There are a number of key processes and strategies financial institutions need to get right if they want to turn the dream of genuine omni-channel banking into a reality.
In this white paper, I introduce the Omni-Channel Wheel of Fortune, a representation of the six key areas where – based on my past experience with NCR’s retail banking customers – I believe banks should be focusing their efforts in order to make a holistic transition to omni-channel.
In this blog, I’ll explore in detail two key elements of business optimization that are crucial to get right: distribution channel strategy and organizational culture.
Drive your channel strategy using operating principles
When it comes to devising your distribution channel strategy, it’s beneficial to start from the position of understanding your current performance and setting key goals and performance indicators to gauge future progress.
Of course, any strategic planning will need to take budget and financial forecasts into account, but the ideal situation is for senior management and leaders to work together to align strategic challenges and opportunities with financial considerations.
Having clear operating principles in place will help to provide the structure and direction that your business needs to complete a challenge as big as delivering a seamless omni-channel experience for customers. As well as offering a sense of clarity and consistency to improve day-to-day decision-making, defined operating principles can serve as a form of control to ensure that any significant changes are aligned with the strategy as a whole.
Operating principles for a business-wide drive towards omni-channel service could include developing a common sales and service capability with consistent processes across all channels, and designing channel configuration to reflect the needs and behaviors of customers.
In order for omni-channel service delivery to be a success, it’s imperative that all functions and teams within your business are fully aware of and committed to the operating principles. Each category or set of principles should have a sponsor and a formal governance process to ensure standards are upheld.
When it comes to measuring the success of changes in strategy, conclusions should be based on customer outcomes. Never forget that the customer is of paramount importance and their needs and expectations should be the driving force behind your omni-channel transformation.
“Focus your energy on the key choices that influence revenue decision makers – that is, customers.” [Harvard Business Review – The Big Lie of Strategic Planning]
Having the right culture to achieve your goals
It’s vital for any financial institution to have clear goals, defined processes and a well-defined strategy to support its transition to omni-channel service, but it’s practically impossible to turn those plans into reality without the right organizational culture.
Managers and leaders must engage with employees to develop a strong understanding of how people feel, how efficiently they work together and what motivates them to work hard for the business and its customers.
A strong, positive culture and healthy employee engagement are two of the key foundations upon which your omni-channel transformation will be based. These concepts also contribute to the quality of your products and the ability of your organization to respond to challenges and adversity.
“Strong employee engagement promotes a variety of outcomes that are good for employees and customers. For instance, highly engaged organizations have double the rate of success of lower engaged organizations.” [Harvard Business Review – Employee Engagement Does More than Boost Productivity]
Management guru Daniel Pink has identified ‘mastery, autonomy and purpose’ as the key drivers of employee engagement and satisfaction, while author and motivational speaker Simon Sinek believes it is crucial for people to understand the ‘why’ in everything they do.
According to a national study by Dale Carnegie Training, 29 percent of employees in the US are ‘fully engaged’ in their work, but 26 percent feel disengaged. This means nearly three-quarters of all workers are not as engaged and productive as they could be. Furthermore, the Bureau of National Affairs has estimated that US businesses lose $11 billion a year because of employee turnover.
Preparing for a digital future
The future will be defined by digitization. That means banks will need an agile, digitally driven culture with the flexibility to respond to new challenges.
Having a clear strategy in place must be one of the key focus areas, along with breaking down functional silos, reducing command and control structures, and clearly communicating the ‘why’ of your business. By embedding a ‘test and learn’ philosophy into the culture of your business, you will empower employees to take risks and innovate, to the benefit of your customers.
This will require some significant changes, most notably to management framework, information management systems and decision making. There will also have to be a rigorous feedback loop linking front office to back office and operations, along with a real-time performance management system based on internal and external feedback.
These are big changes, but the time and investment will help to ensure your bank has the right culture, technologies and practices in place to make omni-channel a reality.