Banks find it difficult to realize the promise of reducing channel costs by adding digital services, as their customers still need automated teller machines (ATMs) and branches to conduct transactions, despite the fact that banks have added phone apps with mobile deposits.
According to the third issue of KPMG banking sector report; Sri Lanka Banking Report– December 2018, as customer interactions increase, bank executives are seeing revenue decrease due to the number of channels required for service.
The report suggests that in order to compete more effectively, capture the inherent value in digital channels and reduce the cost to serve of traditional channels, banks must better organize themselves by removing organizational silos and seamlessly aligning the entire organization around the customer.
The report further highlights that this goes far beyond front-office and customer-facing functions. It involves aligning five key stakeholder groups: customers; employees; partners and alliances; front-, middle-and back-office functions; and the broader digital ecosystem.
Furthermore KPMG research shows that when companies move away from the limitations of operating in functional silos and toward what KPMG defines as a connected enterprise ,an organization that is connected and aligned across businesses, functions and channels, they outperform their competitors.
The research found that, while eight in 10 banks were placing a high or top priority on being connected, too many banks are just ‘checking the box’ when it comes to customer centricity, focusing on multi-channel tactics masquerading as a connected enterprise strategy. For those banks investing in a more customer-centric approach, four in ten indicated it had positive returns on their return on investment (ROI) metrics and for most, it exceeded expectations.
The need for customer centricity is now being felt across the C-suite.
KPMG International’s 2018 Survey of Global CEOs in the Banking Sector found that less than half believe they are achieving ROI from their investment in customer experience. In a separate survey of more than 3,000 global CIOs and other IT executives conducted by KPMG and Harvey Nash in 2018, 55 percent cited “enhancing customer experience” as a top business priority.
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