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From teller windows to touch screens: How technology is impacting banking

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There’s an old bank building in my town. It has marble countertops and wrought-iron gates at the teller windows. The original name of the bank – Farmers and Mechanics National Bank – is stamped into the concrete at the top of the building, even though the illuminated sign near the front door indicates that the building is now a retail branch of one of the bigger U.S. banking institutions.

Many of the bank’s customers rarely enter the branch at all, as they enjoy the convenience of direct deposit and online and mobile banking. But some things in the banking industry don’t change: When customers need answers about financial questions, they want the ability to speak to an informed bank representative, who can quickly access information from across the enterprise and then accurately convey it, whether it’s online, over the phone, or through the teller window.

That’s when it’s critical for a bank’s technological processes to be seamless.

Unique challenges for the banking industry

A recent global banking study supported by SAP revealed the three key drivers bank managers need to keep in mind for future business model transformation:

  1. They have to ensure that their technology is capable of keeping up with regulatory and risk management issues that demand a long-term business model instead of a focus on short-term profits.
  2. They need to stay on pace with technology innovations to attract new customers and retain existing ones, as well as to empower their employees to work effectively and efficiently.
  3. They need to be aware that today’s banking transactions are played out amongst the ever-present backdrop of social media, where one bungled transaction can create a formidable backlash.

So how can bank managers ensure that they’re getting the biggest bang for their IT buck? Study authors point out that faster implementation of IT initiatives can be key to creating value.

In addition, many banks are prioritizing Big Data and real-time analytics as methods to decrease costs and increase transparency.

Finally, utilizing cloud computing and mobile apps to create a more customer-centric approach can help develop better relationships with today’s highly engaged customers. Banks also need to keep in mind that clients are better-informed than ever before, so it’s critical for organizational learning from the top levels of the institution to be accessible to those people who are serving customers in branches.

For more information on how recent advances in IT support value creation in banking, read Benefitting from the Data Deluge.

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