 |
| Figure1: How
to Improve Customer Experience Through Digital Transformation (Source: Sheth, 2020) |
Digital Transformation
Digital Transformation has become a trending topic across the banking world at present, due to the incredible attention that every stakeholder is paying on transformation. Moving from manual activities and usage of paper, to automation, straight through processing, digital forms, chatbots and many more can be described as digital transformation. A complete end-to-end digitisation of a bank can easily be done if the employees and the customers are open to change.
 |
| Figure2: Digital
Transformation and the Customer Experience (Source: The Townsend Report, 2017) |
This
includes the reduction of paper through front-end digitisation, elimination of
manual tasks and duplicative efforts through implementations such as chat bots,
straight through processing and various self-care applications for customers to
serve them-selves, rather waiting for a banking assistant to support them for
their services.
Are there any barriers to digitization?
A
study has stated the barriers of digitization as “(a) regulation and
government, (b) customer demand, (c) level of competition, (d) cost of
greenness at the organisational level, and (e) attitude toward change” (Kamalulariffin
et al., 2013 cited in Diener and Spacek, 2021, p.5). “In practice,
technological investments entail not only risk, but also require an
understanding of the relationship between technological and organisational
culture and institutional change within certain boundaries of regulatory
frameworks” (Diener and Spacek, 2021, p.1).
Are customers interested in digital transformation?
Figure3:Digital
transformation is about people, not technology
(Source: Heller, 2019)
(Source: Heller, 2019)
There are customers who prefer to visit branches and get their services done with the support of a banking assistant, rather getting their work done through a chat bot or a downloaded application. Eg: Senior citizens are not very familiar with the technology, hence they prefer filling and signing hand written documents rather digital forms. However, it was noted that these scenarios are very minimal, compared to the customer audience who prefer digitisation, due to the vast number of benefits the customer get to experience, such as time save, cost save, flexibility, convenience and many more. Cuesta et al., (2015) also explains that the widespread use of the internet and mobile phones has resulted in a significant shift in consumer behaviors and preferences, as people have grown accustomed to using digital media to communicate personal information, conduct business with government agencies, purchase online, and access new services.
 |
| Figure4: What
is Customer Experience?. (Source: Raju, 2019) |
It
is evident that “the banking sector is changing and institutions have to adapt
to new technological developments and customer behaviour” (Diener and Spacek, 2021,
p.4). This is due to the fact that, “the application of new technologies and
their appropriate implementations to improve business performance is an
important issue for companies” (Ismail et al., 2018; Westerman, et al., 2014
cited in Diener and Spacek, 2021, p.1). Therefore, banks are under massive
pressure to transform their approaches and business models to a more
customer-centric approach in order to remain competitive.
Conclusion
As
per the above study, it is noted that in the present context, customers are
more prone to digitization, due to the convenience, time and cost saving it brings
out. Although there is a minute audience who prefer the old banking process, since
the positive impact of digital transformation in a bank is higher than its
negative aspect, banks are largely investing on end-to-end digital
transformation to remain competitive in the industry. Through digital
transformation, the customer experience indeed enhances in a drastic level.
References
Cuesta,
C., Ruesta, M., Tuesta, D. and Urbiola, P., 2015. The digital transformation of
the banking industry. BBVA research, pp.1-10.
Diener,
F. and Špaček, M., 2021. Digital Transformation in Banking: A Managerial
Perspective on Barriers to Change. Sustainability, 13(4), p.2032.
Keeton, W.R., 2001. The transformation of banking and its impact on consumers and small businesses. Economic Review-Federal Reserve Bank of Kansas City, 86(1), pp.25-54.
Sheth, R., (2020) How to Improve Customer Experience Through
Digital Transformation. [ONLINE]. Available at:
https://www.smartkarrot.com/resources/blog/digital-transformation/ [Accessed 11
December 2021].
THE TOWNSEND REPORT, (2017) Digital Transformation and the
Customer Experience. [ONLINE]. Available at: http://blogs.infostrat.com/2017/01/digital-transformation-and-customer.html
[Accessed 11 December 2021].
The rise in digital engagement and interest in the Internet of Things (IoT) has prompted businesses to innovate swiftly and replace old ways of engagement. Furthermore, because many Millennial and Gen Z customers are digital natives, they use more channels than prior generations, including social media, email, SMS, chatbots, and more. Companies now have the capacity to provide fast communication, seamless cross-channel support, unique customer journeys, and a better level of transparency to their customers as a result of the digital revolution. These technical advancements have become the norm, and today's digital consumer expects them.
ReplyDeleteDigital transformation is one of key factor that help organization to improve their efficiency. This will help to reduce the operational cost and transaction time which help to increase the customer satisfaction. Very interesting article.
ReplyDeleteThe customer experience is a critical component of the digital transformation of business processes. Or, to put it another way, many digital transformation initiatives are born out of customer (experience) problem areas, marketing needs, and growth or transformation requirements.
ReplyDeleteThank you so much for your valuable comment.
DeleteCustomer experience is an essential factor in business that plays a vital role in digital transformation. Innovation and improvement in customer experience is an important element that paves the path for the growth and success of a business. Companies such as Amazon have become the prime example of digital customer experience. Amazon is now a global organization, with its customer obsession and leveraging technology the company focused on long term growth (Voxco, 2021).
ReplyDeleteThe customer experience plays a crucial role in digital transformation or better: many digital transformation iniatives arise from pain points, business/innovation needs and growth/transformation imperatives on the customer (experience) side of business. a VERY GOOD ARTICLE.
ReplyDeleteThe banking system of a country like Sri Lanka can be digitized. But there are those who have consumer knowledge regarding digitization, and there are consumers who have no knowledge of that. Despite the inconvenience to the banking system, it is now necessary to work for the needs of both parties until they achieve 100% success someday in the future.Thank you.
ReplyDeleteThank you so much for your valuable comment.
DeleteAs it transforms customer relationships, internal processes, and value generation, digital transformation is a worldwide topical problem of key importance for all organizations in all industries. But this is not suitable for each and every person. I agree with your point of view because most senior citizens refuse to use digitalized services and prefer to receive service from a staff member using traditional methods.Thank you for sharing this interesting article with us.
ReplyDeleteThank you so much for your valuable comment.
DeleteThe integration of digital technology into all areas of an organization, resulting in substantial changes to how the firm works and delivers value to customers, partners, and workers, is referred to as digital transformation. Your article is proves the importance of digital transformation bring in best customers to the sector, Thank you
ReplyDeleteThank you so much for your valuable comment.
DeleteThe integration of digital technology into all areas of an organization, resulting in substantial changes to how the firm works and delivers value to customers, partners, and workers, is referred to as digital transformation.Thank you
ReplyDeleteDigital Transformation have largely benighted to banking sector, Manny customer service of banking sector, have been Automated to digital platform. It have enhanced customer satisfaction by providing convenience, time and cost savings services, thank you for sharing this article.
ReplyDeleteThank you so much for your valuable comment.
Delete