Operational Excellence in Financial Services

Top 3 Pillars Driving Financial Services OpEx

Achieving Operational Excellence is fundamental to financial services firms driving forwards today, but how do these enterprises go about delivering on their promise to customers, shareholders and its staff?

TOP 3 STRATEGIC PILLARS IN FS:

(1) Leadership;

(2) Customer-centricity;

(3) Employee Engagement.

We add insight from Sophie Leng-Smith, Vice President at Deutsche Bank, about the Bank’s award-winning techniques to successfully drive transformation.

Pillar 1: Leadership

Attaining buy-in from senior management and the alignment of your operational excellence transformation strategies to your overall business strategy is of course fundamentally crucial, but this is where leadership really comes into play.

Firms which have their senior management and indeed stakeholders bought in and leading from the front with clear instructions, translating vision into reality, will strive forwards faster and further with their operational excellence efforts and journey.

Without strong leadership an organisation’s OpEx or transformation program can steer off course.

There’s a difference between someone talking the OpEx talk, it’s another to actually walk the walk and lead from the front. The same can be said when looking at the current rules within the organization.

A good leader shouldn’t just throw out all of the rules, they need to embrace customer-centricity and employee engagement to determine which rules are working, which ones need to be enhanced, and perhaps which ones need to be thrown away.

Deutsche Bank’s Sophie Leng-Smith explains that although the financial services world can be very hierarchical and have a very ‘command and control’ nature to it, this needs to be broken down to be successful, but at the same time finding a formula to keep the control.

Not only does Deutsche Bank train their senior executives on methods and tools that can be used to help drive operational excellence, they also have a Center of Excellence. This installs a leadership team in place to help look at the process enterprise model. They create and govern the model, and with it the changes and initiatives, such as heatmaps to visualize tools and areas of improvement.

Pillar 2: Customer-Centricity

Seeing the value of data and leveraging and illustrating that not only to front-line staff, but to customers. The customer should be at the heart of everything that we do.

“A core challenge when getting people to use the programme as part of their everyday business, is to ensure that the customer is put at the heart of everything they do,” says Leng-Smith. This is very true for those that work in back office functions, who are quite removed from the customer: “Using objectives and PMOs, we got them to see past their work and see how it ultimately impacts on the customers and how people are using their work to make decisions.” Getting employees thinking about regulators is also key for the Voice of the Customer (VoC) focus.

“It’s about getting people to think we’re making it a safer place for people to do business with us. That’s what regulation is all about, it’s not just there to make things difficult for us, it’s about making things better and easier for the customer,” explains Sophie.

Pillar 3: Employee Engagement

Leng-Smith believes that if people see the value in change, they will support it: “If change has made work more interesting and fun, why would they want to go back to the old ways?”

Getting employees engaged and actively involved at every level of your OpEx programme paves a path to success. Top-down orders don’t go down well, but regular, transparent and visualised dialogue helps to get people on board. Performance dialogues, whiteboards and daily huddles empower your employees to be part of the process, identify bottlenecks and share ideas and innovation about how to improve operational excellence practices.

Education and Training were also voted on by respondents and would certainly come under the employee engagement pillar. Helping employees to further understand how operational excellence can make a difference to their own role, but imperatively for customer satisfaction, which will reflect in your CSP points. Even if it’s with back-office staff, getting them to buy-in to this change and mindset can help to further smooth out any silos and enhance the customer’s end-to-end journey.

Leng-Smith said at Deutsche Bank over 4,000 of its staff were put on a mandatory eLearning training course. Further insight into knowing when processes are performing and also to make sure that the right governance is in place: “Working in a wasteful process is not the best thing, but being empowered to make changes happen is.”

Continuous Improvement (CI) helps you to sustain your OpEx programme, for LengSmith it’s “all about people”. At the bank they wanted to get 50% of their people “living and breathing CI as business as usual within an 18-month period”. Sustainability is all about getting people to enjoy their work more and they’ll keep doing it in the new way. When Sophie joined Deutsche Bank, everyone was logging their CI ideas into a log book.

On the face of it, it can be seen as a wasteful resource of time, but those logs created the opportunity to tell the senior executives how each of the teams was really doing, where change opportunities had been identified, and it ultimately helped the Bank create its metrics.