Globally, 2018 was a turning point in impelling business transformation (especially banking industry) into more strategically focused, technologically advanced, and operationally effective institutions, so that they may have remain dominant in a rapidly evolving ecosystem. However, the implementations of those transformations were and still are far from easy as most banks grapple with multiple challenges such as complex and diverging regulations, legacy systems, disruptive models and technologies, new competitors, and finally, an often-restive customer base with ever-higher expectations.
Let us focus on one of the key challenges: Customer. Basically, customers are not demanding as we imagine them to be. The ever-higher expectation of customers is the product of rapid development of today’s technology. With the current modern age advancing, it’s only natural to follow the trend: the best customer experience, that is from the perspective of customers. It is not supposed to be called demanding, as the current industries have the power to fulfill them. This long-term mindset of customer centricity is the guaranteed success when it comes to customer loyalty and retention.
Banking industry has undoubtedly improved in many ways in the last couple of decades. But most organizations have not gone through the customer-centric transformation that other industries have. With widespread digital disruption, banks may even risk losing control over customer experience. Various banks, global and local, large and small, have changed their market and customer strategies since the financial crisis. Many of these decisions may have been forced upon them by regulatory expectations, and perhaps not balanced with a refined understanding of markets and customers. Fortunately, most banks seem to have realized that a growing fintech ecosystem, once perceived as a threat, can actually be an advantage for helping them serve their customers, both through emulation and collaboration. With customer-centricity features in fintechs, it is possible to meet, and arguably even exceed customer expectations.
Nonetheless, the main objective for most banks is to achieve organizational agility, and to do so they have to consider adopting innovations, managing talents differently, and pursuing key partnerships within a broader ecosystem to manufacture and deliver solutions for customers. In the end, banks have to contend not only with running the bank, but also transforming the bank to grow in a sustainable manner. Banks will likely have no choice but to balance these goals against the urgencies these days and eventually will achieve ample rewards.