This American Banker Technology article “Wells Exec Guards Against Self-Service as Disservice” brought back memories with its references to the impersonal nature of machines and self-service. All the banks are talking about “customer engagement” and “customer experience” as a top priority – and that’s admirable. The articles states: “Jonathan Velline, an executive vice president at Wells Fargo, likes to use the word engage in discussing the role of the branch. As banks modernize their branches and provide more self-service options such as tablets and video-equipped kiosks, they have to guard against losing the human touch, he says.” I did kind of chuckle when I read that.
When I think about innovation and banking, the first thing I can think of is the launch of the ATM machine. It was originally called the “Bankograph” and an experimental one was installed in New York City in 1961 by the City Bank of New York (Citibank) but removed after 6 months due to the “lack of customer acceptance”.
The 70s changed everything. I had the privilege of meeting one of the pioneers of the ATM machine, Walter Wriston, former chairman and CEO of Citibank (1967-1984) while working at Citigroup a few years ago. He expressed to me that he met with some opposition early on around the security aspects of ATM machines, as well as the “soul-lessness of machines” in general, not to mentioned the proposed $100 million investment price tag (which ended up closer to $160 million and the largest capital expenditure in Citibank history).
So what’s my point? Clearly, Wriston’s opposition was made to look pretty clueless by the consumer banking population which quickly and fairly seamlessly embraced the convenience of the machine that spits out money and accepts deposits 24/7- “without a soul”. What is really fascinating about the ATM integration is that after the technology had earned the trust of once highly skeptical customers, an amazing transformation began to take place: Face-to-face business became face-to-interface, and it changed the way people consumed. Technology began to drive human behavior.
Not much happened on the customer facing front since the ATM until online banking emerged in the late 90s. Having worked at Chase in online banking at that time, I do recall the major concern against using online banking was the fear of fraud – and that fear remains through today in terms of hacking – but the gap narrows as the younger generations enter into the fold and security measures evolve.
Fast forward one decade and mobile banking becomes the next level of innovation with its own set of security risks. That said, Forrester predicts “….the number of US mobile banking users to double in the next five years and reach 108 million by 2017 — 46% of US bank account holders.” And specifically, “Everyday banking relationships are moving to mobile. Consumers are progressing from simply checking their account balances or locating an ATM to making bill payments or transferring money to other accounts on their mobile phones. As that happens, mobile banking is displacing use of other channels like branches and online banking.” So much for the human touch.
Unlike with the ATM – technology is no longer driving us – the consumer is extremely comfortable with technology and is now in the driver’s seat and demanding advanced and convenient methods of interaction from their financial institutions. Human behavior is now driving technology and how business is done in many industries – including financial services.
So, with that in mind, is self-service really disservice? Or, is assuming what the customer wants really the disservice?