Deloitte’s 2023 Banking and Capital Markets Outlook offers a unique analysis and insights into the banking industry. With numerous uncertain factors in the global economy, including inflationary pressures and the potential for slight recessions in certain economies worldwide, the year 2023 presents a fragile and uncertain landscape for the banking industry, among others.
In today’s customer-centric world, banking operations must prioritize providing customers with a seamless and personalized experience. Here are some key strategies that banks can adopt to achieve this goal.
Being obsessed with customers
Collecting and analyzing customer data through interviews and research and gaining a rich understanding of their behavior and needs, is the first step for the banking industry towards becoming obsessed with their customers and placing them at the forefront of their business. For example, obtaining information through data analytics, product testing, user and customer experiences, and ethnographic research would undoubtedly help in learning more about customers, providing them with personalized and unique experiences, and progressing towards a customer-centric transformation.
Customer data drives implementation strategies. For instance, when customers sign out of a product application, banks can leverage their extensive database to identify the reasons for this dropout, gain insights into customer behavior, and streamline the sign-up process for new products.
Handling competition with dexterity
Traditional banks face a threat from Fintech companies that offer a broad range of financial products and banking services. To deal with the competition, banks should look at new ways of handling operations, become more agile, focus on products that are customer driven, offer elevated customer experiences based on data, and provide solutions that work across all channels.
Pushing technology onto the back burner
In the current volatile situation and under pressure, banks may be tempted to postpone their technology budgets in order to gain control over the present and achieve short-term wins. Banks that fail to adapt to digital transformation will lose out to the competition and sacrifice innovation and revenue, particularly when the economy returns to normalcy.
Staying relevant and becoming future-ready
The 2020 Future of Jobs Report by the World Economic Forum states that 85 million jobs will become redundant by the middle of this decade. The banking industry will undergo significant changes in terms of skillsets. To be ready for the future, it should quickly adapt to narrow the gap between current and potential skills. This sector should focus on skills such as data science, digital engineering, and DevOps, which will remain relevant soon.
Elevating back-office experiences to the next level
Customer satisfaction depends on a holistic and complete experience of the banking industry’s front, middle, and back-office departments. Modernizing only the front-office experience creates an imbalance in the company’s offerings to its customers and increases inefficiency. Banks should empower every department of their firm to drive strategy and move towards digitization, including data management, cloud migration, and automation. This is crucial for the firm’s future and helps drive business success.
Finding answers to key questions
In their journey towards embracing customer-centricity, banks should ensure that failures are minimized. A significant investment is required for research, data, and personnel. Additionally, it is helpful to keep the following points in mind to ensure the successful delivery of a financial transformation:
- Do we have a chief customer officer? Can this person influence management to consider making transformative changes and strategies?
- Are we keeping up with the constantly changing customer expectations?
- Have we allocated a budget for driving customer initiatives?
In conclusion, the transformation towards becoming more customer-centric lies in the mindset. The key to success and future existence lies in placing the customer at the heart of this transformation. Creating a culture of ‘customer first’ and rewarding employees who have demonstrated this ability would be beneficial. By prioritizing customers, banks can build strong relationships and cultivate a loyal following, which will drive their success in the years to come.