Good communication is the key to transacting business of any kind. Banks are not immune to the effects of communications-related breakdowns and should, in fact, be even more diligent in this regard than organizations in other industries. After all, banks are dealing with other peoples' money.
Today's financial institutions are faced with even greater communications challenges than in the past since they increasingly are performing on the global stage - whether they have operations outside the United States or clients in other countries. Communicating a bank's brand and policies and serving customers across borders and in countless languages while operating within the bounds of an infinite number of regulations is vital to remaining competitive and in retaining the public's trust. This is especially true when dealing with something that often is considered more valuable than money - customer data.
Uniformity is critical as banks expand their operations to international markets. According to Tom Kraack, managing partner for human capital transformation in the financial services group of Chicago-based Accenture, many banks still have not gotten a handle on the concept. "I don't think you see people in the banking environment playing in a global way," Kraack says. "They may operate their business framework in multiple countries, but the data network, technology, workforce, economic measures, are still controlled locally."
This parochialism, in effect, masks the complexities of doing business at the international level. Kraack says this is not as true in other industries, such as automotive manufacturing. In part, he attributes the behavior to inexperience. "The global footprint for banking is relatively new," he explains. "You've only really seen this in the last 25 years or so with banks because of the stiff regulations with cross-border entry. This phenomenon has come about mostly through major global acquisition." In addition to the usual problems associated with mergers, including systems integration, banks now must deal with different languages, cultures, standards and procedures, Kraack notes.
"The goal is that if a change happens in a product or market strategy, you want to rapidly migrate that information across borders," Kraack continues. Employees need access to the same information, whether they are in the home office in New York or a branch in Tokyo. Clients also demand a level of assistance that is equal across all channels of the bank - branch, phone or Web - across the globe. The message that must be communicated is consistency.
Along with this comes the need for more-unified technology platforms across the organization. The technology is there to enable this, but banks have to be willing to leverage it, according to Tim Evans, head of Palo Alto, Calif.-based Hewlett-Packard's worldwide financial services business. "Take ATMs, for example," says Evans. "They can be used for withdrawals, transfers and inquiries. These are the same functions you have at the branch and on the Internet. The only thing you can't do at home is withdraw cash," he notes. "So why do you need a separate branch application, a separate ATM application and a separate Web application?" he asks.
Of course, this is easier said than done given the number of banks that must deal with legacy systems. Unfortunately, many banks are implementing new technology in a piecemeal manner. "There are a lot of point solutions out there," observes Mark Melillo, VP, financial services, with Newtown Square, Pa.-based enterprise software solutions provider SAP America. "Banks struggle to integrate related point solutions. You have departments in the same bank using different systems. How are you supposed to communicate like that?"
Tony Kleckner, director and practice leader for financial services at Basking Ridge, N.J.-based communications technology provider Avaya, agrees. "Some people are missing the boat if they're only selectively integrating channels," he says. "You want consistent branding across all channels to provide consistent quality and data to customers. The best-in-class folks want to optimize and integrate their channels."
Further constraining this integration, says Accenture's Kraack, is that banks often struggle with just how much control to give to the local facilities versus the international headquarters. "The money and resources are often controlled within each country," he says. "Very large multinational firms struggle to figure out the right amount of control and investment at the enterprise level and the local level." This confusion can hamper investment globally.