Workforce in the Digital World of Banking

When computerization was introduced in the Indian banking industry in the early 1990s, there was furore amongst the staff in the public sector banks. The Banks were heavily unionized at that time with the federations/associations predicting loss of jobs especially at the clerical cadre and even at the officer/Middle Management level. Their reasoning was quite simple and if the jobs they are engaged on a daily basis at the branches which includes voucher posting, accounting and consolidating the General Ledger is being done by a computer, they may not be required. Even at the regional/zonal and Head office of the banks, there were staff who were compiling the MIS by receiving information from different branches associated in a region and they dread about a potential job threat considering the ability of banking software to consolidate the data from any locations without dependency of staff at branches. With the addition of ATMs there were more worries with front office staff /tellers of the Bank about job security.

However, over a period of time, the bank staff realized that computerization increased the number of bank jobs, improved efficiency and automation at braches/Head offices, brought more transparency, helped in process improvements and assisted the Management in obtention of timely data for decision making. There was minor reskilling required for data entry and branch operations and with the knowledge of banking, such skills were easily acquired as the data entry was related to banking processes. There were select staff with basic computer knowledge who gained proficiency and was able to move up the value chain.

With the extent of success received and potential of technology realized, the Management of many Banks moved ahead with further digitization and computerization equally recruiting people with unique skill sets retaining the existing ones. The phase saw the addition of channel banking – including internet, mobile, other channel offerings. The internet and channel banking reduced the customer foot prints at the branch and there was no reduction in the staff strength. On the other side, Bank staff were able to utilize more time for customer service and cross selling. Private banking/preferential banking services came into existence which helped customers (though the select ones) to get more personalized attention and have a better banking experience. Instead of customers visiting the branch, their financial needs were addressed by the dedicated relationship managers/private bankers. The financial portfolio of customers widened to a large spectrum of banking and other financial products such as wealth management products. Banks could leverage the situation and evolved as financial advisors managing the entire financial needs of a customer.

Similar to the sentiment expressed in 1990s, the bankers are increasingly worried about software solutions linked to process automation, artificial intelligence,analytics and other IT related activities like infrastructure and managed services moving to separate cloud service provider currently. Compared to the computerization and implementation of software solutions in the past, which was a real necessity of that period, the banks and software vendors are exploring areas for usage of these software components. However, the path and course of this journey for the Bank is topsy-turvy and though there are limited successes like chatbots for customer assistance which are used in few Banks, there is no set pattern or leadership status attained by any bank for others to follow. Process automation has been implemented in many Banks earlier but there were limitations and will continue to evolve with new automation tools launched but still miles away in the journey to maturity.

While software is being increasing used as the backbone for digitization, the success of digitization depends on the usage by clients and support provided by Bank staff. In a typical customer journey from Marketing to Sales to lead Management to Account Origination to Servicing to Support where some of the events could be partially or fully automated, there could be processes which are dependent on the bank staff. The TAT for a manual /semi- automatic process can be reduced or exceptions can be approved faster with quick decisions and the customer queries can be responded faster with awareness of software and underlying functions. The customer experience in the digital applications play a critical part for the success/longevity of these services/offerings. With the evolution of technology new innovations are plenty and existing ones are likely to lose steam in a short run.

To conclude, the skill set of the bank staff in the 1990s were one of banking/domain knowledge, book keeping, customer relationship /service, computation of data for MIS, manual accounting – interest postings, Non Performing Asset ( NPA) provisioning etc. With computerization, skill sets moved to computerized banking, process knowledge, relationship management, channel banking and operational efficiency.

The digitization and the end to end automation is expected to bring a sophisticated environment for bank staff as well as the customers providing a plethora of functions and opportunities to explore from both sides. Though the process automation and introduction of banking robots could potentially replace some of the existing skill sets required, Banks can find avenue how to effectively utilize the man power. More customers can be added to the 'personalized banking' platform assuring delightful customer experience and thereby increasing the customer engagement with banks for a mutually beneficial business relationship.

As the complexity of banking products and services is increasing with more focus on digital, the Bank staff has to evolve and one need to learn to service customers with new digital services /solutions and gain sufficient knowledge on the relevant areas in the new environment. Digital products and services can be more marketed and sold through the branch staff and existing customers can be serviced better when the staff is aware of the intricacies of these offerings. Though a customer would be pleased to complete the entire process of a financial product life cycle in a hassle free manner through digital way, the personal attention of a bank staff would be necessary to have a meaningful engagement with the customer.

For the banking staff, awareness of Analytics, knowledge of banking processes and practices for automation, awareness of digital platforms and technologies and their usage will make an impact in the next decade. However with a basic banking /process knowledge these are not traits which are difficult to acquire and are promoters for job retention. 

It can be assumed that in  the long run, Banking job will be more lucrative and attractive moving away from routine data entry , voucher posting and process practitioners  to one  using analytics and automation to improve existing banking operations and providing delightful customer experience