Working Toward an Omnichannel Banking Environment

by Edward O'Brien 0

As most banks, thrifts, and other financialinstitutions are in the midst of strategy planning season, nowwould be a good time to evaluate an emerging trend gaining tractionat many institutions: omnichannel banking.

Omnichannel banking transcends traditional banking, and is inresponse to financial institutions’ need to extend their reachbeyond DDA accounts to all accounts – and all customers -throughout their various lines of business. The result is abusiness model that extends beyond traditional core banking andmultichannel systems toward a more holistic omnichannelinfrastructure.

This new view of banking is needed because today’s financialinstitutions are looking to extend their capabilities beyondtraditional mainframe-based core systems with a primary mission ofmanaging checking and savings transactions, and integrating coreoperations more deeply with their other financial and back-officesystems. Among the bank-led initiatives are projects to tietogether various legacy systems that have evolved over the years aspart of organic growth or mergers and acquisitions.

These organizations, as well as their financial institutioncustomers, are also working toward greater integration of theirsystems and other channels, marketing, customer relationshipmanagement (CRM), back office, and analytics systems towardsomething called omnichannel banking.

Although the desire to offer outstanding customer service iscentral to most financial institutions’ mission statements, theability to execute on such plans has been limited. Only recentlyhas the underlying technology of banking systems begun to enabletruly interconnected systems.

Furthermore, many of the large core system providers are in theprocess of planning or implementing enhancements to their solutionsto increase their interoperability with various customer accountsand back-office systems to improve overall customerexperience.

To execute on this new, omnichannel banking paradigm, manyfinancial institutions are thoroughly evaluating their processesand systems and seeking new methods to better understand andconnect with customers. This evaluation usually requires a thoroughreview of the way the financial institution’s core, channel, CRM,and back-office systems work before the institution can determinehow to make them work together more effectively and efficientlyprovide a 360-degree, real-time view of the customer.

Central to this strategy is the need for broad interoperabilityacross products, systems, and lines of business. This allowsvisibility into key information residing across diverse solutions,something not easily achievable-and in many cases not possible-inthe past.

With such capabilities, financial institutions will be embarkingon an extended journey toward superior customer interaction andengagement, with a 360-degree view of customers’ wants, needs, andbehaviors, and new ways to differentiate their products andservices for years to come.

Follow Ed O’Brien on Twitter @ed_ob. Visit the Banking Channels Strategy Session onPaymentsJournal.

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