With more to do and with fewer resources available, treasury professionals increasingly lack the time and patience to deal with clunky and inefficient banking services and systems, and are calling for a better user experience. But are the banks listening and what comprises a ‘good’ user experience? Treasury Today finds out.
Apple founder Steve Jobs had a simple philosophy towards product design: start with the customer experience and work back toward the technology – not the other way around. It is a philosophy that continues to influence every product that the company produces and is arguably one of the biggest factors in Apple’s success.
Although simple, Jobs’ philosophy was pioneering. Until then, companies had typically designed products they thought people needed with very little customer input until the very late stages of production. Jobs’ thinking not only brought success but also inspired a whole new generation of innovators who have looked to follow Jobs’ example, designing products and solutions that provide an excellent user experience.
In perspective: user experience
User experience is a very broad concept and definitions will vary depending on who you speak to. The Nielsen Norman Group provides a succinct summary: “User experience encompasses all aspects of the end user’s interaction with the company, its services, and its products.”
Alberts Pumpurs, Partner at the UX Design Agency, expands on this definition, saying that companies who provide a good user experience are those that enable “the customer to meet its objectives in a straightforward and efficient manner”. To provide an example, Uber has revolutionised the taxi business, not only by allowing anyone to be a driver but by enabling customers to easily order a taxi, track its progress and pay for it automatically at the end of the ride. The user experience provided by Uber is better than calling a taxi office and waiting for the car without any knowledge about its status.
Companies that provide a great user experience will typically also offer an intuitive user interface – the platform with which the customer interacts. Uber’s app is intuitive and clearly provides its users with all the information they require.
User experience is not a modern concept. Pumpurs explains that companies have “unconsciously” always been looking to improve user experience, typically through the development of better user interfaces. The science behind it, however, only began to take shape in the 1950s with the publication of American industrial designer, Henry Dreyfuss’ book, Designing for People. In his book, Dreyfuss wrote: “When the point of contact between the product and the people becomes a point of friction, then the industrial designer has failed.” But only in the past 20 years have these concepts attained a new impetus.
Indeed, for Pumpurs, the need for all businesses to focus on user experience has only become more important with digital start-ups embracing these concepts and challenging ‘traditional’ companies. “To make themselves stand out in a well-entrenched and highly competitive market they have to make their services useful, intuitive and fast,” he says.
This is especially true in finance, where the proliferation of fintech has saturated an already well-populated market. In the payments space (which we look at in more detail in the Insight & Analysis article), for instance, well-known fintechs such as PayPal and Alipay now offer their users the ability to make payments quickly and easily. With Alipay and PayPal’s registered users numbering 400m and 197m respectively, these services are significantly disintermediating financial incumbents. In response, banks have invested heavily in their own user experience in an effort to retain and deepen their customer relationships – especially in the retail space.
The corporate view
But what about in the corporate space? Are banks and treasury technology vendors keeping up with the pace of change? The corporate treasurers consulted by Treasury Today suggest that there has been some improvement, but that there is also still some way to go.
Damian Glendinning, Treasurer of Lenovo, called out the banking community on the user experience it offers when speaking at a panel moderated by Treasury Today at Sibos in 2015. Glendinning pointed out that he used a better online banking portal as a consumer than he did as the corporate treasurer of a multinational corporation.
This point was recently seconded by Cale Bennett, Group Treasurer at Tatts. “In Australia, the user experience offered by the banks in the consumer space is fantastic,” he says. “But very little of this development has flowed through to the institutional space yet.”
In the United States, Guillermo Gualino, Vice President and Treasurer at Agilent Technologies, has similar comments. “In general, corporate banking systems are not easy to use,” he says. “I believe this is because each bank wants to be ahead of the competition so they will over-feature their online portals in an effort to stay ahead, with little thought about the user experience. As a result, they become more complicated and thus less attractive to use, despite the new functionality.”
Referencing Microsoft founder Bill Gates, who said in 1994 that in the future people will need banking and not banks, Gualino says that banking portals are simply a tool used by treasurers to do something. “We want to get in, make the trade and then get out again,” he says. “It should be simple and efficient – and if it looks nice as well then that is a bonus.”
There are a variety of reasons why the user experience provided by commercial banks is lagging behind the retail space. As Susan Feinberg, Senior Analyst at Celent, who recently conducted a study in this area, explains: “Commercial banking is far more complex with much more functionality that needs to be delivered. Commercial banks have therefore traditionally been much more focused on functionality rather than user experience.”
As previously mentioned, the rise of fintech has highlighted how banks could provide a better user experience. But Morgan McKenney, Head of Core Cash Management at Citi, says that that size of balances and the value of transactions in banking for corporates mean that security is paramount. “Although treasurers are calling for a better experience when working with banks, they are still primarily concerned with the security of the firm’s money and information,” she says. “To offer both security and world-class user experiences each requires a lot of time and resources, which may mean rebalancing priorities sometimes.”
Banks are also hamstrung by myriad legacy technology, further impeding their ability to improve user experience rapidly. “Commercial banks offer a vast number of products,” says James Haycock, Managing Director at Adaptive Lab. “Over time as new products have been introduced or existing ones have evolved the systems have become increasingly complex. Just keeping up with compliance related changes consumes the vast proportion of budgets and that’s before any investments in innovation.”
It is not just legacy technology that Haycock sees impeding the banks. “While banks are experiencing greater cost pressure, most remain profitable so there’s not a great incentive to change. This means many are doing things the way they always have. They’re very product centric rather than customer centric for one. I think this surfaces itself in how they go about improving or designing products with design still often seen as an activity taking place later in the process rather than from the beginning where it can have the greatest impact.”
Haycock believes the operating model of banks further impedes innovation. “Banks operate in silos: which is evident when you call them or in the digital experience you have,” he says. “Digital is still seen by many as a channel when actually it’s a lot more than that. Until banks more seriously reconsider their approach to the design, delivery and improvement of experiences this problem will continue to be exacerbated.”
Innovation in action
Indeed, it is realigning the bank’s different business lines and removing silos behind the scenes that is perhaps key in their efforts to offer a greater experience to their clients. As Citi’s McKenney details: “Providing a great experience to our clients goes way beyond developing a digital platform that is easy for treasurers to use. It is also about looking at the end-to-end process flow within the bank and how efficient this is. You may have a great looking internet portal, but our clients ultimately are impacted by a bank’s full end-to-end processes.
McKenney explains that in essence every step the bank takes is designed to improve the user experience it offers its clients. Such steps include removing paper from processes, providing single access to applications and simply making the answers to frequently asked questions available online – saving clients the time and effort involved in contacting a call centre. “These may sound like small changes and fairly straightforward, but the bank has had to take a conscious effort to take these steps,” she says.
Spotlight on TMSs
Banking portals are, of course, not the only treasury technology used by corporate treasury professionals. For many, a treasury management system (TMS) is the dominant tool. Here Bob Stark, VP of Strategy, Kyriba talks about the user experience in the TMS space.
“Corporate clients want easy-to-use software that doesn’t require a user manual to figure it out,” says Stark. In his view, this is important for two reasons. “Firstly, a unique characteristic of TMSs, compared to other types of software applications, is that the core TMS users are using the software the entire day.”
Stark also notes that TMSs also have a large number of users that log in infrequently – perhaps once or twice a month. “This presents a different set of challenges,” he says. “The system not only needs to be easy to navigate, but it also needs to be intuitive and tailored to their exact needs so they’re not fighting to remember how things work given their infrequent usage.”
Fit for purpose?
Unfortunately, TMS providers haven’t always been the best at providing a good experience to their clients. “There are too many poorly designed treasury management systems in the market that have passed into obsolescence,” says Stark. “The problem in this space is that some vendors are unable or unwilling to evolve their treasury software.”
The consolidation of the market is noted as a key reason for this. “We see this most often with treasury systems that have been acquired, or with those vendors that are looking for an exit strategy,” adds Stark.
In conversations with its clients, Kyriba has found that offering personalisation is crucial to delivering a good experience, enabling treasurers to organise their treasury workflow. “Our system allows users to build maps guiding what they want to do in the system and how to navigate to those screens, reports, and processes with a single touchpoint,” notes Stark. “This is important because of the balance needed to support core users and less frequent users of the system.”
Citi is, of course, also focusing on the front end. “If we do all this work in the back end and then offer our clients a clunky and complicated online and mobile banking portal then we will still not provide a good experience,” says McKenney. The bank has therefore employed user experience professionals in its innovation labs to work with clients for their feedback to design intuitive online experiences.
“When we redesigned our online portal, we brought in clients and used eye tracking software to understand how they interacted with our products in great detail,” she says. “This insight has enabled us to design our products to be as intuitive as possible for our clients.”
Customisation is also important and Mckenney notes how the bank has built its online portals using widgets (micro apps that can be moved around the screen) to allow individual users to get the information they need quickly. “In doing this, accessing an account balance that might have taken ten clicks is now available straight away on the homepage.”
An important future
Citi is just one of many banks looking at this area. As development continues, user experience may become a key differentiator for corporates – especially as banking products become more commoditised. “We are already seeing retail customers switch banks to those that offer a superior user experience and why should a treasurer have an experience sub-par to what they’re used to in every other aspect of their job,” says Adaptive Lab’s Haycock. “Customer experience presents a great opportunity to differentiate, give the client more of their time back but ultimately help maintain and deepen the relationship that a bank has with their corporate clients.”
It is a point agreed upon by the UX Design Agency’s Pumpurs: “Focusing on user experience shows that the bank is thinking about its customers and will foster loyalty,” he says. “Transaction banking is ultimately a relationship business and banking portals have, for the most part, replaced people as the main point of contact between client and bank. It is vital then that this enables treasurers to do what they need to do quickly and easily and provides them with all the information they need.”
Celent’s Feinberg is keen to point out that it will be more than simply user experience that informs corporate decision making when selecting banking partners. “The bank still needs to provide a high-quality service behind these channels and offer products and services that save the corporate time and money,” she says. “Availability of credit and the relationship manager will also remain important factors.”
That being said, user experience will continue to increase in importance for corporate treasurers as the user experience provided by companies outside of the treasury raises their expectations. Ultimately, a bank providing a good user experience will enable treasurers to perform better. As Agilent’s Gualino concludes: “User experience is a big part of our decision-making because if the team is able to perform the tasks required in these portals quickly and efficiently, then they are able to spend more time on value-adding, strategic activities.”