Mr. Charles Duell may or may not be known for the work he did with the United States Patents Office, but he is known very well indeed for one notorious saying.
"Everything that can be invented has been invented."
The irony of the statement is evident enough today.
In the Banking and Financial Services Industry alone, digitisation and digital transformation have changed the landscape of how we think about money.
Nearly fifty years after Mr. Duell's statement, the first debit card was released. Just a hundred years later, people 'visit' their banks on their mobile phones.
As a sector, then, banking needs resilience and the ability to change. Financial services shape the economy, so the onus is on them to predict what the future will hold, and in some cases, even turn this forecast into reality.
As one of the key pillars of global economy, banks and financial institutions are perpetually evolving to meet economic needs, while also being extremely susceptible to market volatilities.
With the advent of digitisation in the late nineties and around the turn of the new millennium, the concept of a physical bank has been quickly augmented by paperless transactions, digital fund transfers and automation at every level.
This trend is continuing to evolve even further with new payment methods, security features and currencies coming into the picture. Plus, financial institutions are not only responsible for transactions but also for funding new business ideas, thus fostering economic growth.
However, threats to the sector are significant and innumerable.
Currently, the three most significant threats to operations are
political policies, and
market volatility post the pandemic
The Impact Of COVID-19 On The Global BFSI Sector
As a response to the subduing of economic activity during the pandemic, banks around the world have experienced shifts in expected cash inflows.
With several businesses seeking loan repayment relief either in the form of an interest-free loan period, or a liquidity crunch due to negative consumer sentiment, the lifeblood of the sector has taken a direct hit.
However, the pandemic has only accelerated a much-needed shift in banking operations.
While digitisation in BFSI was often perceived by policymakers as a slow yet inevitable process, the need for a flexible, resilient banking value chain in the face of uncertainty has been highlighted further.
In this context, banks need to depend on ERP solutions such as SAP in four key areas, namely:
Omnichannel Consumer Experience
Analytics-Powered Spend Management
The SAP Solution For BFSI
SAP has powerful solutions to offer to address each of these areas of transformation in BFSI. Using SAP, customers across sectors can be serviced in a seamless manner, and human salespeople can benefit from available swathes of data to offer custom solutions to each consumer and meet their precise need.
With the threat of new entrants and disruptors perpetually looming, this access to data is the difference between an agile bank and its slowly decaying competitor.
Moreover, mounting costs are an issue across businesses but a particularly niggling issue in BFSI, made even worse by the pandemic-issued cash crunch. Spend management solutions can help alleviate these issues to a great extent and give makes some much-needed relief, particularly in the tough years coming up for us globally.
One of the areas of BFSI that is considered an inherent business issue is risk management. The issue of loan defaulting, borrowers going bankrupt and forces of the economic causing perpetual adjustments to the interest rate is very real.
SAP provides answers to all of these concerns at the very minute, everyday process level, making it a formidable tool in beating competition.
Implementing The SAP Solution In BFSI: The Need For Training
IT operations in BFSI are a core aspect, and these are becoming nimbler and more product focused while the finance function may continue to budget and fund the same way it has for decades.
Leading organizations in thesmselves are moving to new financial processes that flow them to innovate faster, fail faster, and do not penalise them for trying to operate in a volatile environment.
To cater to this need, banks and financial institutions have been making investments in strengthening their digital core that covers migrating to the cloud, modernising and automating several core processes and using the power of data to personalise the financial experience for individual customers and business account holders alike.
However, transformation at such scale is often held up by issues such as
The inability to forecast returns on investment
Lack of expertise among SAP end-users
Lack of time for SAP power users to facilitate organisation-wide learning
Essentially, people are hesitant to use what they do not fully understand. SAP, by virtue of its sheer depth, often ends up being too difficult to train people on.
However, a standard training solution can help solve these issues quite effectively. For one, nearly 70% of SAP training can indeed be standardised, making the process much faster.
Plus, a solution like Espresso can help deploy SAP training across branches, offices and geographies at the same time.
Espresso also provides multilingual content with examples specific to the BFSI segment, thus giving people a better shot at understanding and using SAP better at work.
Eventually, this results in time saved in query resolution and support costs, thus making it a very viable solution to train several SAP end-users in one go.