Mortgage Introducer July 2022

Page 18

REVIEW

TECHNOLOGY

Tech and thinking about change Jerry Mulle MD, Ohpen

I

n May this year, Elias Ghanem, vice president and global head of Capgemini Research Institute for financial services, said, “Banking is in a state of flux. Some 82 per cent of bankers are struggling to identify new customer segments, and 49 per cent claim they are struggling to deliver personalised content through the right channels. “Consumers today, when they look at banks, see three levels: service, value, emotion. Yet when they go to the bank, 29 per cent report they are not getting service banking; they are not seeming to get this basic thing they want. “It’s essential for the banks to have a big shift in their mindset.” What a statement. And a true one. The thing is, the banks and building societies wanting to compete in future and appeal to younger generations swayed by a neon bank card already know they need “a big shift in their mindset.” The milliondollar question is around how they can do this. For institutions trusted with billions of pounds in customer deposits and responsible for supporting access to homeownership for millions of people each year, delivering this is a more complex conundrum. What Mr Ghanem hit on when speaking in May was the three things that matter to the end customer: service, value, and emotion. When a start-up considers its business plan, the point of its product or service is paramount. Always, the point is whether it gives customers what they want. Having identified this as the business objective, how that’s delivered

16

MORTGAGE INTRODUCER   JULY 2022

becomes a case of making the tech do the work. When a 150-year-old bank still running on code abandoned in the 1970s considers its business plan, it should be just as simple. Does it give customers what they want? Too often that’s a no, but frequently it’s not because of a lack of desire; rather, it’s because of a realisation that the legacy tech that underpins everything means that the core platform and processes cannot deliver what is required – unless the organisation is prepared to invest tens of millions. And even then, they can’t really be sure they will get everything they need. It’s the reason why, historically, the biggest banks and building societies are such a patchwork of technology: the slick front-end interface is a purpose-built shiny veneer designed to make customers think they’re being given what they want. But this approach does not deliver an improved target operating model or customer experience. At best it is an improved process, but rarely for the borrower – particularly when something goes wrong. The shift in mindset Mr Ghanem refers to hinges on exactly this point. If you start with service, value, and emotion, understanding the scope of what your business needs to do to thrive long-term becomes much simpler. Putting that into practice where legacy tech has historically proven a barrier to growth or expansion can feel daunting, though, especially given recent and notorious examples of migrations from one system to another causing devastation. There is another way to think about investing in technology to improve your service, however. It’s to recognise that evolution is constant. What the customer wants today is different from what that same customer will want tomorrow. In five years’ time, it will be unrecognisable. Hardly the basis for

arguing the return on investment that upgrades would offer. Some see this as a threat. Those who see it as an opportunity are thinking with a new mindset. The speed of change enabled by technology’s development has changed the way we need to think about change. We aren’t moving in visible steps in today’s economy; delivering value to customers means constantly evolving service and reacting to customer emotion on a personal level. This means flexibility becomes fundamental. It means developing the ability to power up one element of service one day and power down if or when demand subsides. The ability to serve a localised demand virtually instantly and turn off the cost to the business when that need ceases. Flexibility isn’t just a nice jargony word for ‘new.’ It’s the definition of how banking must deal with the way people function in today’s world. The answer? Cloud platforms that provide affordable scale, agility, interoperability, robustness, and security to enable lenders to deliver better operating models now and in the future. M I

www.mortgageintroducer.com


Turn static files into dynamic content formats.

Create a flipbook
Issuu converts static files into: digital portfolios, online yearbooks, online catalogs, digital photo albums and more. Sign up and create your flipbook.