Published: June 01, 2012
Even during a prolonged period of economic fragility, every organisation’s ambition is to grow more quickly and more sustainably than its competitors. At J.P. Morgan, we share the same objective. We aim to achieve this by anticipating, delivering and supporting the solutions and services that our customers require as they expand into new markets and customer communities. Pivotal to achieving growth is both operational and financial efficiency, and risk mitigation. These are the central tenets of our strategy, both in the way that we deliver our solutions and services, and the benefits that these offer to our customers.
One important way in which our customers are aiming to enhance their operational efficiency is through greater standardisation of systems, processes and formats. Bank integration is a key element of this. We are helping our customers to plan their bank connectivity to enable streamlined processing based on secure data exchange and standardised formats. One method of achieving this is to use SWIFTNet, formerly the bank-to-bank communication network, through which non-financial corporations are also entitled to exchange financial messaging. By leveraging a non-proprietary network across all their banks, corporates manage their connectivity risk more effectively than using multiple electronic banking or host-to-host systems provided by individual banks. A key benefit is that there is no need to change bank connection in the event of changing or adding banking partners. A single channel also makes it easier to standardise processes and formats, and avoid fragmentation of information. SWIFTNet offers maximum security and resilience, which are vital considerations in managing operational risk.
Using a bank-agnostic, robust single channel for communicating with banking partners enables corporate treasurers and finance managers to focus on the information itself, as opposed to how it is transmitted and received.
At J.P. Morgan, we are active in supporting customers to use data more efficiently, both to automate processes such as reconciliation and account posting, and facilitate better-informed decision-making. For example, a valuable advantage of working with us is the ability to access several advanced workflow tools. These not only deliver information on flows and transactions with J.P. Morgan, but more widely across the J.P. Morgan Network, i.e., our partner banks with whom we provide a comprehensive global service.
The decision to embrace multiple channels for exchanging information is an important strategic decision for a bank, as traditionally, each channel was considered a product. We recognise that a key element of our success in meeting the needs of our large, complex multinational customers is to support the diversity of channels they require, including SWIFT, web-based electronic banking systems and host-to-host connections. Messages and transactions may not necessarily be approved through the same channel as they are initiated, so a flexible, channel-neutral approach is essential to meet customers’ specific needs as they expand globally. Security, convenience and interoperability are key requirements, and these are all areas on which we are focused to maximise confidence and trust in our solutions.
The strategic decision to be channel-neutral in the way that we communicate with our customers also has an impact on the way in which we embrace newer industry initiatives such as eBAM (electronic bank account management). eBAM has considerable potential to improve and streamline processes, and enhance risk management for both our customers and the bank. We are seeking to ensure that however a customer communicates with us, they are able to access the same capabilities and benefits.
Some technology in which we invest is targeted at promoting financial and operational efficiency in the workplace, but finance executives also need to be efficient when they’re on the road. This was the motivation behind the development of J.P. Morgan ACCESS Mobile, a smartphone and tablet tool that enables rapid, convenient access to a wide range of information, actions and analytics. Just as internet banking first became popular for retail banking before it emerged as a valuable tool for wholesale banking, we have seen a huge growth trajectory in the use of mobile technology for retail banking which we expect to see replicated in the wholesale banking community in due course. This is likely to happen far more quickly than the slower, more gradual progress we saw towards internet adoption, due to the experience that has been built up in developing confidence in security and controls, as well as providing convenience and usability.[[[PAGE]]]
Barriers to adoption offset more innovation than just in relation to mobile technology. Not only are we investing heavily in developing new technology to benefit our customers, but we are also focused on easing the adoption process as far as we can. Treasurers and finance managers have a wide range of issues on which to focus, and however attractive a new tool or capability might be, it can be difficult to prioritise acceptance, particularly if this requires a change of processes or additional costs. This process of making adoption as easy as possible is an ongoing process, involving close collaboration with our customers, from which we can see that J.P. Morgan, and our customers alike, are benefiting. For example, we are finding that adoption of our workflow and decision support tools is growing rapidly, as we have tried to minimise the need to modify existing technology.
One such solution is a global receivables tool - Receivables Edge – which has already been rolled out across Asia and North America, and has now been introduced in Europe. This is a rule-based engine that sits between the bank’s system and the customer’s reconciliation system to filter inbound collections and identify exceptions. This enables reconciliation rules to be enhanced and maximises automatic reconciliation.
Efficiency for treasurers and finance managers does not only involve streamlined processes and interoperable, highly functional systems. Companies also need to be able to rely on their banks globally, either to deliver services directly or work closely with partner banks to deliver highly integrated services and information flows.
At J.P. Morgan, not only do we continue to invest heavily in building and enhancing our Network of partner banks, but we are also expanding our direct presence strongly in core regions. For example, we have experienced double digit growth, exceeding that of competitor banks, across parts of Europe over the past 18 months based on investments made in 2009-2010. Even in economically flat markets such as the United States, we are seeing highly competitive growth rates. As well as growing in EMEA and Asia Pacific, we have established a strong footprint in Latin America, including Mexico and Brazil, enabling us both to service the expanding needs of our existing customer base and attract new customers.
We have made a considerable investment in Russia, which is proving very important to our customers, despite the complexities of the market. We also opened branches in Saudi Arabia, South Africa and Central & Eastern Europe. As sub-Saharan Africa starts to flourish, we are helping our customers to leverage their potential in the region. The investments we have made in China and India over a number of years are proving extremely fruitful, with customers leveraging our solution strength and local expertise to support their trade and cash management objectives.
Working with our customers in a seamless way is not an ambition restricted to our technology or geographic presence. Furthermore, the variety of solutions we offer, and the countries in which we offer them, is not the way that we measure our success. We recognise that pivotal to a successful relationship with our customers is the quality of the customer experience, both directly with J.P. Morgan and across the J.P. Morgan Network. Our dedicated team is focused on the efficient delivery of customer service excellence, based on a centralised view of each customer, with central and local support as required in each instance. We constantly review our customer satisfaction, which is already recognised through numerous awards, with a view to continuous improvement and refinement.
With the right solutions, that promote and enable efficiency for our customers, in the right regions, and with a high level of customer satisfaction, we know we will have achieved an Oscar-winning performance.
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