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Global financial institutions are facing an increasingly difficult marketplace - where profitability of existing products and services is eroding. Events such as globalization, waves of consolidations, regulatory modifications and the advent of Internet domination are forcing financial institutions to abandon the transactional business models they have practiced for decade.
Their focus now should be on improving the efficiency of their processes and transforming of their customer relations models. This could be done with the integration of appropriate technology driven implementations.
In the current global environment, the strategy for attaining organic growth may be different within each institution. However, the implementation of the following practices is essential to achieving measurable growth.
Establish Global Economies Of Scale
As financial companies grow larger and become global, they need to leverage modular state-of-the-art system technologies, which would improve efficiency and lower costs. Centralizing business units processes will result in economies of scale.
All non-core commoditized transactions could be outsourced, which would create a financial competitive advantage for the institution. Outsourcing could cut costs by as much as 60%. It could also be a vehicle towards transforming internal corporate processes.
Streamline Product and System Complexity
Many financial services companies have grown through acquisitions and mergers. This kind of growth usually results in duplications in products, internal business units, processes and the systems that support them. New business models are imperative to reduce the impact of conflicting business cultures.
Organizational barriers need to be broken down, redundant systems should be purged, and various systems would need to be standardized. Outdated legacy platforms have to be upgraded, resulting in faster product development and improvement in customer acquisition. All of the above would engender solid competitive advantage for the financial institutions.
Link Customer Loyalty To Operations
As operations are streamlining, financial institutions must focus on offering excellent customer experience. Most financial institutions lack the requisite operational processes and technology tools to offer exceptional customer experience. The right tools will enable these companies to better support their customers without necessarily increasing their costs.
Improve Customer Experience
Growth realized through multiple acquisitions ultimately result in confusing customers. They feel like they are doing business with several companies. What is needed is for financial companies to integrate their channels to provide a unified customer experience that better serves their customers. Satisfied customers turn into long-term loyal customers. Maintaining exceptional customer relationships is crucial to acquiring and retaining customers.
Embed Compliance Into Advanced Processes
Regulations, such as Basel II are costly and technology intensive. Financial institutions should implement compliance processes that would process automation with embedded controls, globally integrate views of business activity by customer and product, and transparency in reporting to support supervisory reviews.
M. Isi Eromosele is the President | Chief Executive Officer | Executive Creative Director of Oseme Group - Oseme Creative | Oseme Consulting | Oseme Finance
Copyright Control © 2011 Oseme Group
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