NAFCU Services Blog

Feb 28, 2012

The Future of Retail Branch Banking: Waltons or Jetsons?

Guest post written by Bob Tramontano, Vice President of Marketing, NCR Corporation

Branch Transformation is now a ubiquitous term, synonymous with retail banking organizations searching for the golden solution to leave the past 5 years of banking turmoil behind and enter the next decade with a fresh, dynamic and customer-centric branch banking proposition. But do retail bankers really need to re-invent the wheel to create ‘Branch Transformation’?

Accessible modern technology exists which enables customers (your members) to select and enjoy a rich set of self discovery and self service options when dealing with their retail banker (your credit union), enticing and giving the member the power to easily move from impulse to action.

Retail bankers publicly declare that their strategy is to offer the very best banking experience – and yet, recent mystery shopping across the major name banking brands shows neither similarity nor progress, towards this ‘banking nirvana’, revealing only inconsistencies in the banking ‘experience’ as variable as their staff skill levels.

Retail banking organizations can be so pre-occupied with trying to define an ultimate ‘experience’ that they all but forget the reason that banks and credit unions thrived in the first instance and the simple fact that the “Branch transformation” roadmap is best designed around a return to traditional relationship banking methods, using available modern technology to simply ensure the member can access and consistently enjoy this ‘new banking landscape’.

Modern retail banking – closing the loyalty gap

Branch bankers are now realizing that they need to offer ‘Premium Banking Relationship Management’ as the norm, irrespective of member account balance or turnover, begging the question “Why did personalized service in branches ever become a commodity to be sold?”

You need to define what a ‘solid’ member-credit union relationship is before you embark on deploying what has become the technology norm i.e. an expensive CRM based project to protect, retain and develop your ‘book’. The measurement which has overall relevance here is – product uptake per household. Many North American based research documents, talk of banking organizations driving upwards of 8 products per household to achieve an ‘embedded relationship’, however mystery shopping the major brands, reveals a clear inability to achieve this figure, despite all that predictive core banking software.

In reality – a solid credit union : member relationship starts at a product count of 4, specifically checking account, savings account, credit card and mortgage / life insurance, easily achieved through consistently good service which then leads to greater wallet share as member life events progress, and they turn to their bank of choice for further support.

Retail branch bankers need to find ways to re-frame their engagement with their members to offer the much sought after traditional banking experience, but in a way which ensures consistency, differentiation and a sustainable ROI structure. The answer – self service and assisted self service technology solutions which simply offer improved presence and preference to the member.

Closing the intimacy gap – Technology to transform the retail banking experience

Retail banking organizations have been traditionally pre-occupied with either ‘beautifying’ branch design, speculative ‘prototype innovation’ or ‘using popular modern communication methods’ e.g. ‘we send you a text when you are near your limit’. However, what specific banking experience issues do such ‘innovations’ resolve?

The answer is none. The rules of transforming member experience in branch banking, incrementally, call for simple improvements in how members are handled, and empowering them to control their banking – just as they do with all of their other daily routines. Combine this strategy with a focus on staff relationship management skills, and differentiation is assured.

Manual processes have dominated branch banking for many years and have proved to be capable of providing members with very strong experiences, as long as the staff who manage those processes consistently adhere to them or good backup management exists to close the service gaps when a member of staff drops the ball. However, if process isn’t followed – members only see inconsistency, and report this as ‘poor service’.

Today’s retail branch specific technology allows members to select and enjoy a rich set of self discovery and self service when dealing with their credit union, enticing and giving the member the power to easily move from impulse to action. In the same vein, today’s credit union has a choice of solutions which allow them to truly support their staff to consistently deliver excellent banking service to members, every time – across the daily routine of relationship banking. Member and credit union can now enjoy the use of robust solutions designed to help eradicate the intimacy gap which has grown exponentially for some over the past few years, for example:

  • Simple software solutions which allow members to reach directly into their personal banker’s diary at any time of the day, from any banking channel & make or change appointments to see their relationship manager without having to penetrate bureaucracy. Closing the consistency gap means offering access, without barriers, every time.
  • Intuitive programming on new generation financial specific kiosks, designed to enable members to discover financial products, perform routine banking transactions and if desired, buy. Is the personal banker engaged? – no worry, the kiosk can bridge the intimacy gap and provide a consistent ‘personal banker experience’ until staff are free, or until the next visit.
  • Even the ATM channel is now being revolutionized by the first of a new breed of genuinely converged channel - Interactive Tellers. Multifunction ATMs, offering the choice of self service or a live, fully engaged audio/video experience with a remote based teller, immediately deployed at the member’s behest, who can drive the teller transaction on screen to close the ATM intimacy gap and expand delivery of the human banking experience to many more locations, inside or outside normal banking hours.

The building blocks to become truly world class retail banking organizations, with market leading reputations for relationship management and member satisfaction, are out there – simply combine best-in-class member interview / contact strategy with the practical, yet highly evolved branch specific technology that exists today - and get ready for growth.

This is a complex and pertinent subject, influencing credit union strategies today – for an opportunity to better understand how you can leverage technology to achieve best-in-class member experience in your branches, Bob will be speaking at the upcoming NAFCU Strategic Growth Conference, March 13-15 in Scottsdale, AZ.

Check out a video from NCR about branch transformation below.

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