Industry
Banking
Banking Services Transformation: Unlocking Exponential Value
Solution
Cognitive Business Operations
Unlock Business Agility and Future-ready Operations with TCS
Highlights
- The banking, financial services, and insurance (BFSI) industry has been at the forefront of technology upgrades; however, delivering on overall experience is still a challenge for most firms.
- Experience-led transformation is hindered by a diverse stakeholder ecosystem and stringent regulations. Addressing these challenges through technology is not enough.
- We recommend a design-thinking approach underpinned by ExperienceOps to address these challenges. The approach enhances the overall experience of BFSI customers.
In this article
Abstract
Experience-led transformational programs in the banking, financial services, and insurance (BFSI) industry are multi-dimensional plays.
They involve diverse stakeholders in a complex regulatory environment. While there are existing key performance indicators (KPIs), processes, tools, and frameworks that achieve this, most of them are focused on assessing technology-led transformation. Given the highly competitive nature of the BFSI industry, there is a need to look at how businesses can successfully transform themselves from an overall experience standpoint.
We intend to measure all experience-related aspects objectively and provide a prescriptive approach to institutionalizing it into a systematic process regimen. The combination of empirical KPIs and process regimens will address the risks involved in a complex ecosystem of varied stakeholders’ needs.
Moving towards ExperienceOps
The BFSI industry is at the cusp of witnessing a significant shift towards experience-led transformation.
This change involves completely revamping how systems are used. While the industry has been doing well with technology-led upgrades, an overall experience-led transformation is still very challenging for most BFSI organizations.
An experience-led transformation refers to holistically looking at business outcomes from an experience standpoint brought about by underlying process, technology, and designs aspects. To illustrate, to measure the success of an agency system transformation, one would have to look at how it has improved the overall experience from the perspective of the agent, underwriter, call service representative, and the operations team. This is not possible today.
The BFSI industry faces two major challenges when companies try to embark on an experience-led transformation – an ecosystem of diverse stakeholders involved in any product launch and a highly regulated business domain.
In the former, many parties are involved in a product launch – agents, partners, customers, and marketing in the case of insurance, relationship managers, partners, customers, and investment agents in the case of banking and financial services.
The latter challenge above focuses more on the need to be compliant with varied regulations such as the American Disability Act (ADA), General Data Protection Regulation (GDPR), International Financial Reporting Standards (IFRS), and Markets in Financial Instruments Directive (MiFID) to name a few. Hence, there’s a need for an all-encompassing approach to tackle different regulatory requirements. The future, as we perceive, will involve a process regimen to measure these two challenges objectively and align them with budget, time, and environmental implications.
To successfully implement an experience-led transformation, we recommend a design-thinking paradigm. It provides a firm visibility into the perspectives of the stakeholders and users for whom it is intended. This leads us to three important questions:
- Can we enhance the overall experience of BFSI customers and the stakeholders invested in the transformation program?
- Can this experience-led approach be introduced into the project life cycle by adhering to all the relevant regulatory and compliance needs of the BFSI industry?
Is it practical to implement such a concept without compromising on existing techniques within an optimal budget?
Understanding the context deeper
In the insurance industry, agents rely heavily on paper-based correspondence, which is beset with delays in reaching the intended stakeholders.
Addressing this issue through technology only will not be enough to achieve the transformation experience needs of all the parties involved. At times, the agents’ interests may be overlooked. Also, the needs of the insurance carrier (increase in net written premium) and customer (increase in net promoter score or NPS) must be considered. Organizations must approach this such that they account for these needs holistically (see Figure 1).
Figure 1- An experience-led approach accounting for the needs of all stakeholders
However, there must be an empirical measure of various experience parameters combined with a process regimen that encompasses them. This goes beyond the traditional understanding of user experience. The solution in this case is two-fold:
- Bring an experience quotient into the mix of measuring techniques
- Introduce ExperienceOps as part of the regular project life cycle
A potential model
Typically, experience measurement is subjective and depends upon the stakeholder(s) involved.
To objectively measure overall experience, we present a potential model called ExperienceOps.
Experience quotient in measurement techniques
The first step is to quantitatively measure experiences. Such a quantitative assessment will pave the way for more tools, techniques, and automation. Measuring experience encompasses looking at the finished product or application from the perspectives of all stakeholders. Below is a series of nine quotients, which make up the overall experience quotient:
- Usability quotient: Addresses the ease-of-use of the product by all end-users and focuses mainly on the user segment concerned, such as geriatric and youth customer segments.
- Accessibility quotient: Ensures that the product is accessible to everyone, including differently abled users.
- Response quotient: Is available anywhere, any place for a reasonable duration.
- Assistance quotient: Helps users and stakeholders understand and seek assistance if necessary.
- Immersive quotient: Measures the overall satisfaction index from end-users and paves the way for newer ideas for an immersive experience.
- Security quotient: Measures how information is secured in the product or application.
- Usage quotient: Ensures ease of adoption and usage statistics.
- Compliance quotient: Ensures compliance with regulatory and organizational guidelines.
- Change quotient: Ensures that changes are introduced easily in the business process.
The needs of each quotient above varies across the banking, financial services, and insurance domains (see Table 1).
Figure 2 - The domain-specific quotients in the ExperienceOps model
ExperienceOps as part of a regular process
Based on the set of quotients, the next step is to establish a framework with tools, techniques, and defined processes to capture and update these quotients at various points in the product or application life cycle (see Figure 2).
Figure 3 - The ExperienceOps framework
To embed these quotients in an organization, there should be a cultural shift towards viewing them from an experience standpoint. This means changing an organization’s governance structure to ensure a smooth transition.
Looking ahead
The BFSI industry will soon look for and implement projects from a holistic experience-led approach.
This will become pivotal in differentiating products and services in the BFSI marketplace. ExperienceOps, with its diverse experience quotients, toolsets, and processes, provides a future-looking framework. Adopting ExperienceOps can go a long way in managing key BFSI experience facets – end customers, internal, or external financial intermediaries, and the ever-changing regulatory and compliance needs.
In summary
A cloud makeover for the debt collections space will bode well for all stakeholders.
The pandemic has proven to be an inflection point for collections, underscoring the need for a business-driven transformation approach. Success in the collections space will depend on banks’ ability to quickly adopt a robust cloud framework with the flexibility to seamlessly connect with legacy applications, a well-executed cloud roadmap, right skills and talent aligned with the risk strategy, risk analytics, and more. Banks that act with alacrity in moving to a cloud-based collections model stand to gain, especially given the possibility of rising defaults in the coming months.
