Macquarie Equities warning to the Big Four banks last year appears to have hit the mark; at least at Westpac. In a briefing with analysts yesterday Westpac CEO, Brian Hartzer, revealed a sharp focus on using digital technologies to provide better customer experiences, drive growth and limit costs.
However critics might suggest his view that the bank could not afford to become obessed with tech at the expense of customer service could indicate that Westpac’s leadership still has some catching up to do when it comes to the realities of the modern Millenial. (Here’s a hint Brian, these days tech and customer service are kind of the same thing.)
To wit;
- One in four Millennials have abandoned bank branches altogether: study
- Adios baby! Banks are redundant in the digital age according to Millennials
- Just make it simple, Millennials tell bankers
- Four myths retail banks should ignore in the digital age
Still, every journey starts with that first step.
According to the bank chief, “Banking is undergoing a transformational change.”
He said, the bank was now accelerating the execution of its plans to build what he described as one of the world’s great service companies over the next three years.
“We are increasing our annual investment by around $200m to $1.3 billion directed towards growth, service and efficiency initiatives. This means concentrating our spend on technology, on digital, on simplification, as we hone our focus on service.
“By investing in digital, we can use technology to redesign the customer experience, making things simpler, easier and better for our customers and our people. “This includes the development of a Customer Service Hub to give the Group one view of the customer and the ability to look at their needs and opportunities across the entire banking and wealth spectrum.
Hartzer said there would be continued investment in the banks brands, including the roll out of the Group’s new look branches, and that these will represent more than half of the network by 2018. It’s worth noting also that there will be fewer branches, and they will be smaller, cutting costs further, although hartzer declined to offer specific numbers.
He also said the increased investment will be supported by a complementary efficiency program, which will reduce the Group’s expense growth run-rate to two to three per cent per annum, he said.
Ealier this year McKinsey & Company warned that banks have three to five years to get their digital act together before they enter a spiral of decline while at the same time chairman and CEO of Spanish bank BBVA Francisco Gonzalez, told media and analysts that up to half the world’s banks could slip through the cracks as digital transformation takes hold.
This article originally appeared at B&T’s sister digital business site www.which-50.com
