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Ins and outs of digital transformation in the financial sector

The digital transformation has been in full swing for years – including in the financial sector. Banks, insurance providers and other financial services firms seek to make careful, well-considered investments in value-adding technologies, but Drahomir Hruby, Managing Director at Cegeka Czech Republic, has observed that they aren’t quite sure exactly how to start their transformation projects. “It’s not all about the front-end,” he begins.

When it comes to doing business in the digital era, customer experience takes the spotlight. “It’s no different for financial institutions,” Drahomir continues. “Customers expect first-class, omnichannel digital experiences with every company they interact with, and that includes their banks and insurance providers. This has led to a strong focus on customer-facing financial services portals – but an imbalance when it comes to back-end automation and integration.”

Balancing customer experience with employee experience

It’s only natural for banks to want to visibly showcase their digital maturity to the outside world.

“It makes perfect sense; they want to enhance the loyalty of their existing customers and attract new ones,” says Drahomir. “But the workflows, productivity and effectiveness of their people is also important. Of course, this must be balanced with the goal of maintaining profitability by reducing costs and increasing margins. Digitalization is indeed the right way forward for the financial services sector, but a front-end-heavy approach will always lead to projects that don’t, in the end, add value.”

Digitalization is indeed the right way forward for the financial services sector, and an approach that balances the front and back ends is key to adding real value – for both customers and employees.Drahomir Hruby, Managing Director of Cegeka Czech Republic

The key, according to Drahomir, is to balance the customer experience with the back-end. “This is the only way to gain the most benefits from digital transformation in terms of automation, efficiency, profitability, and employee and customer experience.”

Empowering personnel to serve customers even better

If the digitalization project is properly managed, bank personnel and relationship managers can grasp a whole new host of value-adding advantages.

“Digitalizing workflows in asset and portfolio management, and in mortgages and loans, doesn’t eliminate jobs – on the contrary, it makes them even more effective,” Drahomir goes on to say.

“For example, before a financial institution grants a customer a loan, they must first assess the risk associated with the customer assessed and generate a proposal. If all of the data needed to do so is centralized and available, and if the digitalization project covers the entire process from front end to back end, this can be done automatically. The result? Relationships managers have time to offer tailored services, rather than focusing their efforts on performing repetitive manual tasks and administrative work.”

Jupiter: a complete foundation for digitalized asset management services

To cater to the needs of the finance sector, Drahomir and his team developed Jupiter, an all-in-one solution that automates every single workflow and process associated with offering and managing investment products.

This project-oriented software solution includes a database, transaction kernels, analytics and reporting and can be fully customized as needed. In addition to customer-oriented and managerial reporting, Jupiter offers regulatory reporting that fully complies with the requirements of national banks and stock exchange commissions.

Read more about Jupiter

Think big, start small

That being said, a comprehensive digital transformation project in the financial service industry begins with small steps.

“When I say comprehensive, I mean that it’s important to take a holistic view of the institution and its interlinked processes – not to tackle the entire project all-in one go,” Drahomir asserts.

Based on his 15 years of experience with integration projects in the financial services industry, Drahomir offers five key learning points for getting started:

  1. Begin by identifying the most important bottlenecks and pain points in your processes.
  2. Define the simplest jobs to be automated – these will serve as the low-hanging fruit and quick wins needed to pave the way for larger digitalization projects
  3. Approach your first project as a small element of a much larger, more complex process.
  4. It’s not just excellent customer experiences that lead to better results; the employee experience is key to sustainable digital change, efficiency, productivity and ultimately, profitability.
  5. Integrate the third-party systems that your company relies on to unlock organization-wide digital advantages and new technologies like machine learning and robotic process automation.

The future of financial services is here

Once the data is appropriately staged and the right tools in place, it is very possible for a financial services company to harness the power of machine learning and artificial intelligence.

“These technologies can automatically and rapidly detect risky behavior based on customer spending patterns, for example, or to assess the readiness of a potential mortgage customer and enable straight-through processing with accurate risk assessment,” continues Drahomir. “Potential risk can be addressed in timely manner through early detection, and intelligent, automated solutions for risk scoring and Anti-Money Laundering (AML) are also within reach.”

“Optical character recognition can lift the enormous burden of paperwork from your people by digitizing, harmonizing and standardizing information documents and contracts. Chatbots augment your workforce by enabling 24/7 customer self-service, boosting the consistency of the customer experience and your ability to sell.”

“The technologies are ready, data and some tools are usually available on the customer site. All you need is a roadmap and an experienced, competent transformation partner, whether you’re already highly digitalized but want to go further, or just starting out on your journey.”

Learn more about our Asset & Portfolio Management solutions