Downsizing: A Blessing in Disguise?

The catastrophic global recession of 2008 sent ripples through the banking sector. Many banks struggled to cope with massive losses suffered because of debt they accrued through somewhat risky investments. Banks, like the Lehman Brothers, went under and others are only now starting to recover by taking the same risks but in a less haphazard way.

The effects of increased regulation and cost cutting in the financial sector have seen global banks downsize their talent pool with the exception of compliance roles. The negativity about job losses aside, the streamlining of the business processes could create positive outcomes in the retail and corporate markets.

The IT department, which has suffered most from downsizing, will have to achieve more with less as the banks try to keep the lights on with fewer resources. However, this is not an impossible task as first feared as automation becomes more common.

Big Data and the Internet of Things (IoT) have allowed banks to obtain all the necessary customer data to make informed decisions in various areas from product development to sales campaigns. Specialist technology has allowed banks to make those decisions because it acts as a middle layer and brings together all the data from all the silos across geographic and business lines. Using automation to improve the back-end of the bank’s IT infrastructure does not necessarily have to result in a decline in customer service levels. These improvements will help in delivering bespoke offers to individual customers, and can, subsequently, become a more integrated process.

The digitisation of the front-of-house is in motion to deliver innovative retail branch services and customers have been the biggest drivers behind this. The implementation of self-service kiosks and do-it-yourself banking terminals, where Barclays has led its competitors in recent years, have replaced manned teller desks. This development is empowering staff to have more in-depth conversations with their customers and provide better, personalised financial advice. Online banking has also grown exponentially as customers choose to avoid their local bank branch for the convenience of banking on the go, or on the sofa.

The automation of manual processes frees resources up to be invested in innovation that will make the bank’s and the consumer’s lives easier. This automation can take the shape of collating customer data from all the departmental silos found within the bank’s technical infrastructure. By examining the different products customer use, banks can create new services and products based on how often and where a customer uses the product. The analysis of data will provide banks with the intelligence to sell deals based on the individual needs of every customer. This not only increases customer experience and retention, this will also improve product ownership for banks too.  

Reducing staff often has political and economic consequences which some politicians will want answers to. Improving customer service through the automation of manual, mundane back-end tasks is a reasonable response. For those banks who want technology to deliver more exciting services, there definitely isn’t a shortage. For instance, Deutsche Bank, is partnering with disruptors like Bitcoin, who are bringing the world what’s happening now, to the masses. By reducing the excesses of middle management and adopting new, streamlined, business processes, banks can deliver results to the customer much faster than they previously could.

The reality is, the rise of the machines has not arrived. Where humans add value and computers cannot, is delivering context behind the data. Having context on why a customer made a certain decision over a product is crucial for the boardroom to understand. The downsizing of staff obviously produces a perception of an economy which is still reeling from the global financial crisis. This could, however, be a boon for financial service providers who are endeavouring to improve their IT infrastructure and produce a more customer-friendly service.