3 takeaways on HCD in Retail Banking (and what we learnt from Deutsche Bank Innovation Lab)
As a feedback driven company, in Outboxers we travel around Europe to consult our visions with other experts.
This time we went to Berlin to visit one of the most visionary banking Innovation Labs in Europe, in the heart of where innovations start.
Here’s what we shared: 3 among the most important pillars which retail banks should work on to inject innovation in their processes, in the right way.
(The article is divided in 3 parts, each one with its own takeaway, at the top each section.
The first part describes the behavior of the market, the second one offers a way of approaching it and the third underlines a common problem when delivering innovation).
.0 WHERE ARE WE?
As long as companies are creating a market where the final goal is meeting clients’ expectations, customers are turning out to be more and more digitally spoiled: they know what they want and they want it easily and fast;
“We were aware of what was happening in the world — we had just two options: do nothing and let the customers get what they wanted somewhere else or unify their online and offline experience and take advantage of the situation”
by Niklas Grunewald, Vice President Innovation at Deutsche Bank
Nowadays, millenials set the new market rules: they need authentic and tailored solutions.
If you are able to satisfy their requirements, you will excel in an environment where customization sets the mark between a successfull company and a fail.
To keep up with this cultural change and social digitalization, banks, as any other institution, have no other choice but to disrupt their obsolete models by focusing on their customers’ journey.
In fact, a well prepared customer journey is able to reveal the obstacles in the clients’ path and give the possibility to study, improve and ease up the customers’ touch points.
.1 FINTECH AND MILLENIALS
THE 1st TAKEAWAY
The best practice to meet millenials’ expectations and significantly increase their Lifetime Customer Value is by:
- ideating services to satisfy their specific needs
- crafting and customizing emotional experiences to fall in love with
- creating products which are easy to use: they don’t have time to “waste” doing one thing — save them time and they will be happy to pay you for that.
Berlin is one of the leaders of the digital transformation:
“the city is considered to be the n.1 city in the world for providing the best environment for Millennials. And where there’s Millennials there must be room for innovation. For the banking system it was a nightmare!”
by Niklas Grunewald, Vice President Innovation at Deutsche Bank
A nightmare? Yes, that’s how they defined it at the Deutsche Bank Innovation Lab.
Nowadays, banks have to undertake one of the biggest challenges they have faced so far, a social evolution which strength is able to disrupt the models of even the most stagnating sectors of the economy.
And the leaders of this social evolution are Millennials.
Millennials who recognize the importance of taking care of their own finance, can’t see their generation reflected in the retail banking system yet and they don’t see their needs satisfied in most of their products.
However, they are not limited by any of that as they are overwhelmed by tools and plaforms from various sources that they can easily integrate to their daily finance management.
“We have so many options that a good a product is not enough anymore”.
Millennials use tools which are conveniente and have a great interface and we chose brands which are transparent and cool.
Companies have now few years to adapt to the requirement of the youngest and decide if they are going to consider these “tools and platforms” as retail banks’ partners or competitors.
We can consider the approach of Niklas Grunewald and his team of great inspiration:
“We understood we shouldn’t fear innovation, but we should find the ups in this digital transformation.
Therefore, we came out with the belief fintech platforms are competitors but fintech startups are our best partners: being the first one who offers a new service to our customers is a great advantage across competitors.
We have a big customer base and strong credibility and we should be able to use this as a weapon and start functioning as a marketplace. Millenials crave that”.
At that time we were working on the Fintech Cloud Accelerator and the Internet banking app for the Czech Banking Group Česká Spořitelna.
We kept in mind the goal of being attractive and fresh.
We designed on the requirements of the test users and we came out with a product with global potential and perfect usability, which will soon be launched on the Czech market.
.2 FINTECH AND HCD
THE 2nd TAKEAWAY
It is important to create taylored solution to people needs:
the way to give us, Millennials, what we want is through Human Centred Design (HCD), a hot topic for every B2C sector.
Hear is the first chapter of the HCD process and the way for designing products for people.
In the process of creating the Fintech Cloud and while crossing it with the internet banking application, we knew we had to adapt each strategy to the new era guidelines for funneling innovation in the banking system.
We knew we had to start with these pillars:
- offer a superior UX and UI
- rely on the trust only an institution with a long history can offer
- guarantee customers can have everything they need in one place.
Banking institutions should recognize there is room for improvement only when they are able to reverse the way they were used to operate:
“it’s not anymore about creating products and services which are going to be sold to people, but the goal is understanding what the people want, and only then crafting it for them.”
by Dalibor Pulkert from Outboxers
Experience at Outboxers Innovation Lab has taught us there is no other way how to pursue this goal than to fully dive into field researches, ideally when conducted by a psychologist who is able to unreveal the hidden meaning of people behaviour.
In fact, many times it is not even a matter of the best idea or technology, but a process where empathy can help to connect the dots: the secret is asking the right questions and treating every voice with the same power.
“Most of the times, when you make people understand their problem, either with proper questions or with a tangible prototype, people will tell you what they want and will solve the problem for you. Sometimes, they don’t know what they want or they can’’ explain it”
by Michal Kardaš from Outboxers
.3 FINTECH IN THE BRANCHES
THE 3rd TAKEAWAY
Educating retail employees to break the hierarchical institutions and embrace a more horizontal approach of the workflow, is fundamental.
Branch employees are the closest touch points with end customers and they have to be trained to reflect the innovation a company is working on.
A very important but often underestimated segment in the innovation process in a company is education of the employees: the friction between hierarchy and formality within the branches limits innovation.
Nowadays there is no other choice than to be dynamic: the cultural transformation we are experiencing is a game changer for companies, especially in a corporate environment where switching the work flow, perception and believes is a very complicated challenge.
Employees should be ready and prepared to trust and propose innovative solutions to their customers, embracing the unification of different departments and softening the barriers between them.
“It’s an important moment for the client if he is able to be shown something he hasn’t seen before.”
by Niklas Grunewald, Vice President Innovation at Deutsche Bank
IN SUMMARY…
- Customers are more and more digitally spoiled and banks have to disrupt their operating models to meet clients expectations.
- The cultural change is led by Millennials whose needs and choices are “extraordinary”. Creating new products around their expectations is the way to a win-win cooperation.
- Human centered design (HCD) and education are the secret ingredients to craft products and experiences tailored on the new market needs — a great reminder is the continuous integration of online and offline innovative solutions.
Elisabeth Ben Thabetova, Business Designer and Innovation Lead at Outboxers
