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Digital transformation in a post-pandemic environment

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Most banks are falling behind other industries when it comes to digital experiences. Today, I can simply pull out my smartphone and push a button to have someone drive me around in a car. The payment process is seamless and invisible when I get out the car. This is the customer experience that financial institutions need to compete with.

Last summer, I gave a talk at the American Institute of Physics Conference on how financial institutions can support the transition to digital channels in a post pandemic world. I reiterate my belief that it is impossible to not to at this time. Customers are changing, competition is raising the bar with new services. Traditional financial products no longer suffice.

Banks are known for making short-term decisions that can lead to missed opportunities for consistent tech investment. Banks budget on an annual cycle, make decisions based upon old ROI models, and prioritize based on what will bring in the most return over the next year. Conway’s Law states that banks should be a good example of Conway’s Law. This law says that technology should reflect the organization’s structure and communication style. It is not unusual to see silos within financial institutions, leading to duplication across silos. Financial institutions are organized in silos, which makes it more difficult and costly to make changes. Financial institutions must move beyond a product-centric approach and adopt a customer-centric perspective throughout their organization. To sustain the shift towards a digital culture that can use Artificial Intelligence (AI), it is essential to increase the pace of change.

AI can reimagine the customer experience

Customer propositions can no longer be static and one-size-fits-all–they should be intelligent, tailored, and go beyond banking to address customer needs that may involve both banking and non-banking products and services. Financial institutions that use AI and analytics to provide these types of intelligent servicing propositions will be able increase customer satisfaction, loyalty, and ultimately generate more revenue.

This is possible for financial institutions by addressing these three areas:

1) Data shared across the company

An enterprise-wide, real-time data infrastructure that collects all data points relevant to a customer’s relationship with each division of the company. This provides a single view of the customer and includes all channels, journeys, and products.

2) Data consolidation on a single platform

Banks using AI to combine data from multiple sources within their organization into a single customer data platform is necessary for these enterprise data sets can be effectively leveraged across teams.

3) Appropriate data governance

Intelligent, personalized interactions with customers can only be achieved by ensuring that the correct data is available to enable decision-making, in the right format and at the right time, according to various AI models.

Design, data science, and product management are all necessary to create customer experiences in digital and AI era. Financial institutions aren’t used to the types of data, analytics, and AI skills needed to create these new customer experiences and propositions. Financial institutions face a constant battle for talent. This requires a detailed plan to recruit and retain the best people. The strategy should include a description of the capabilities that can and should be developed by banks to gain competitive advantage, and partnerships with technology partners.

It is all about people. AI has the potential to revolutionize customer experience. This vision cannot be realized without the right product and tech talent. It also requires agile working methods and the human ability to manage partnerships.

The post Digital shift in a post-pandemic environment was first published on Stuart Cook.