The evolution of technology

How to build a cognitive bank in five steps

Evgeny Scherbinin, CEO of Prime Source

To survive, let alone to prosper, a modern bank has to be convenient, proactive, mobile, transparent and profitable all at once, and it has to be good at calculating risk. This is the model of the new digital “normality” for banks, and it can be reached in five steps.

1. Reforming the approach to IT.

This means moving from buying systems to implementing and applying technologies. The outdated approach was to take a boxed CRM or an unwieldy, accounting-oriented core banking system and break every process to fit it. Why perform heroics in peacetime? A set of flexible technologies already exists for quickly building unique business processes. They include BPM (business process management), BI (a self-service reporting tool), RTDM (real-time decision management), Data Governance and others.

2. Reforming the organizational model.

Business technologies should be implemented by dedicated teams following a flexible project methodology, Agile for example. Headcount limits cease to apply, and using professional outsourcing within teams adds the necessary experience. According to PMWorld Journal, up to $145 billion is spent worldwide every year on unsuccessful projects, while delivery based on Agile enables 75% of organizations to achieve the desired result, and in 82% of cases no budget increase is required.

3. Digitizing processes.

Take a look at your bank. Automation there is almost certainly organized around departments. Each of them solves its own task — the contact center, debt collection, operational servicing, sales. Processes designed “the way it suits the departments”, each focused on its own KPIs, often turn into circles of hell for the customer. In the modern approach, by contrast, building processes around the customer journey with the help of flexible technologies makes it possible to achieve synergy in the customer’s interests.

4. Cluster partner systems along the customer journey.

It sounds complicated, but it works. Today a bank owns only a small share of the information about events in a customer’s life. To broaden its customer “horizon”, a bank needs to integrate with telecom companies, marketplaces, social networks, aggregators and retailers. Exchanging events in real time anticipates the customer’s needs, leaves no time for a competitor’s product to be bought instead and stimulates demand, including through gamification models.

5. Cognitivizing the business — replacing people with robots that have unlimited capabilities.

Robotization components based on artificial intelligence make it possible to create unique products and processes, significantly reduce operating costs and provide a new level of convenience for the customer. Let me give the main components of cognitivization as an example.

Computer vision for robotic customer identification.

Resource savings through the automated handling of paper documents (OCR).

Software robots (RPA) to free employees from routine back-office processes.

Speech recognition and voice biometrics, automated communication with customers in voice and chat channels.

Predictive analytics — an advanced mathematical toolkit for sales, risk and debt collection.

Real-time decision-making to instantly identify a chain of customer actions and shape communications to the customer at the moment when they really need a product.

Forbes No. 08 (96)