Bank Operational Efficiency Asian Banker Summit 2012

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Strategies to improve operational efficiency in retail banking as presented at the Asian Banker Summit 2012 by Verint.

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  • Operational efficiency priorityStrategies to improve efficiencyCost centres to targetExamples of key efficiency initiativesVerint’s role in driving efficiency
  • AdministrationSalesCustomer serviceOther rolesOther parts of bankStreamline, automate processesEliminate processEliminate paper
  • Most of transactions handled by a teller are cash-relatedAlmost 600 headcount productivity improvement in this example (if based on minimum saving of 0.5 per branch)Improve check cashing and cash deposit times from 2 minutes to 1 min 15 seconds50% reduction in robberies50% reduction in insurance premiumsEliminate need for two people to open the branch (dual control)Support cross-utlisation of roles (service advisor dealing with cash)
  • Bank Operational Efficiency Asian Banker Summit 2012

    1. 1. Increasing competitiveness and cost efficiency through effective enterprise-wide optimisation and automation Simon Angove, SVP & GM Verint, Retail Financial Services Asian Banker Summit Bangkok, April 26, 20121
    2. 2. Emerging Asia lags global banks in efficiency Figure: Emerging Asia bank Banks vs Global Banks: SE Asian versus global banks cost-income ratios (2010) Avg. 2010 Cost/Income Ratios 0.70 0.66 0.60 0.63 0.57 0.50 0.51 0.40 0.30 0.20 0.10 0.00 Philippines Indonesia Thailand Big 5 Global Banks Source: FT Banker Database, Verint Consulting, Asian bank financial statements2
    3. 3. Operational efficiency a top priority Figure: Asian bank executives top priorities for 2012 Increase revenues Raise efficiency Achieve or maintain regulatory compliance Increase customer satisfaction Cut costs Improve supplier relationships 0 0.5 1 1.5 2 2.5 3 3.5 4 Source: Ovum 20123
    4. 4. Efficiency matters but so does service Figure: reasons for leaving a bank Quality of Service 55% Ease of Use 51% Fees 50% Interest Rates 49% Quality of Advice 45% Accessibility/Convenience 45% ATM Locations 39% Product Availability 36% Branch/Bank Locations 36% Personal Relationship 35% Brand Image 27% Rewards/Loyalty Programs 24% Peer Recommendations 19% Source: 2011 Retail Banking Voice of the Customer Survey, Capgemini, 20114
    5. 5. Many strategies to improve efficiency Channel Process migration simplification Branch network rationalisation Digitize paper- Branch open based work Branch hours review automation Role optimisation Staffing Customer optimisation self-service Portfolio simplification Vendor Workforce rationalisation flexibility Price optimisation Lean structure5
    6. 6. Branch labour is largest operating expense Most operating expense Labour cost is largest is in branches Operating Cost Breakdown for a Typical Community operating expense Bank Other Overhead 4% 5% ATM, Call Center, Online 6% Labour expense Marketing 47% 15% Branch Network Other expense 50% 53% Operations 20% Source: Selected Asian bank financial data6
    7. 7. Workforce optimization (WFO) strategies Accurately scheduling branch staff to handle forecast workload while meeting service and sales goals and reducing unproductive time 1. Forecast Demand 5. Analyze and Improve 2. Calculate Staffing Needs Workforce optimisation process 4. Monitor 3. Schedule Performance Employees7
    8. 8. WFO #1: Reduce excess staffing capacity Accurate workforce planning approaches can identify up to 20% over-staffing relative to forecast workload and service levels 180 Figure: staffing needs versus actual staffing 160 Over-staffing Under-staffing 140 Percent Correct Staffing 120 100 80 60 40 20 0 Branch A Branch B Branch C Branch D Branch E Branch F Branch G Branch H Region Source: Verint Consulting, disguised client data8
    9. 9. WFO #2: Leverage all forms of staff flexibility Use part-time staff to match customer traffic and reduce idle time Full-time staffing: 56 hours Part-time staffing: 24 hours 6 6 4 4 Staff Staff 2 2 0 Open Lunch Close 0 Open Lunch Close Leverage 5 kinds of staff flexibility to maximize productive time Flex Hours Different Work Blend Work Between Worked in a Shift Start Different Between Roles Week and End Locations Bank (Universal (Part-Time) Times (Float Pool) Departments Banker)9
    10. 10. WFO #3: Maximise staff productive time Productivity assessments can identify unproductive tasks and poor handling times by role in the branch Figure: Sales role customer facing time Figure: Detailed activity breakdown Alpha Bank 47.49% 52.51% Industry 63.65% 36.35% 0% 20% 40% 60% 80% 100% Client-Facing Time Non-Client-Facing Time Source: Verint Consulting, disguised client data10
    11. 11. WFO #4: Make smart use of branch automation Teller cash automation can accelerate cash handling times by 40% while delivering faster customer service and heightened security Figure: staff savingsfrombranch Cashteller cash recyclers Staff Savings per Teller from Automation 1600 1400 1483 1468 1443 1383 1298 1200 1159 1000 Branches 981 800 730 600 521 400 321 200 173 38 88 17 6 1 0 > 0.0 0.1 0.2 0.3 0.4 0.5 0.6 0.7 0.8 0.9 1 1.1 1.2 1.3 1.4 1.5 Headcount Savings per Branch Source: Verint Consulting, disguised client data11
    12. 12. Global leader in actionable intelligence12
    13. 13. Broad banking solution portfolio Multi-channel workforce optimisation engineered for financial services Workforce Management Desktop and Video Customer Process Analytics Traffic Analytics Speech & Text IP, TDM, Analytics and Screen Recording Enterprise Quality Feedback Monitoring Management Performance Management eLearning and Coaching Enterprise-wide13
    14. 14. Verint clients have strong cost-income ratios SE Asian Banks vs Global Banks: Figure: all banks versus Verint clients cost-income ratios (2010) Avg. 2010 Cost/Income Ratios 0.70 0.66 0.60 0.63 0.57 0.50 0.51 0.44 0.40 0.30 0.20 0.10 0.00 Philippines Indonesia Thailand Big 5 Global Verint APAC Banks Clients Source: FT Banker Database, Verint Consulting, Asian bank financial statements14
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