Wincor Nixdorf: The building blocks of an omnichannel customer experience
Wincor Nixdorf is one of the world's leading providers of IT solutions and services to retailers and retail banking, playing an incremental role in taking customers into the digital sphere. Christian Weisser, senior vice-president for banking, discusses building an omnichannel strategy for financial institutions - and the key challenges this can present.
How do you think that the channels through which customers interact with their bank have evolved?
Christian Weisser: Digital technologies have transformed the customer experience, not just for their bank, but in peoples' daily needs and how they manage their lives. All that has a direct impact on the customers' expectations about their bank: 60% of the global banking population is using online banking at least weekly, and of course you see mobile banking rise heavily too. But on the other hand, we still have typical banking clients that prefer to use banking branch business processes for advice or, if it comes to it, more complex topics.
So a bank cannot underestimate this human factor, this human touch, and the retail banks know that this is a very important element when it comes to addressing and selling more complex banking products, so somehow this angle of customer expectation and the customer journey to the bank is more about providing a seamless process and providing a convenient customer journey.
Part of building an omnichannel strategy is bridging virtual and physical channels. Why is this so important?
Customers still value the human interaction physical channels provide, especially for sales and advice services, but what we really have to consider is the customer journey that is leading them there. McKinsey estimated that in a pure online based information-to-application journey, the leakage rate for the bank is around 85%. If the same process is branch-based, the leakage rate is only 15%. But it is far more likely that customers will start enquiring for a financial product online or ask for recommendations in social networks. On the other hand, the branch, and the branch network, will play a key role in the transformation journey to the omnichannel strategy. In times where the use of digital channels is growing, the branch is still the only channel for human interaction and needs to be renewed in order to meet customers' expectations.
Managing the customer journey intelligently from a digital to a human interaction in a seamless and convenient process is essential to maximising sales success. And to keep customers satisfied and engaged, banks have to ensure that customers can use services in the way that is most convenient and secure to them - this can actually involve different channels.
Smartphone-initiated cash withdrawals are a good example of that from our industry. Bridging digital and physical will also allow maximised productivity of physical channels and reduce infrastructure costs, like smaller branch footprints where more teller transactions can be moved to self-service systems, and more targeted and personalised approaches; for example, when branch staff get automated notifications about customers using the self-service systems, just to name a few from our business. So bridging this digital and physical platform would, from our point of view, maximise the productivity and reduce infrastructure costs.
Why do you think banks have traditionally been cautious about taking the initiative on this?
The main reason, I would say, is the infrastructure that banks come from: there's a lot of legacy systems with limited integration possibilities they have to take care of and, on top of that, over the past few years after the financial crisis, there's been the growing requirements of the regulators. Thus, banks are confronted with significant changes. On the one hand, banks need to invest in game-changing technology to meet customers' evolving needs and generate additional revenue. On the other, they need to streamline processes, manage costs and maintain their existing operational systems.
Wincor Nixdorf can help to stabilise the bank's transformation journey and thereby tremendously reduce the risk of failing.
What are the first steps for a bank looking to build an omnichannel customer experience?
At the beginning, banks should define their own retail banking strategy, including business-oriented KPIs, and they need to define the customer journey, including the involved-use cases, and implementation of new services to enhance the customer experience and improve operating efficiency. Synergies in technology have to be identified in order to enable cross-channel interactions. Then they need to integrate traditional channels to new technology - for example, web-based ATM multivendor platform - for readiness to be included in omnichannel strategies.
What role does Wincor Nixdorf play in managing this transition?
The digital revolution is creating opportunities for banks to transform their own operations, performance and relationships with customers. This is a very individual journey, and Wincor Nixdorf has the expertise, tools and solutions to deliver a bespoke package aligned to banks' precise needs. Our experience of implementing omnichannel banking is our competitive point of difference. Based on a defined retail banking strategy, we support our customers in designing smart processes and innovative solutions to enhance the customer experience and increase revenue.
As a global solution provider, we develop and package solutions for our clients to roll them out in their international networks. We thereby contribute to the need for standardised infrastructures, especially for customers operating across several countries, increasing operational efficiency - 58% of our net sales in FY14/15 were generated by software and services.
These segments are by nature driven by providing our banking customers with higher flexibility; for example, by operating ATM networks on a multivendor software platform, simplifying the delivery of updates or new functionalities to the network. Or by completely handing over processes in a managed service model to focus resources on core business needs.
What are the key challenges this process presents?
On the one hand, we help the bank to transform its business, but this is only possible if it's done in conjunction with the people in the branch: the tellers and the advisory staff. You have to help them change their role, from a teller to a seller, which is not an easy step for many people: if you make them stand and not sit behind a desk, for example, it changes the process a lot.
Our job is to help the bank to transform: by advising how to train them, what kind of guidance to give them, just to change this traditional role of the banker from a teller to maybe a mobile banker equipped with a tablet, and always standing maybe two steps behind the client, to help and assist or give some advice.
What do you think makes Wincor Nixdorf a good partner?
Wincor Nixdorf specialises in resolving these challenges. We are traditionally known as one of the world's top companies for ATM solutions in hardware. According to the latest study published by the UK market research company RBR, Wincor Nixdorf remains the market leader for multivendor ATM application software in Europe with 23% and Latin America at 29%.
Interestingly, we have also just been evaluated as the leading multivendor software provider in North America with 29% - a market in which we are not historically strong with our product business. This is proof that banks trust in the transformatory ideas derived from our software.
We are quite proud about where we are today, and that we are the partner of many very innovative and big retail banks, and that they make us part of their transformation. In every case, it's mission critical for the bank, so we also moved up to that level. This is mainly driven, of course, by stable hardware, but where we really distinguish ourselves from the competition is our power in providing software platforms, which provide the bank with omnichannel capabilities.
With over 40 years' experience of partnering retail banks, we have an unparalleled insight into this market. We have introduced pioneering technologies, and manage the industry's most comprehensive suite of retail banking products and solutions. We have a deep understanding of branch processes and process automation. Here, not only does a high level of automation translate into cost-optimised processes, it also gives branch staff more time to use contact with customers for consultation and thus to generate more sales opportunities.