Design Thinking: A Fresh Take on Digital Transformation
By Steven Lenaerts, Head of Product Management, Global Channels, BNP Paribas Cash Management and Stephanie Niemi, Deputy Head of Product Management, Global Channels, BNP Paribas Cash Management
Treasurers are making huge efforts to embrace digitisation, but they cannot do it alone. As such, they are turning to their relationship banks for smart solutions which provide maximum efficiency, with minimum commotion. In turn, banks are leveraging fintech collaborations and client co-creation sessions to deliver cutting-edge offerings. But is this enough to enable true digital transformation for treasury?
For many treasurers, developments in technology and innovations being enabled by Open Banking are giving rise to new opportunities for digital transformation. This means different things to different companies – after all, every organisation or business will have its own challenges and pain points. But treasuries that do embark on digital transformation will nevertheless have plenty of themes in common.
Likewise, as more companies seek improvement through digitisation, it is increasingly important for banks to keep up with their clients’ evolving priorities and requirements. In particular, there is a clear need for banks to recognise the importance of a smooth user experience for corporate clients.
First things first
When undertaking digital transformation, treasurers seek to move from a starting point, typically characterised by inefficient, manual and time-consuming processes, to a more productive end state. Along the way, treasurers will aim to adopt more streamlined processes and achieve more visibility over their cash balances and transactions, while reducing unnecessary costs and freeing up valuable time for strategic decision-making. They will also want to make sure those decisions are supported by accurate, up-to-the-minute information from a variety of sources.
With more companies seeking to transform their treasury operations through digitisation, banks are likewise focusing on taking advantage of technology more effectively than in the past. They are also taking steps to improve their connectivity solutions as they aim to enhance and expand their corporate customers’ digital experiences.
Rising to the challenge
In the current environment, treasurers increasingly expect their banks to step up and move beyond the traditional parameters of bank relationships. So instead of relying on approaches that have served them well in the past, it is essential that banks take a more client-centric approach – while seeing what lessons they can glean from the most successful fintechs.
It is no secret that fintechs have played an important role in driving innovation. Unhindered by legacy platforms, fintechs are characterised by innovation and agility. They also tend to have a strong focus on user experience, in contrast to the approach historically taken by many banks. As a result, banks have much to learn from fintechs about harnessing technology effectively while pinpointing new approaches to existing challenges.
The good news is that banks are rising to the challenge by paying more attention to the importance of user experience. One area that is particularly ripe for improvement is that of user onboarding: with companies increasingly expecting a smooth and straightforward process, there is much that banks can do to streamline previously time-consuming activities. In the case of Connexis Cash, BNP Paribas has built an end-to-end digital user onboarding process, spanning activities such as creating new users, providing a digitalised process for activating and distributing digital tokens, and streamlining entitlements management.
That said, irrespective of the degree of digitisation achieved, at this stage there are a number of processes relating to bank connectivity – such as the management of connectivity contracts – that are yet to fully benefit from digitisation. When addressing these processes, it is important that a complete rethink and simplification of the process is undertaken in order to drive real benefits. In other cases, where legacy platforms hold back digitisation, technologies such as robotic process automation (RPA) can be leveraged to automate processes.
Also important is the need for banks to improve upon and complement existing connectivity solutions. With Open Banking transforming the payments ecosystem and paving the way for new digital banking services, traditional solutions are increasingly being complemented by application programming interface (API) connectivity.
As banks strive to help their corporate clients achieve their goals through digital transformation, they are also making other changes, such as reinventing the way to conceive their solutions. BNP Paribas, for example, is increasingly becoming more agile so that we can reduce the time to market for new solutions and avoid a ‘tunnel’ effect, in which products are developed without involving the customers they are meant to serve.