Below are key highlights from the original Banking Transformed podcast.
According to the Digital Banking Report, digital transformation is the top priority of most of the world’s financial institutions. But where should they start, and what roadblocks will they face? In a recent episode of the Banking Transformed podcast, Financial Brand co-publisher Jim Marous discussed these and other questions with Ravi Vakacherla, Chief Transformation Officer at People’s United Bank (a Horizn client).
At People’s United Bank, digital transformation is everywhere. “From the chairman and CEO, the president, my boss, the chief administrative officer, to the rest of the bank, transformation is necessary and important for us,” says Ravi Vakacherla, People’s Chief Transformation Officer.
“When somebody says, ‘Hey, the customer needs an answer,’ they’re looking for an answer now, not five days from now.”
Having joined People’s as a programmer 15 years ago, Vakacherla brings a wealth of experience to his new role — a mix of IT knowledge, business savvy and a deep understanding of the customer experience. His eclectic background gives him a unique perspective on emerging technologies and the customer needs they address. “When somebody says, ‘Hey, the customer needs an answer,’ they’re looking for an answer now, not five days from now,” he says.
People’s new Business Transformation Office has individual teams dedicated to automation, optimization, research and partnerships with Fintech companies like Horizn. They all report to Vakacherla. It’s an approach to transformation governance that is agile and responsive.
One of the biggest tasks the new office has faced came in response to the pandemic, with People’s transitioning its 6,400 employees to remote work. “We had to work very closely with our technology team,” Vakacherla says. “And the first discovery was that technology was only one part of it. It wasn’t enough to just set them up.”
In a recent article, The Financial Brand’s Jim Marous describes “the importance of including employees in the digital transformation journey,” something Vakacherla embraces. People’s Business Transformation Office, he says, is guided by six objectives:
“In order, I would say the six objectives at People’s United Bank for the Business Transformation Office are: Our first one, improve employee experience. Two, enhance customer experience.” (People’s partnered with Horizn to produce a series of Digital Demos that take both customers and staff through the bank’s digital tools step-by-step.)
He continues: “The third objective is to help the bank grow revenue. Four, improve our operational efficiencies. Five, optimize and automate our processes. (By the way, in that order — you optimize before you automate.) And the sixth one is offering better products and services to our customers.”
“In the end, it is the employees that are the conduit between this technical product/service and the customer. So the employee experience was a very important part for us.”
From People’s standpoint, the employee experience is vital. “You can talk all about customer experience and buy the next fancy tool,” Vakacherla says, but it’s the employee who is ultimately “the face” of the bank to the customer and must understand these tools in order to deploy them. “In the end, it is the employees that are the conduit between this technical product/service and the customer,” he says. “The employee experience is a very important part for us.”
“If you are not able to better understand the customer and better serve their needs, there is no use to having all those technologies.”
The point, Vakacherla says, is not technology for its own sake, but to develop and deploy tools that help customers and employees in the real world. “We are not a technology company trying to prove the fanciest technologies and whether we can integrate all of them,” he says. The central question should always be, ‘How does it help?’ “If you are not able to better understand the customer and better serve their needs, there is no use having all those technologies.”
As Jim Marous explains, “including the employees also allows them to feel like they’re not going to be displaced by the automation, robotics, and everything we’re doing in the back end, and that digital’s not a bad thing.” Demystifying technology for the people on the front line, he says, makes it more effective.
Vakarechla agrees. It’s the difference, he says, between digital account opening and mere “digital application collection.
“Think like a customer and not a banker.”
“When we did our online account opening,” Vakacherla says, “we insisted on end-to-end process automation.” A rule of thumb: think like a customer, not a banker. “One of the important things is making sure all your employees are easily able to learn and understand the products and services we are offering,” he says. “How can you support a customer about a product that you yourself have not used or don’t know anything about?”
To help its customers and employees understand these new digital tools, People’s partnered with Horizn to produce a series of Digital Demos that walk them through these technologies step-by-step. “Engagement was amazing,” Vakacherla says.
“We want to fit our products and services into the customer’s life journey and not ask them to take a detour.”
A rule of thumb that Vakacherla follows is to think like a customer, not a banker. “One of the important things is making sure all your employees are easily able to learn and understand the products and services we are offering,” he says. “How can you support a customer about a product that you yourself have not used or don’t know anything about?”
“We have digital advocacy tools,” he adds — a series of Digital Demos produced by Horizn. “We started taking these simulators and putting them in there, and engagement was amazing.”
When Jim Marous considers the digital customer experience, he sees the need for the human touch. “There definitely needs to be emotion, personalization, and experiential components to an organization’s digital model.”
Though People’s is modest in size, with a market capitalization of $60 billion, it faces some of the same challenges as the big five banks in bringing its staff and customers into the digital future. In trying to better serve its customers, Vakacherla says, “we want to fit our products and services into the customer’s life journey and not ask them to take a detour.”
Looking ahead to 2021 and beyond, Vakacherla has some ground rules for operating in this new digital age: “The first thing I would say is, do not underestimate the importance of culture, leadership and discipline.” Next, he says, “employee experience is as important as customer experience.” He encourages banks to listen to their customers and understand their needs.
And ultimately, he adds, any organization preparing for the future must learn to embrace technology. “We are putting [new technology] in the hands of the people who are facing the customers and supporting their various lines of business. And they have embraced that so well.”
Listen to the full podcast above.