Presentacion de Kwafo Ofori-Boateng en el 34º Congreso de Marketing para el Negocio Financiero, 3 y 4 de septiembre de 2018.

1. #IBMbanking
Presented By
Kwafo Ofori-Boateng | Global Leader
Digital Front Office Transformation
IBM Banking & Financial Markets
Digital Transformation
The Future of the “Digital Experience”

2. • Customer Experience Optimization
• Optimizing Customer Journeys
• Operating Model Optimization
• Business Model Transformation
• Operating Model Transformation
• Governance Optimization
• Focused on experience
• Customer Focused
Enterprise
• Focused on Analytics
• What do we do differently
• How do we deliver
differently
• Reinventing the Organization
Digital
transformation
• Process Model Optimization
• Digitalizing Processes
• Cost Optimization
• Focused on efficiency
• Enabled by technology
• Accelerated by best practices
Digitization
Digital
reinvention
The Path of Digital Banking “Experience”

3. Economic
value is
shifting to the
customer
interface
Source: Bain & Co., Evolving the Customer Experience in Banking 2017, Dec 2017
0%
20%
40%
60%
80%
100%
Revenues Profits
“DISTRIBUTION”
“MANUFACTURING”
Revenues and Profits by activity
2016, $ billions
1,871
2,085
47%
53%
65%
35%
748
404
4.4%
20%
RoE
Economic
Value Shifting
Focus of Client
Spending
Higher growth spending
areas are focused on
deploying newer
“digital” capabilities
including:
- Channels
- Analytics / Cognitive
- Value added services
- Ecosystem / platform
enablement
Spending on traditional
back-end areas (e.g.,
payment engines) is
large, but slower growth.
Spending is focused on:
- Structural cost
reduction
- Operational efficiencies
Back
Office
Product-centric
Legacy
Office
Legacy
Systems
Front
Office
Customer-
centric
Digital Office
Omni-channel journeys,
Experience
Orchestration,
Ecosystem
Integration,
Value added
services
Migrating
Functionality

4. You will be
faced with
critical
questions
THE WHAT
Source: Bain & Co., Evolving the Customer Experience in Banking 2017, Dec 2017
What business outcome are you after?
• Growth (new markets, new segments)?
• Increase share of wallet?
• Reduction of customer churn?
• Reduction of cost to serve?
What is the target audience you are looking at?
• Millennial?
• Small and Medium Enterprises (SMEs)?
• Other niches, e.g. travelers?
What is your differentiating value proposition?
• Product differentiation?
• Service Differentiation?
• Customer touchpoint experience?
• Underlying processes?
Who do you want to become?
2
1
3

5. You will be
faced with
critical
questions
THE HOW
Source: Bain & Co., Evolving the Customer Experience in Banking 2017, Dec 2017
What you need to do become that?
What are your natural strengths?
• Customer base?
• Low servicing cost?
• Strong analytical capabilities?
• Which other existing, leverageable structures?
Which customer service model?
• Conversational banking (automated)?
• Human channels (contact center)?
Which operating model?
• Which focus – distribution vs. manufacturing?
• Which ecosystems necessary?
5
4
6

6. Four main digital banking archetypes have emerged
Source: IBM
Product, sales
and marketing
Shared from related traditional bankCapabilities within digital bank
Own
Own
Own
Own
Bank charter from
related bank
Channels
Back office
Bank charter
Own
Own
Own
Own
Own
Own
Bank charter from
related bank
Shared/leveraged
from related bank
Bank charter from
related bank
Shared/leveraged
from related bank
Sharing or re-skin
from related bank
EXAMPLES
Digital brand1 Digital channel2 Digital subsidiary Digital native
1 Separate or sub brand 2 Including banking correspondents

7. Long-term
trend of
customer
behavior: the
shift from
branch to
digital
Source: Bain & Co., Evolving the Customer Experience in Banking 2017, Dec 2017

8. You have to
look deeper to
understand
what this
means
Source: Bain & Co., Customer Loyalty in Retail Banking 2016, Dec 2016
10% of customers
generate
60% of all branch
transactions

9. First, what’s
the value of
branches in
this digital
era?
• Location is #1 factor in choosing banks
• ~60% of new accounts are opened in a branch (Japan)
Revenue
Generator
• Complex transactions often require face-to-face
interactions
High Value
Transactions
• Branch closure results in 9 point drop in NPS (U.S.)Customer Service
• Corporate image & brandingIndirect Values
• 51% of customers would start banking with another
bank with more convenient location
• $200-400 per customer (U.S.)
Cost of doing
business

10. The evolution
and the need
to take a fresh
look at the
roles of
branch, teller
& their KPIs
Transaction
center
• Profitability
• Transaction
processing
• Efficiency &
accuracy
Sales center
• Profitability
• Transaction &
sales
• Efficiency &
accuracy
• Cross-sell
Relationship
center
• ???
• ???
• ???
Branch’s role
Teller’s role
Teller’s KPIs
~ 1995 1995 ~ 2015 2015~
Branch’s KPIs

11. The changing
roles of
branch-based
employees
Roles 5~7 2~3
Skills
Single-
skilled
Multi-skilled
Tasks
Repetitive &
high-value
Mixed. Mostly
high-value
Mindset Do it for you
Do it with
you
Priority
Role-
specific
Total rela-
tionship
Old New
Manager
Supervisor
Merchant Service
Advisor
New customer
Customer
Teller
Manager
Universal Associate
Specialist

12. Branch
Transformation
= New
distribution
model based on
new service
delivery
models,
enabled by new
digital
technologies
Digital Technologies
- Every tech has a purpose
Distribution
- Hub-and-spoke network
- Smaller footprint
- Audience targeted design
Delivery
- Shoulder-to-shoulder intimacy
- ”Do it with you, not for you”
1
2
3

13. Define what you want to be… and where you are…
…and then integrate the capabilities that make it happen
Aim for full flexibility, ability to cater for changing needs, new
technology components and your strategy, which will change
Think big, start small, deliver fast to production
Path of Success