Bank News: Small Banks Capitalize on Mistakes Made in Early Automation Implementation

The below article was published in Bank News on June 7. Read the full article here.

— When major banks quickly jumped on the Robotics Process Automation bandwagon in early 2015, small, regional and community banks found themselves faced with trying to keep their customers happy in light of growing feature sets from larger institutions made possible to technological innovation powered by automation.

Clinging to the hope that “A+” customer service would keep their customers faithful, small and mid-tier financial institutions reluctantly weighed the pros and cons of automation and developed plans to integrate process automation in their upcoming budgets and IT planning.

“Automation opened up real opportunities for big banks to increase their profitability, decrease errors, and lower liability, despite a hefty upfront investment,” said Keli Domke, Managing Director of Banking at Digital Intelligence Systems, LLC. Domke elaborates, saying some of the main areas financial institutions are capitalizing on the use of RPA are fraud prevention, financial product interaction, and managing large amounts of data.

With process automation as an efficiency driver, larger banks began to close branches and make drastic workforce cuts – especially in the bank teller positions. In fact, experts predicted nearly 30 percent of banking jobs would be easily performed through an automated process before 2020, according to CNN’s Money.

In the banking industry’s early days of automation, investment into the technology investment was high but nearly immediate returns were delivered. But as basic automation became increasingly standard, the industry began seeing the stopgaps simple bots could not accommodate.

Simple RPA implementations had indeed increased productivity and minimized risk and human error, but it became a frustration point when organizations used simple automation versus orchestrated – they hadn’t taken into account how all these simple tasks worked together to fulfill important, business-critical tasks. Also, institutions had not considered the inadvertent tasks human employees had taken on, outside of their general job responsibilities. In short, the honeymoon was over and banks began to suffer the realization of incomplete planning.