Consumerization — the infiltration of consumer technologies into business organizations — is proving to be a very good thing for financial services firms. Whether it involves allowing employees to use their own mobile devices as work tools or driving changes in online and mobile banking interfaces, this transformation in how both customers and employees interact with their banks/employers is creating exciting opportunities for richer, more customized and potentially more profitable relationships. This is a goal banks have been striving to reach for decades, so far with only mixed success. But consumerization has the potential to make this goal much less quixotic.
It's not just about devices. The consumerization-driven expectations of "always on," ease of use, integration and personalization can be viewed as just the latest iterations of the long-standing concept of "anywhere, anytime" service and interaction — a concept that 20 years ago was considered radical and elusive within the banking industry, but that provided a foundation for the multichannel delivery models that are standard operating procedure today. We're seeing the impact not only in the bring-your-own-device (BYOD) movement, but also in marketing strategies shaped by social media and search techniques; real-time transaction processing and customer service; and new, more-customized and targeted approaches to product development.
But consumerization also comes with costs and potential risks. BYOD may make employees happy and even provide some resource efficiencies, but it's not cheap. A company with 1,000 mobile devices that uses a BYOD approach spends an extra $170,000 per year, on average, according to Aberdeen Research (due mainly to more fragmented procurement and billing procedures related to BYOD). And CIOs, CISOs and other technology executives are only too aware of the risks to corporate and customer information when business processes are conducted via personal mobile devices.
These days, however, resistance to consumerization is futile, and banks are not alone in embracing the inevitable. Seventy-three percent of C-level executives who responded to a recent Avanade survey said that supporting the use of employee-owned technology is a top priority, and 60 percent said their firms are updating IT systems to make this easier. No bank executive can ignore the potential of consumerization to address the industry's long-standing challenges regarding collaboration and productivity— it's one technology development that has gone beyond buzzword and trendiness to be truly transformational.
[Banks face big hurdles to engaging consumers in the mobile era, says Dell's Bob Barris. He offers tips for getting closer to customers.]
Katherine Burger is Editorial Director of Bank Systems & Technology and Insurance & Technology, members of UBM TechWeb's InformationWeek Financial Services. She assumed leadership of Bank Systems & Technology in 2003 and of Insurance & Technology in 1991. In addition to ... View Full Bio