.

Even when digital technologies were utilized, other manual processes still prevailed. Take this example from days gone by: A customer submitted an online application for an insurance policy. The agent manually printed it out for processing. The agent then sent a stack of papers back for the customer to sign. Upon receipt of the signed paperwork, the agent processed the newly signed papers and then converted them back to digital copies for archiving. Processes were designed to work around – not to integrate with – digital technologies.

Today, however, the journey of digital business is starting to crest, fueled by technology and cultural trends. For the retail banking industry, it’s also a choice – do you ride the digital business wave or do you turn back to the shore?

The rise of the next generation of digital business in banking and insurance is in part driven by technology trends such as device proliferation, hosted applications and platforms, 24/7 Internet connection, and the maturing of big data and cloud; and in part by cultural trends such as the increased expectations of customers and workers. Not only are they comfortable with digital technologies – they expect to use them in their everyday life, including financial maintenance.

For instance, according to a CEB report commissioned by Citrix, Moving at the Speed of Byte: Ushering the Era of the Digitally Enabled Financial Institution, customer preference for completing insurance transactions through digital channels has gone up from 28 percent in 2010, to 41 percent in 2015. Banking customers increasingly prefer digital methods that allow for quicker ways to check balances or pay bills, with a 10 percent increase for mobile, and almost 20 percent decrease in ATM transactions from 2013 to 2015. Customers expect constant availability and security of digital technologies. It makes things easier due to flexibility and mobility, as less time is required to complete transactions and workflow, with no travel necessary. At the same time, these same customers have not given up on the traditional channels. From 2013 to 2015, there was little to no change in the number of banking customers who used in-person services (33 percent) and call centers (19 – 20 percent) at least once per month.

Since calling it quits is not an option, the question is: how can financial marketing professionals succeed in riding the wave of digital transformation? The key is not to operate digital channels as individual channels, but to embed digitization throughout the business by integrating digital technologies and automation into existing channels, workflows and process. The goal is to provide a more personalized, timely customer experience.

After successful digital transformation the following scenarios become a reality for customers:
A banking customer’s online application form now goes straight to processing agents who can immediately open the account using the same digital platform.
Customers can sign documents immediately using digital signatures and file sharing, and be notified of progress in a timely manner. Or, if they prefer to meet the agent in person at a local coffee shop to complete the paperwork, the agent can still offer such digital workflows via a tablet as long as there’s network connection.
Using their mobile apps, insurance customers can immediately file claims in the case of an accident, or the agent can go onsite to kick start the claims process. They can take photos of the damaged car and send them via a mobile app.
Customers can be notified instantly when their agents have processed their claim via a common digital platform.
All that being said, financial institutions that want to capitalize on digital transformation should consider the following principles when designing a customer experience.

Ensure people (customers or employees) are at the center of digital channels. Eliminate complexity and streamline user-facing processes where everything works intuitively and consistently.
Provide the network, apps and data for people to work and to complete transactions wherever they are, via any device of choice. And the apps must be secure, with high availability and performance.
Make sure people’s interactions with digital channels result in a great experience, such as moving seamlessly across a diverse mix of devices and locations throughout the day securely. Design security protocols so that they are not cumbersome and do not impeded on the user’s satisfaction.

The digital transformation of financial services organizations is a critical next step for the industry, especially in today’s hyper competitive marketplace that serves ultra information-savvy consumers. But with the right approach and focus, banks and insurance companies can be more agile and responsive, resulting in higher customer satisfaction that translates to tangible business benefits.


By Brendan Mc Aravey