Avaya: embracing the art of the possible
For today’s big banks, technology transformation is a must. Ioan MacRae, UK & Ireland Managing Director for technology solutions provider Avaya, says it doesn’t have to happen all at once.
Now more than ever, it’s vital for businesses to provide a high quality, tailored customer experience driven by technology. This is especially true for the finance space, as the rise of fintechs and challenger banks focuses on meeting consumer expectations; those large financial institutions which do not keep up risk being left in the dust. Avaya, a leading provider of tech solution to global clients, has studied recent changes in customer experience expectations to ensure it is best placed to help the companies it partners with grow through ‘experiences that matter’.
Ioan MacRae, Managing Director UK and Ireland at Avaya, has been involved in the tech industry for around two decades, having held roles at Cisco and Nortel prior to joining Avaya. He took his current position in 2012, having gained international experience in the Middle East, and relishes his role to this day. “The culture is brilliant. I’ve got a fantastic team,” he enthuses. “We have large team of about 360 people in the UK and in Ireland you can double that with our R&D centre in Galway. All that can only be in play when you’ve got great technology as well,” he adds.
The UK and Ireland is Avaya’s second largest region after the USA, and over the past few years the company has experienced positive financial growth. “We’ve delivered and exceeded plans,” says MacRae. Through partnerships with BT, Vodafone, Virgin Media and the like, it’s probable most consumers in the UK have interacted with Avaya solutions, even if they haven’t realised – but Avaya has certainly noticed the consumers. Indeed, it has recently released its latest consumer survey which found that machine learning technologies are being embraced with gusto globally, and the UK is no exception. 51% of UK consumers prefer to have questions answered by an AI chatbot while shopping online or using an app, with 32% going as far to say they prefer this to human engagement.
“It’s a very changing environment at the moment,” MacRae comments. “Like any R&D organisation we never stand still; we’re constantly developing to meet the demands and challengers of customers.” As such, Avaya is well-placed to look at how customers have evolved, and MacRae says it’s important to understand that just as banks and other corporations are at different stages of the technology journey, so are consumers. “If you look back 10-15 years ago, we were quite happy going into our local bank and issuing cheques. 10 years ago, telephone and internet banking were both fairly modern, then seven or eight years ago came the common adoption of smartphone technology. Five years ago, apps became more commonplace and so you can see new demands on any financial institution, especially in retail banking, where technology adoption among consumers is so rapid.”
Despite all the technology at our fingertips, MacRae stresses the importance of choice to keep customers comfortable with their finance needs. “There are times when people do want to pop into a branch or speak to a human,” he explains. “The idea is that you give the customer the option but consistent service comes through.” He cites his own family as an example: two sons, 17 and 20, MacRae himself and his parents, in their late 70s, all use the same bank. “The way my children will do self-service compared to me and my parents is totally different. We’re all in different parts of our life in terms of mortgages and debt, but trying to serve three generations via traditional methods as well as more complex methods is very challenging.”
As an increasing number of banks turn to AI and chatbots, as well as voice biometrics for identification, this is likely to form part of the consumer journey as opposed to replacing it. A customer might use a chatbot to get to the right place but will still want to speak to a human. “At that point, I still want my call answered immediately by an agent, but I want the agent to know what I’ve been calling about. I don’t want to have to tell them the journey I’ve been through,” MacRae explains. “The adoption is there, but in varying degrees.”
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Based on his company’s extensive research into the UK’s financial technology scene, there were some aspects MacRae didn’t expect despite his extensive experience on both sides of tech. “What surprised me is how much people are willing to adopt technology from smart speakers to chatbots worldwide. People’s knowledge was higher than I thought on a global basis, and their willingness to have it as part of their customer journey was a pleasant surprise with it.” MacRae also points out how technology has permeated every area of business – for example, chatbots need to be connected to the marketing department to offer appropriate responses. “IT, security, marketing… all different departments need to be part of this digital transformation.”
Equipped with this knowledge that change is influencing businesses and demanded by consumers, every financial institution worth its salt is on a digital transformation journey, but MacRae advises it doesn’t need to happen all at once and Avaya can guide organisations through each stage. “It’s not just about understanding what’s out there and the art of the possible, but it’s also about ensuring we understand our customers exceedingly well. Where are they? What technology have they got today? What is the customer experience they’re offering currently and what would they like to be offering?” Often, that customer experience is the place to start when developing digital strategies in banking.
“It’s a big conversation, a big journey, and it won’t stop,” MacRae adds. “They’ll do each piece at a time, but technology is being adopted and altered so quickly – my sons for example will be demanding different experiences in the next five to 10 years than I ever will, and most certainly more than my parents.” The solution does not have to lie in building stacks of technology in-house, however, and MacRae actively encourages large organisations to partner with technology companies: whether it’s an experienced industry advisor like Avaya or a new, more niche fintech. “It sounds easy to improve customer experience, but it’s a huge undertaking for these big organisations, and it doesn’t need to be done overnight. It’s not one big bang. My advice to any big financial institution is to have conversations with your vendors and partners, understand what can be done today relatively quickly and easily to start the journey of transforming customer experience, as well as looking at the long-term plan. You might have voice only contact centres, followed by introducing email next month and then web chat. A conversation is free, so embrace your vendors.”
FIVE things fintechs must do to keep investors onboard
New investors flocked to the stock market during the COVID-19 pandemic. Thirty-eight percent of investors said they had never had a brokerage or similar account before opening one in 2020.
Low or no-fee trading options have helped accelerate the trend – nearly half of new investors said they accessed their account primarily through a mobile app. As FinTechs, how do we create the trust needed to keep new investors in the market and create a fruitful customer experience for them?
The financial industry does a disservice to individual investors if we merely offer tools that focus on making money quickly, an approach that usually backfires. Instead, the surge of interest presents an enormous opportunity for those who want to help more consumers use financial technology to educate them on responsible spending, saving, and investing in order to achieve financial wellness current fintech tools have welcomed individual investors in the door.
Now, it’s time to focus on education and improving their experience going forward. There are several ways those of us in fintech can step up to shape the future of retail investing so that it works better for everyone, starting with the following areas.
Equal access to financial wellness education
Financial health should be available to everyone — but today, not everyone has the educational resources to achieve it. One study shows that only 3.9% of students from low-income schools were required to take a personal finance class. What they aren’t learning in school or from family members, fintech companies can provide on their platforms.
The companies should move from solely offering financial services to a more responsible model of education, advice, and prescriptive choices to help consumers develop better habits and make wiser financial decisions. Not only can they empower consumers and bridge historical wealth divides, but they can also stimulate growth by opening up new consumer segments.
Just as we’ve come to expect that our fitness routines are tailored to our individual bodies, we’re also ready for finance tools that go beyond one-size-fits-all solutions. But only six percent of financial institutions say they’re using the kind of technology that allows them to deliver a deeply personalized experience. Fintech tools need to reflect that financial success looks different for each of us.
For one consumer, it may mean providing guidance on how to pay off student loans early; for another, it may mean prescriptive actions that enable them to stick to a budget for the first time; for a third, it could look like prioritizing environmental, social and governance (ESG) investments, so that her portfolio aligns with her political beliefs.
Now, we are seeing financial technology beginning to meet the demands of personalized finance in a substantial and meaningful way.
The rise of AI-Powered Advice
Big-picture advice and predictive guidance used to be a feature of high-end financial advisory firms — a perk only available to those who could afford it. But thanks to rapid advancements in data analytics and artificial intelligence (AI), that kind of holistic advice is now more accessible than ever. AI-driven robo-advisors can parse many different streams of financial information, delivering customized answers to key questions: Is it time to buy a home, or is it smarter to keep renting? Can I afford to take out another student loan?
Intelligent connectivity powered by AI can anticipate consumers’ needs and next steps, making proactive suggestions that guide them along the path to financial wellbeing. Fintech companies can also help consumers identify when their financial picture becomes too complex for a robo-advisor, and help them find a human financial advisor to meet their needs.
Focus on financial mental health
New investors are quickly finding that the market can be overwhelming. That’s not surprising, financial anxiety is common and studies show that financial stress can have an impact on mental health for some.
It’s not enough for fintech companies to give retail investors access; they also must provide the guidance and support that help consumers manage their financial well-being. Educational tools can ensure that consumers are well informed about their options.
Predictive analytics can anticipate consumers’ questions, serving them key information and insights before they ask. Features that emphasize a comprehensive notion of financial well-being, rather than short-term wins and losses, can also help ensure that consumers are keeping their eyes on the bigger picture.
Gamification for good
The surge of gamification apps has done an impressive job making investing as engaging as playing a video game or joining a social media platform.
Much of the current use of gamification emphasizes short-term thinking, but there’s also an opportunity to help consumers think more broadly about their overall financial picture. One example is peer benchmarking, a feature that enables help consumers to see how their financial habits compare to those of friends and fellow consumers.
Gamification can also be used to incentivize making smaller, smarter choices — for example, rewarding saving over making an impulse buy.
The future of fintech is about more than just broadening access to the markets. It’s about making sure more individuals have access to the tools that can help improve their financial well-being—in the ways that suit their own circumstances and needs. The potential to act within their own set of individual priorities, with their long-term financial wellness in mind is much more empowering to a consumer than simply relying on short-term, high-risk investments.