Addressing the human dimension of the digital revolution in banking
Digital HR (DHR) improves customer satisfaction, increases productivity and boosts the bottom line
They used to say that running a bank is like having a license to print money. Many of them – including some of Hong Kong’s biggest – do still print their own banknotes. But, what people really mean is that banking can be an extremely profitable business.
However, as Boon Khoo, General Manager for SAP SuccessFactors in Greater China told attendees at the recent BankTech Executive Summit, the digital revolution is changing that picture. It is putting banks under the same transformational pressures as other industries.
His presentation highlighted the critical importance of prioritizing a focus on people. In fact, according to research by Gallup, an engaged banking workforce can boost customer satisfaction by 10%, productivity by 17% and profitability by a healthy 21%.
Why Digital HR Matters
When it comes to HR, the maturity level varies from bank to bank. It can range from disparate, mainly manual processes at one end of the spectrum, to automated, cloud-based, full-scale Intelligent Enterprise-class solutions that enable employees to focus on higher-value tasks and strategic initiatives.
But, that split is changing quickly, as more banks understand and embrace the benefits that DHR – Digital HR – can deliver.
Build an organization for the future
The rationale for transitioning to digital HR isn’t complicated. For one thing, it’s a powerful way to align the vision and mission of the CHRO (Chief Human Resources Officer) with the goals of the CEO.
Another key benefit is improved global operational efficiency, which enables real time insights that translate into increased profitability. Managing payroll processes with Robotic Process Automation (RPA) can also reduce complexity and speed things up. Improved service delivery leads to better support for internal organizations, other geographies, cost centers and job structures.
Win the war for talent
FSI is one of the most hotly contested markets for talent. According to a report from the recruiting expert Hays, technical specialists in data and finance – precisely the people banks need – are set to remain in especially short supply this year.
Taking a digital approach to HR can pay big dividends in the battle to attract and retain top performers. That includes improving traditional roles, such as candidate relationship management, where it can enhance the process of engaging with, nurturing and hiring top talent. Embedded AI can also accurately determine and match workforce roles and readiness.
However, the real payoff is the extra depth that DHR delivers by adding extra layers and capabilities, such as anytime, anywhere feedback that improves the overall workforce experience. That’s the kind of thing that existing employees value. New candidates who have experienced it in the past will down-check any prospective employer who doesn’t have it.
Improve Customer Service
As Boon pointed out at BankTech, an engaged workforce has a tremendous impact on the bottom line and customer satisfaction. He noted that the journey to creating the ultimate customer experience starts by nurturing the ideal employee experience!
A DHR solution can help along the way, such as by providing a top class experience for all users on all devices. For any generation who practically live on their phones, it’s a vital consideration.
DHR also helps to reinforce diversity and inclusion policies, and support well-being at work initiatives – two areas that are getting a lot of attention in the news and which cannot afford to be overlooked.
Keep up with compliance
Meeting compliance requirements and managing risks isn’t easy for financial institutions. Embarrassingly, two of the five firms on Compliance Week’s 2018 list of ethics and compliance failures were from the banking industry. And the financial cost and potential brand damage of missing something important is escalating.
Again, DHR is making all the difference. Compliance training and certification via machine learning algorithms mean it is now possible to provide ‘smart’ recommendations to each employee, based on their job, skills, and learning preferences. In addition to adapting to constant shifts and changes by creating an agile workforce, robust tracking and auditing capabilities enable banks to meet regulatory requirements and deliver reporting in real-time.
To stay ahead of competitors banks need to prioritize new business models and processes, including DHR. Many are already doing just that. For example, HSBC has already announced it is looking to shift all of its global HR systems into the cloud with SAP SuccessFactors in a two-year “big-bang” implementation.
Banks like Hang Seng Bank has commenced with chatbot technology. Externally, chatbots empower customers to raise simple FAQs and queries of one’s account; while internally chatbots provide employee with rapid responses when look for resources and self-service requests.
But, no matter how big or small the bank, people are one of the most important investments. A comprehensive DHR solution will help unleash their full potential while driving results across the business.