Improving WX for banks and insurers: You can’t go it alone
- Posted on December 17, 2019
- Estimated reading time 3 minutes
Banks and insurers are complex organisations, with silos and working practices that often obstruct collaborative team working. Our research has found that there is a strong link between workplace experience (WX) and customer experience (CX) – and ultimately ROI. For example, attracting – and keeping – staff is easier if there is a compelling WX in place. The more staff you keep (and keep happy), the more customers you keep and the more profit you make through cross- and up-selling across your portfolio. Improved collaboration across the different silos and structures within your organisation means better and faster problem resolution and a greater CX.
But this requires business change and the involvement of groups outside IT. For WX to work effectively, HR needs to be linked into both IT and the business divisions. WX delivery requires expertise in IT and change management, as well as senior business sponsorship.
As we know, IT, HR and the business units have their own challenges.
- IT budget is spent on the maintenance of legacy systems, with little left for innovation. Upgrades are typically driven by ‘end of life’ dynamics or regulatory drivers. Projects are seen as business-as-usual rather than opportunities for transformation. In all this, employee experience is often forgotten or neglected. The only staff that appear to get special attention are those with mainframe legacy expertise.
- HR need to reduce office space and increase transactional efficiency. Attracting and retaining staff is becoming increasingly difficult given the competing offers from large technology firms and fintechs.
- Divisional CEOs are constantly targeted on improving their cost-income ratio. They see the value of new tools, such as AI and analytics, to identify next best actions in customer conversations or reduce process cost. But they want the benefits without serious investment in employee skills.
The good news is that most CIOs have good relationships with the business divisions and have a strong business mindset that sees technology as a key enabler of performance. However, HR has often been ‘the missing piece’ and is rarely brought in to major transformational projects, even though their input is critical, especially around workplace issues.
Our recent research into WX for retail banks and general insurers suggests this may be changing:
- When asked who should lead WX transformation, it was agreed that a board member should lead a cross-functional group of business, IT and HR execs (42%).
- 21% thought IT should work independently with no other functional leads involved. However, the percentage who thought IT should work with both HR and business leads increased from 12% to almost 20% - this was the highest increase of all the sectors we covered (including retail, manufacturing, consumer goods, energy, utilities and chemicals).
- HR want to be involved in such transformational work and are happy to work with IT and the business – almost half of HR respondents (47%) in financial services thought their roles should be prioritised when considering a workplace transformation initiative. Again, this was the highest response across all sectors covered (industry average was 38%).
- 72% of HR respondents said that adopting new workplace technology was the top priority in transforming the employee experience – again, the highest across all sectors (industry average was 63%).
- Significantly, when asked if employees felt empowered to make changes to the way work is done, responses were lowest among retail banks and general insurers (79%; industry average was 83%).
It’s clear that a holistic approach is needed to successfully develop a great WX. It’s clear that HR input is essential to such transformation work. It’s also clear that staff will not suddenly make these changes happen.
The benefits of getting WX right are significant. MIT Centre for Information Systems Research found that the top performers in this area doubled customer satisfaction and the rate of innovation as well as increasing profitability by 26%.
As part of their ‘A New World of Work’ programme, Raiffeisen Bank International wanted to use migration to Office 365 as the foundation for further digitization at the bank and a catalyst for a more innovative, collaborative way of working. They called this ‘A New World of Work’. This was viewed as a change management project, not a technology upgrade. We worked closely with the bank’s change, HR and communications teams as part of the project. This enabled collaboration across national borders, around the globe - even with external partners and clients. “Working together in an agile way and creating flat hierarchies requires a different culture and new policies. So, our focus was not only the new technology, but also change management," commented Wolfgang Hausner, the project manager.
Bringing together IT, HR and business heads is vital for successful workplace transformation. You can’t go it alone.