The 2023 banking industry crisis left a lot of us unsettled and more worried than ever about customer retention. We all want to feel confident our customers will continue to choose us, but how? Start by giving them a great experience.
Business process management (BPM) can help you meet and exceed customer expectations while improving operational efficiency and managing regulatory compliance.
If you're Googling "bpm in banking," you're not alone. It's an approach to improving organizational processes. It sounds technical, but it’s really not so hard to understand. Business process management is a way for companies to discover, design, execute, measure, and optimize their business processes. And this is great for banks. Let me explain.
Using BPM technology in the financial services industry can help make banking processes more efficient to continually strengthen performance and those all-important KPIs. Companies that use BPM technology see fewer banking errors, lower business operations costs, and have happier customers. (And happy customers are loyal customers!)
Here's how BPM can help financial institutions like yours simplify complex processes, fulfill regulatory requirements, and meet market demands to get and keep customers.
Learn more about BPM's role in digital transformation with our BPM Guide.
Business problem: If customer onboarding feels tedious, time-consuming, and inconsistent to you, imagine how your customers feel. In fact, prospective customers frequently abandon their applications because of conflicting information they receive from online and in-person customer service channels during the onboarding process. Slow response times lead to account openings taking days or weeks to process. This is such a waste.
BPM solution: One successful North American banking company faced with this problem chose to use a BPM-driven process to engineer a centralized account opening solution. They created a shared service to orchestrate processing and fulfillment of both online and call center channels, standardized forms for all channels, and set up internal approvals with an automated workflow.
Result: Once BPM was implemented, customers started to move through a consistent and speedy onboarding process. Better customer interactions led to a dramatic decrease in account abandonment and increased customer satisfaction. Additionally, BPM has made it easier to adopt new applications and operational costs have been reduced.
Business problem: Manual and paper-based processes in lending are cumbersome, inefficient, and prone to errors and security risks. When errors occur, they can have detrimental effects on customer satisfaction—especially if they put the applicant's loan at risk of delay or worse.
BPM solution: When a customer applies for a loan at an institution with BPM technology in place, all the data collection can be done digitally. The BPM system can create a highly detailed loan application binder for the customer. The application can be automatically moved through the system, and bots can manage the workflow and alert stakeholders to their assigned tasks. BPM systems can also integrate with other applications, such as your CRM, for case management.
Result: In a short span of time, the loan origination system can transition to a completely automated version, where all forms and processes are completed digitally. The increased efficiency and ability to track loans throughout the process helps ensure they are completed in a timely manner. Employees save time and no longer have to deal with tracking a manual paper process and customers receive better service.
Business problem: Your customers’ needs change all the time, but banks don’t always make it easy to purchase additional products or services. People may not even know what retail banking solutions their current bank offers. Similarly, bank employees may not be able to easily sell additional services to existing customers because the process for upselling isn’t clear.
BPM solution: BPM allows companies to digitize all their existing paper forms and product and service application steps. This helps employees make changes to customer accounts easily and helps customers apply for additional products quickly. They no longer have to start from scratch, manually filling out paperwork to apply for a new product like a credit card.
Results: By having one centralized customer record that connects to each of a financial institution's product offerings, employees can see the full status of the account. Branch staff can be prompted to introduce new products at opportune moments, leading to increased sales. Faster processes and efficiency also mean better customer service and satisfaction.
What comes next? Once you've implemented BPM, it's time for Business Process Optimization.
Business problem: Customer service levels are lower than many institutions would like them to be. This can be due to many factors, but is often tied to slow processes, errors, delays in service, and lack of clear, consistent communication. A customer who tries to get assistance over the phone may be directed to a number of people and still not get a clear answer. They may try to contact customer service online, but find staff doesn't have the information from the agents who spoke to them on the phone.
BPM solution: With BPM, financial institutions can track customer issues more efficiently and ensure employees -- whether in a call center, online, or in person -- all have the same information. Customer issues can be addressed quicker. Customer service metrics like response time, resolution rate, and more can be easily tracked so organizations know where they need to improve.
Result: Increased customer service and satisfaction helps banks retain more customers over time. This also helps increase trust among customers and better service makes them more likely to become vocal supporters of the institution.
Business problem: Adherence to regulatory requirements is a primary concern for the financial industry—especially after this year's banking crisis. Human error becomes easy to introduce when processes are manual. Emailing sensitive data back and forth can make it vulnerable to hackers, and handling data in spreadsheets can easily lead to typos or copy and paste errors. Human processes may also result in critical issues being missed.
BPM solution: A BPM system provides more security to reduce risk—both the risk of human error and that of outside vulnerabilities like cyber attacks. Banking business processes that use technology like artificial intelligence and robotic process automation (RPA) have better fraud detection. This technology efficiently checks for anti-money laundering, compliance, and KYC verification, significantly reducing risk.
Result: Financial organizations can spend less time worrying about risk and compliance and more time planning for the future and implementing new products. BPM makes banks more agile when regulations change as well, so you are able to react faster to remain in compliance. Customer data is more secure, and vulnerabilities are decreased.
BPM allows organizations to improve banking services and banking operations to better adhere to compliance requirements, improve business agility, processing time, and customer service operations. By cutting down on repetitive tasks and disconnections in processes, customers receive better service and choose to stay with their banks for longer.
KYC can be a particularly involved process for banks—and it’s an excellent place to try out BPM. Want some tips to get you started? Try our guide to KYC process automation.