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Digital transformation has spawned a race for customer centricity across all industries, breaking down industry barriers. Banking is no exception. New cognitive and collaborative technologies enable bankers to get closer to their customers, cutting across their own internal silos to meet customer needs. And banks face dizzying competition from the likes of Apple Pay, Google Wallet and Facebook Messenger, not to mention an emerging army of fintech providers and challenger banks. Playing catch-up is no longer enough. Banks need to get ahead of the game.

Modern workplace technologies are ushering in a new era of personalized, proactive and predictive banking. Everyone agrees that trusted data is the new currency of business. “Processing customer information securely and understanding customer needs at a totally personalized level is key for bankers to succeed,” says Guillermo Kopp, director, worldwide financial services industry at Microsoft. Digital market data, newsfeeds, and social media are creating vast pools of data, thus providing a goldmine of customer insight for bankers and financial advisors. Bankers can deepen customer relationships through Microsoft’s integration of LinkedIn with modern workplace solutions and business applications. From a rich pool of data, bankers can use machine learning to predict next best actions and make targeted offers to those customers most likely to accept, when they are most likely to accept them.

“Banks are facing a tectonic shift in their business model and are facing competition from inside and outside their industry. It’s all about personalisation. There is an urgency to transform their business and to help their customers transform theirs,” says David Cox a digital advisor in Microsoft Digital.

The rush for customer centricity is creating a new model of open banking – cloud-based and data-intensive – with open APIs to make it easier to add new products or let go of old ones. Legacy banking infrastructures means legacy data – fragmented and often incomplete, making customer-centricity a work in progress. Open banking accelerates the flow of data throughout the bank, empowering bankers from call centres to deal-makers to help customers achieve more. Add artificial intelligence to the mix and you have a range of technologies from bots to robotic process automation; from customer alerts to automated process improvement – a leaner, simpler more customer-focused model.

Private banking and wealth management tend to rely more on face-to-face interaction than retail banking, and artificial intelligence and collaboration technologies can add valuable customer insight. “A bot could be used to reason over client questionnaire data, looking at all the variables to suggest portfolio options before escalating the discussion to the human advisor,” says Richard Peers, director, worldwide financial services industry at Microsoft.

“The bot might spot, for example, that a client who is supposed to have a low risk appetite for investments spends money on gambling sites, suggesting perhaps that higher risk investment strategies could be appealing. This can open a new conversation with the banker. If the client is still unsure about the suggested investment product, predictive analytics can be used to provide a simulator that allows them to explore what would happen to their money over a year, without them taking any risk. There is endless potential to educate customers proactively about their finances through gamification, and allow them to try things out interactively to see what works for them.”

Technology truncates time, and time can be the difference between winning and losing a deal whether it’s a mortgage, a credit card application or an IPO. So, real-time collaboration and productivity tools can make the difference between success and failure. Cognitive services and robotic process automation, for example up-to-date documents and information about a meeting and the people who will attend ahead of time, can add enormously to a banker’s performance just when it matters most.

“Empowering bankers is about enabling them to do their job in a different way so they can work more productively and provide products and services that are simpler and better aligned to customers’ needs,” says Monique Dahler, director, worldwide financial services industry at Microsoft. “Banks realise that artificial intelligence lets them move more efficiently and faster to deliver innovative and personalized customer experience.”

Artificial Intelligence has emerged as much more than a set of tools; it gives rise to an augmented work capability that empowers bankers by combining their skills with powerful technologies. “The bot framework enables banks to quickly pinpoint relevant information and analytics, and to speed up time to market,” says Dahler. “The new value stems from the artificial intelligence value chain which includes capabilities from building apps to predictive analytics, intelligent information management, machine learning and cognitive services with speech and language recognition.”

These capabilities are already having a significant impact on banker productivity. The full transformative power of the artificial intelligence value chain, combined with secure cloud computing, will be seen over the next few years. Above all, the experience needs to be seamless, flexible and agile to empower bankers to address the changing needs of customers, regulators and the business. “To achieve this, banks need a clean data model,” says Peers. “They will process high volumes of quality data securely with machine learning and customer experience management to serve up insights. We’re seeing banks moving their infrastructure and apps to the cloud and building smarter data models.”

“We’re working with banks to prepare for the future,” says Dahler. “This is about enabling bankers to engage with customers the way customers want to engage – whether that’s through social media, online chat or face-to-face – using artificial intelligence. We’re bringing together the capabilities of a suite of modern workplace technologies with actionable customer insight using predictive analytics and machine learning. This will empower bankers to instantly understand the history and profile of the customer they’re talking to and to get an accurate view of their needs.”

Empowered by the artificial intelligence value chain, bankers will drive customer-centric change over the coming years. “Bankers are facing enormous change,” says Peers. “Banks need to drive down costs and be more efficient, and low value tasks will be automated in the future. As artificial intelligence takes care of repetitive tasks, bankers will be empowered to focus on analysing outcomes. In this age of digital intelligence, an almost clairvoyant ability to anticipate customer needs will enable bankers to drive customer-centred change.”

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Read more on the Microsoft Banking & Capital Markets and Insurance blogs.