ORLANDO, Fla., Nov. 15, 2005 — Today at the 28th Annual Bank Administration Institute (BAI) Retail Delivery Conference & Expo, a banking industry gathering held Nov. 15-18 in Orlando, Microsoft announced continued momentum for its “experience Banking” initiative.
Warren Lewis, Managing Director of Banking, Microsoft Financial Services Group
To learn more about the success that banks and industry partners are having with “experience Banking,” how the initiative benefits customers and why Microsoft is dedicated to this industry, PressPass spoke with Warren Lewis, managing director of banking in Microsoft’s Financial Services Group. Lewis leads Microsoft’s banking industry business strategy in the United States, which is focused on delivering optimal value for customers and strong business results for Microsoft and our industry partners.
PressPass: What is Microsoft announcing at this years’ BAI Retail Delivery Conference & Expo?
Lewis: Microsoft is announcing the continued momentum and success that banks across the globe and our leading industry partners have reported to us due to the “experience Banking” initiative that was launched one year ago, also at BAI.
Momentum for “experience Banking” is fueled by the continued adoption of Microsoft technologies by leading banks across the globe, including Banco Azteca, Banco Nossa Caixa, Barclays Bank, BMO Financial Group, CheckFree Corporation, Farm Credit Services of America, Monte dei Paschi di Siena, Standard Chartered Bank and Woodforest National Bank. Recent product launches, including Microsoft SQL Server 2005, Microsoft Visual Studio 2005 and the upcoming Microsoft BizTalk Server 2006 – which introduce a host of new enterprise-ready features for banks’ and other financial institutions’ back offices; upcoming problem solving solutions, such as Microsoft Motion; new industry partners from Accenture, Advanced Financial Solutions Inc. (AFS), a Metavante Company, Baker Hill, Getronics, Harland, Intel and Intervoice, and the continued support of leading banking industry partners.
PressPass: What is “experience Banking?“
Lewis: It’s an initiative designed to help banks deliver greater shareholder value and brand differentiation. Working with their technology partners, Microsoft will help banks and other financial institutions to change their customer experience. A critical element of this is the need to change the employee experience and the operations experience as part of the three-pronged approach toward building a unique brand position in the market
PressPass: Specifically, what are the benefits that the customers you mentioned are experiencing?Lewis: Leading banks across the globe continue to adopt Microsoft technologies and are experiencing significant benefits that include lower total cost of ownership (TCO), increased return on investment, faster time to market, more-streamlined operations and enhanced customer service. Specific examples include:
Barclays Bank, the world’s ninth-largest bank, promised its shareholders cost reductions of ₤1 billion (US$1.8 billion). The company sought a technology solution that streamlined business processes and improved communication without compromising large quantities of highly sensitive information. Barclays Bank chose to standardize its desktops with the help of EDS and HP, using Microsoft software and by adopting the Microsoft Office System. The resulting benefits are seamless integration with back-end enterprise servers so that employees can quickly respond to customer requests. Improved collaboration on data and documents will also help speed up business decisions.
CheckFree Corporation, based in Atlanta, is a leader in financial electronic commerce, including electronic billing and payment, financial services software and outsourced investment services. CheckFree selected the Microsoft platform to decrease costs while meeting its high volume needs and stringent quality demands. Significant benefits of using the Microsoft platform include a 24-percent lower total cost of ownership, 14-percent faster transaction rates and faster time-to-market when compared to a Linux-based approach.
Standard Chartered Bank has more than 30,000 employees in more than 500 locations in more than 50 countries through the Asia Pacific region, South Asia, the Middle East, Africa, the United Kingdom and the Americas. Standard Chartered Bank wanted an instant messaging solution to enable real-time communication and collaboration. It adopted the Parlano MindAlign enterprise messaging application, running on Microsoft Windows Server System. The company is now experiencing revenue boosts of 5 percent, increases in productivity up to 500 percent, total cost of ownership reductions and greater agility to respond to market opportunities.
Woodforest National Bank, one of the top-earning banks in the United States, developed a multilingual telephone banking system using Microsoft Speech Server 2004. Call times are now expected to be reduced by 50 percent. Live operator support has been reduced by up to 70 percent.
PressPass: What is the biggest concern for U.S. banks?
Lewis: Competition in banking has never been fiercer. With the competition just a mouse click or a street corner away, banks may experience customer attrition rates of 15 percent or higher. Consumers have come to expect seamless customer experiences no matter how they access the bank – at the branch or an ATM, through a call center or via the Internet. They want prompt response to service questions, thorough advice on financial solutions, products and services that can be tailored for their particular need and seamless, error-free transactions. Failure to meet customer expectations can result in a customer opening an account across the street. According to the American Bankers Association, a bank’s average cost for acquiring a new customer in the United States is $3,500. With such a high cost of acquisition, no one can afford to lose a customer.
PressPass: How can banks best position themselves to compete over the next decade?
Lewis: Banks can position themselves to compete over the next decade by turning to technology to find new value in existing systems, explore new market opportunities and realize measurable returns on their investments. Technology by itself is not the whole solution. The greatest impact on any business is people, enabled by effective solutions that deliver results. At Microsoft, we are working to make great software that helps banks realize their full potential and create maximum competitive advantage. Our software helps banks succeed by providing people the tools they need to gain new insights, make informed decisions, and achieve results.
PressPass: How can Microsoft and your partners help the banks build successful retail franchises?
Lewis: An important first step is recognizing that they are in the “experience” business, and that their customers judge their banking experience against non-bank providers. For example, the bank’s Web banking site will be benchmarked against successful e-commerce sites and not against another banking site. The degree of personalization, ease of use and responsiveness will be compared. When it comes to problem resolution, the customers will judge their bank against retailers known for empowered employees and prompt problem resolution. This means that bank employees in the branch and call center must be skilled and provided with the right tools that allow them to resolve customer problems in the same fashion in order to create a positive customer experience.
PressPass: What factors did you consider when you developed the “experience Banking” initiative?
Lewis: We took a broad look at what matters most to our financial services customers – what goals and objectives they have, long-term opportunities as well as more immediate, market-driven realities. As markets cycle, customers are being forced to look at their businesses in a different way. Increasing regulatory compliance pressures, distribution-channel optimization, market segmentation, product refinement and customization all create tremendous pressure to improve. Microsoft is responding to these pressures by aligning our solutions, partners and capabilities around those challenges so that our banking customers can get full value from their investment in our technology, reduce the cost of operations and compete more effectively in the marketplace. When customers take advantage of these capabilities, the ‘experiences’ achieved can yield tremendous and much-needed differentiation.
PressPass: What role are Microsoft’s industry partners playing in “experience Banking?”
Lewis: Partners are central to the Microsoft strategy. Partners use Microsoft software technologies to create innovative applications that deliver changed “experiences” to the customers, employees and operations.
PressPass: How committed is Microsoft to the banking industry?
Lewis: Because of banks, individuals and business able to manage money in a smart, safe and convenient way – whether that be online, by phone, mail, ATM or traditional brick-and mortar branch. With so many channels of distribution, there is room for error. It takes one bad experience with any of those channels to give a customer a negative perception. Due to this, banks are facing the toughest competition ever and they are constantly looking for ways to compete in the marketplace.
Microsoft understands this and is strongly committed to helping all banks – large and small – compete. Over the years we have increased the number of people, partners and investments made for the banking industry in order to secure a successful future for our business relationships and our customers.
In April, Microsoft announced that it would be restructuring its U.S. enterprise sales and services organization to become more industry-centric, that it would be making further investments and adding 10- to 20-percent more resources to its U.S. enterprise sales an services organization and would be elevating the role of our industry leadership within Microsoft management.
PressPass: Does Microsoft plan to compete with banks or industry partners?
Lewis: Microsoft has no plans to compete with banks or our industry partners. As I mentioned previously, Microsoft’s industry partners are central to the Microsoft’s vision is to help banks not compete with them.