Banks’ back-offices: disappearance or transformation?
Back-offices are not about to disappear. That certainly would not be a good thing.
84% of banks’ management staff think that the banking sector will be going through “major, significant transformations” over the next five years. Automation, digital improvements, artificial intelligence… They all bring up dreams for tomorrow. And these very dreams turn into fears when it comes to back-offices employees who often are casualties from optimisation decisions.
Value chain transformation (more intermediation, technology-driven strategies); redesign of the current business model (end of the universal bank) … What path is the banking sector going to follow?
Whatever the way, banking back-offices do have a future: new skills are valued.
Back-offices are key for transformations
Digitalisation and Lean management reduce repetitive tasks. Back-offices teams can shift towards projects. Their business expertise has become essential in that field, making easier to frame and implement projects: new distribution patterns or market segmentation, institutions mergers and rationalisation, white-labelling, automation, outsourcing… They help give a steady rhythm to IT deliveries with cycles increasingly agile, hence fragmented.
Operational teams get more and more committed to project culture. They also increase their business expertise.
Back offices are also integrated in the customer journey
Low value-added tasks tend to disappear from back-offices. Optimisation and cut backs have been made in many fields: beginning of a business relationship with a customer, contract life-cycle management, accounting, administration management, collection, supply management, claims administration:. Customers are globally satisfied, especially when it comes to deadlines. This had side effects on teams. One out of two employees point out the lack of support in communication, training, coaching, events. Among these employees, back-offices operators are often the most forgotten.
Employee and Customer experience maps have highlighted that back-offices can now endorse major responsibilities: advice and expertise suppliers, risk analysts, business advisor’s partners on specific cases, complementary services/products sales and profit maximisation when renewing a contract…
The future of Back-Offices is out of the box
Success stories are spreading all around, telling us about back-office activity managers who create or help turning opportunities into reality by mastering their processes and tools and by stepping out of their comfort zone: partnerships creation, active support by visiting clients or suppliers, forward proposals when designing business tools…
Repetitive and periodic actions give room to proactiveness and interactivity. Even Finance departments – which are freed from time-consuming tasks during closing periods – will focus on their analysis job to become the partners for development projects. We are switching from the picture of the introvert accountant or finance employee who is isolated with his Excel files towards an actual sponsor working with business developers as a team.
Tomorrow’s challenges are there: to hire back-office operators who are experts in their field and empathetic, to break walls to enhance collaborative work with business people and clients, to build a customer-employee experience for each key process.
Customers will know how to recommend those who respect them.
This text was first published in French in Point Banque.