Question

End User Application [20 marks]

Case study

The retail branch bank faces stiff competition, based on the popularity of online and mobile banking, and on the threat of new entrants to the payment business, like Apple Pay, Samsung Pay, Google, and Facebook. Despite this pressure, the retail branch remains a fundamental driver of revenue. According to the Accenture Retail Banking Survey, the branch is where nearly 60% of traditional retail bank products are sold, and customers still prefer the branch to a website, by a narrowing 41% to 35%. Although branches are still preferred by customers, they’re expensive to operate. The Accenture survey says that simple, low margin transactions, such as check deposits or cash withdrawals, are 95% cheaper when done digitally vs. using a teller. Mobile payments are 65% cheaper than paying by check. New branches are also expensive to open – $2M on average. Financial services companies are evolving the branch to better align margins with costs. So, a full service branch may use self-service kiosks and ATM machines for low margin services, while they use video-chat or remotely delivered consulting services for more complex, specialized transactions like establishing college fund accounts. They devote their expensive advisors to high margin services like mortgage applications and general retirement account set-ups. To support this evolution, IT must monitor all of the critical relevant business activities executed in the bank branch, whether a single step, like ‘edit customer account,’ or a more complex workflow, like ‘process a mortgage re-fi.’ Monitoring the response time of these activities relative to SLA targets ensures both workforce productivity and customer satisfaction. Monitoring the volumes of these activities enables branch leadership to determine whether the goal of aligning margin of services to cost of operation is being met.

Question

End-user applications development poses a new set of management problems in companies that adopt this approach. Identify the nature of these problems and suggest measures to overcome them.

Answer 1

In this modern world, everybody need fast and non complex services. Due to introduction of Mobile Banking, there are many problems arises for Branch Banking, which are as under:

1) Increasing competition: We are in 2020. There are now many Bank branches and Online services are available for   customers. Hence customer are diverting as per their convenience. They look for more affordable, closer and cheaper services for themselves. It decreases the bank customer base and their profit margins as well.

2) High Administration cost: In branch bank, their administrator cost is higher than online banking. The man power used in Branch bank is much more than online banking. It leads high expenditure for branch bank and lower the profit in revenues for the banks.

3) Rising Expectations: Today's customer are more smarter, savvier and more informed. They need high quality services without wasting much time. It increases more demand of Online banking.

4) Continuous Innovation: Most of the branch banks works on the old traditional model. It decreases the interest of the customers in this banking. at the other side, online banking works on continuous innovation. They are more live with customers and readily available as and when they required.

Even we have many problems in branch banking but it is not like we can not overcome these problems. We need to work on some areas and then we can compete them well. Here is some solutions to overcome this problem:

1) More use of Data Analytics: Branch bank should work on the customers expectation. They should know that what exactly customer want? Accordingly they can introduce their products. To know customers needs, bank should use their old data. They should study this data with the help of data analytics to understand customer needs.

2) Single window system: Modern days customer do not have much time. They need solution at one place. They are more smarter, savvier and more informed. If bank will solve their problem at one place instead of telling them to go and do different things. Definately, customer will not go no where. Fastening the process will help banks to bind the customer with them.

3) Customer safety and security: The most important service, which every customer needs from his bank is Safety and Security. If we provide them good services along with safety and services. For sure, customers will never go to other place.

4) Priority Customer services and Gifts: Priority customer services increase the trust and confidence of the customer. It makes customer busy to transact with bank. The customer should feel that he is the priority for the bank. The Gift services also help to take emotional side of the customers.