Notes from BAI 2012 Retail Delivery
Last week we attended BAI Retail Delivery 2012. This year’s event offered a diverse agenda, and here are some of the themes and highlights we captured.
Mobile Banking continues to be hot topic as smart-phones move beyond a means for accessing balances and paying bills, to a commerce device for handling transactions and replacing credit and debit as a transactional payment instrument. Expanding the mobile channel in this manner will move the new front-line of banking from the desktop (via online banking) to the device. This will require additional due diligence by banks to identify and prevent fraud.
Personal Financial Management (PFM) is receiving a lot of attention. PFM solutions create a more educated and engaged customer. However, PFM adoption at banks has been relatively small. More banks are looking to offer PFM and those that already have a solution are looking to link PFM into daily life, extending it to the mobile devices, and making it actionable.
Social Media continues to receive a lot of attention, both as a platform for customer relationship management and support, as well as its potential as an integrated banking channel. Many banks already leverage social media as an important channel and are moving beyond simple communication to full customer engagement and an integrated, customer-facing channel.
A most interesting session on bank technology
One particularly interesting session was with the CIO of a top 20 bank. Regarding technology, his bank’s belief is that buy versus build is a pre-recession model. The new normal is that banks will buy the technology they need with an emphasis on outsourcing. As such, banks will need to apply more rigor when choosing partners and decisions will be based on transparency, character, and reputation as these decisions will be long-term partnerships. He gave this simple guideline to success for banks that are considering outsourcing:
- The customer experience has to be maintained – Brand must not be compromised
- Banks must maintain customer insights and analytics – While technology may be externalized the extent of outsourcing does not extend to knowledge management
- Solutions must provide the flexibility to manage risk consistent with the bank’s risk culture – One size does not fit all
Providers of choice must deliver solutions that meet the above requirements as well as help measure success for the various important stakeholders, including business line managers, operations, technology, and risk. As such, banks should not make decisions solely based on brand as they have in the past, but based on capabilities, goodness of fit and cultural alignment.
Banks that identify the best external partners will succeed in driving more value through effective outsourcing while reducing costs, improving operations, and increasing flexibility in responding to regulations and marketplace challenges.
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This post was contributed by: Brad Jones.
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