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Automation in banking – no one size fits all

November 2020

Over the last ten years, the financial services industry has been dominated by themes such as; disruption, digital transformation, customer experience, ecosystems and innovation. Reading a financial services article is likely to bear reference to at least one of the above themes if attempting to explain what is currently happening to the financial services industry.

The proposed execution of disruption or innovation in financial services is regularly accompanied by the recommended use of one of the following automation enabling technologies; artificial intelligence (AI), analytics, machine learning (ML), blockchain, optical character recognition (OCR), or robotic process automation (RPA).

Automation Opportunities

With many of the banks´ middle and back office functions being characterized as having manual and repetitive tasks, as well as having multiple processes which are bolted-on (i.e. one on top of another) – the case for automation is an obvious one, and has hence received its title in banking as the “low hanging fruit” for many industry incumbents wishing to continue their innovation journey.

An Integrated Approach

Although the business case for automation almost writes itself, what´s not well understood is that applying one automation tool in isolation (such as RPA) can lead to one of two tactical risks:

  • A hammer looking for a nail – trying to apply RPA to every single process
  • Using nails to solve every problem – where other solutions are available

The alternative, is understanding that RPA forms part of a more sophisticated toolkit of individual technologies (AI, Chatbots, ML, OCR, RPA, Robotic Desktop Automation, RDA), which can be applied in an integrated and creative way to fully optimize the end-to-end banking supply chain, instead of solely automating an existing manual process.

Approaching the opportunity to automate with a design thinking mentality, and utilizing all the available automation tools in an integrated way, is often referred to as intelligent automation.

An Optimized Workforce – Moments of Truth

Relentless automation is not necessarily the answer. Automation ideally enables a talented workforce to add optimal value and experience to the steps of the process that matter to clients the most (after all banking is built on two cornerstone values: trust and relationships).

Automation does not offer exact equivalence to the values of an organisation (taking one of our own for example; personal). However, utilising automation can give organizations a platform to better fulfill core values - How?

Zoom in, Zoom out

Using a design-thinking approach for process improvement allows organizations to zoom in on the parts of the process which make the transaction worth-while for clients (“moments of truth”) and avoid team fatigue of supporting the binary repetitive steps (zoom out).

The experience banks offer at these particular moments of truth can be elevated and enhanced by workforce teams - who have since been relieved of the monotonous dull components of reaching that same moment, which existed in a previously manual process.

Longer-term impact

There is a common misconception that automation will eventually replace all humans and lead to mass unemployment. As with all technology, it is true that automation will shift the flow of employment, but this does not necessarily mean it will negatively impact it.

An example of where this has happened before: prior to the invention of cars, employment existed in horse-drawn carts with specialized employment in; cart manufacturing, wheel repairs, blacksmiths (for horse-shoes), and carriage drivers.

The arrival of cars eliminated many of the previously mentioned jobs, but in their place, created the need for mechanics, car manufacturers, car dealers, taxi drivers, and so on. In the same way, automation will shift the flow of employment from manual back office tasks, whilst creating the need for a number of other value-add positions.

Santander Corporate & Investment Banking

At Santander CIB, our innovation focus continues to be on a design-thinking approach for the delivery of utility; through which our core values can be transmitted to our clients and partners.

We have come to learn that intelligent automation, along with other innovative technologies, can empower our incredible workforce to deliver a simple, personal, and fair service at an even higher standard than has ever been previously possible.