This is a moment of reality where you have to make sure that you are relevant in the lives of your customers in more ways than we've all imagined ourselves to be relevant. I think that's a big ‘penny drops’ moment and the more we can deliver for customers, the better off we will be in making sure we are relevant.
A blunt assessment of the new commercial reality from Suresh Viswanathan, Chief Operating Officer for banking firm TSB as he argues that organization's customer base has undergone an enforced shift to digital thanks to the COVID-19 pandemic:
My sense is that the moment of digitalization of banking, especially retail banking, this is it right now. When we look back in 10 years time, this is the point of inflection where it just tipped over and most people who thought that they could get by without engaging digitally are being forced to. That’s very exciting for us because it allows us to engage with customers in more forums than we thought possible.
And once customers have made the digital transition, it’s unlikely that they’ll want to go back to their old ways of engagement, he suggests:
We are tracking the number of customers who want to engage only analog with us. People [have been] forced to download the app or get to connect to our web platform. For me, what is interesting to watch is how many actually have made a payment using the platform and how frequently are they doing it? Once you have the convenience of actually doing that on your phone…. once you have the combination of convenience as well as safety, it’s very difficult for customers to go back to the old way, very difficult.
The events of the past few months have also inevitably been a learning curve for the bank itself, he adds, even though the organization had been on the journey from a largely analog construct to one that is “aspirationally far more digital”. At the end of 2019, there had been an 18% year-on-year increase in mobile app users and over 75% of customer transactions were being carried out via some form of automated banking channel. Since then, that digital aspiration has undergone a massive acceleration, with Viswanathan estimating that 2-3 years of learning has been compressed into 2-3 months of what he calls “experienced reality”.
Many of those learnings were around lessening or removing dependencies on analog aspects of the operating model, such as activities that involved customers having to go into a branch, which in lockdown conditions isn’t a viable proposition for most:
For example, in the unfortunate event of one of our customers passing on, the next of kin had to make a physical visit to a branch to actually process the remainder of their estate, and [there were] many, many more things like that. When you suddenly have that taken away from you, you've got to come up with a response to it. You’ve got to think on your feet. You really don't have the time to construct this [new model] inside of your banking apps and then test and deploy. You don't have the time for that.
So we chose to go with a partner to deliver our forms online for our customers. That was the first big step that did not necessitate people to visit the branches. We had to construct it in a way that it was secure and then we also had to construct the way by which customers could figure out where all these things were. So a basic chat capability had to be deployed so that people didn't spend all their time searching for stuff on our external internet pages. We put together some fairly interesting technology…in the hope that everything that [customers] had to do in an analog fashion, we had an immediate response for them [digitally], especially because they were going through a difficult time.
TSB also had to re-examine the way it worked internally as an organization, he adds:
All of us were so used to meeting rooms and physical interactions that it took us the first week to sort of get our heads around [the change]. I suppose we were all in planning mode, but no plan survives reality, as we all know. The good thing is we've been so heavily deployed on the [Microsoft] Office365 stack, working from home became very, very easy for us. We’ve gravitated to Teams - the whole company works on Teams. We've stopped printing - I've not printed anything in the last sort of 6,7,8 weeks. So by default, the company has gone from being a mixture of analog and digital through to all of us learning to work digitally. Our customer servicing activity, over 95% of it, is now done digitally by us. It's not something we would have dreamt of three months ago.
The shift to universal remote working is another example of enforced acceleration of a capability that was already underlying, but which had not been put to widespread test. Viswanathan explains:
The ability for people to connect from home has always been there. The question on our minds was scale. We did some level of testing before we locked down all of our offices and got people to work from home. We had never answered telephone calls from the homes of our employees. We were forced to do that, as were many banks.
That meant a reliance on robust telephony infrastructure, which was delivered by BT, but also called for TSB to re-think some practical considerations about its own processes and policies, he says :
It’s easy to answer the phone from home but if you’ve got a kid that's crying in the background or it's a noisy environment, that’s not how you want to service customers even in a difficult situation. So we had to go through a lot of planning around which sort of colleagues will be able to do what sort of work from which environment. That involved a lot of management of logistics at our end.
Security was also an inevitable concern, one that was, as Viswanathan describes it, “fixed in flight” with second and third line evaluations executed during deployment:
Once again what would have taken maybe 12 to 18 months - project, funding, business case - was all done in a matter of three to four weeks. Once again we relied on tools. You know, especially in banking, we are very guilty of trying to pick up the best of breed in a particular sliver, and somehow pretending that we could orchestrate across multiple best of breed solutions. All that went out the window. Practicality took over, so it was a lot easier to get things done in this environment.
TSB was also helped by the historical fact of not having built out its own data center estate when it was spun out of the larger Lloyds Banking Group in 2013, tapping instead into third party provision from the likes of IBM and BT. As Viswanathan notes, this means that when a customer calls up 0800-TSB, the call goes on a journey, from landing in a BT cloud ,through the CRM aspect running in an Office365 cloud, to the banking platform built on an IBM cloud. So by the time an agent asks the inevitable, ‘What’s your mother's maiden name?’, the customer request has been through several infrastructure and service providers.
That’s a benefit if the right pieces are in place, argues Viswanathan:
You can actually move parts of your infrastructure very, very quickly. But it's terrible when things break down because then, like the human body, you're not too sure whether it's the lungs or the heart or the brain? Which part of the system actually has a problem? If you don't have those diagnostics in place when you're trying to become a digital player, you're in trouble. Therefore, step one of the journey was making sure that we were not encumbered by our own legacy infrastructure.
Step two was [working out] how do we get to world class and how do we therefore have a single pane of glass with which we manage, both proactively and reactively, so that we are always available for customers? That’s easier said than done. We know how [the tech] industry has worked for a long time. There’s a lot of hype and actually no software that underpins the hype. Whoever you are - big banks, small banks - you're eventually going to have a foot in both camps, something in the public cloud, something on prem. The ability to actually manage across these environments is super-critical, because you are definitely going to run a pair of establishments for a very long time to come.
There has also been an unintended consequence of COVID-19, that of bolstering TSB’s confidence as a company in its customer services capabilities, which took a hefty knock back in 2018 when a massive IT failure saw 80,000 customers switch their account to a competitor. Viswanathan concludes:
You go from sort of not believing in yourself to getting your colleagues to work from home, going digital, customers [have the] capability to chat with us, here are all the forms that you ever needed to go online with us. Just sort of the mental strength that we built up as a team is an enormous plus.