Simon Pomeroy of Westpac NZ: Inside the digital suite
- 29 May, 2014 05:59
“Regardless of the exact figures, we know that the role is currently on a steep upward trajectory in almost all industries, public and private sector, B2B and business-to-consumer (B2C), large and small,” note Gartner analysts Dave Aron and Ken McGee.
Westpac New Zealand is one such company. In January, Simon Pomeroy moved into the newly-created role of chief digital officer.
Since then, Westpac has announced a raft of digital initiatives with Pomeroy and his team at the helm. It is trialling Google Glass and Beacon and progressively rolling out a central Internet banking platform. It is also the first bank in Australia and New Zealand, and just among a handful in the world, to sign an agreement with Samsung to work jointly on digital banking innovations, with Samsung giving Westpac early access to its smart devices.
Pomeroy recently spoke to CIO New Zealand editor Divina Paredes to explain what the role entails and why an earlier grounding in human resources, not technology, gave him the optimum training for the role.
CIO: You just came back from a visit to Silicon Valley and the East Coast in the United States. What are the insights you gained in that trip that are helping you now?
Yes, the senior management team at Westpac visited Apple Google, and PayPal in the West Coast What was immediately apparent was these organisations have a strong culture of growing innovation in their business, and the way they are developing solutions through customer lens.
We also spent a couple of days on the East Coast and we met with strategic partners like IBM and MasterCard. We saw the innovation they are driving and how we can bring that to New Zealand.
Westpac is very aligned in terms of customer centricity, keeping things simple and doing things incrementally. But [also] really thinking about how we are future proofing for our customers.
It is all about the customer experience and it's all about driving solutions that customers are adopting. The way the Internet now is really transforming the way we consume is just evident throughout Silicon Valley. And it's not about technology, technology is just the enabler.
It's about the change in behaviour, essentially, of customers using the Internet to consume. And you're seeing that particularly through mobility. And I often say to people "we've had an online banking solution for about 14 years". We've had a mobile banking solution for less than two [years], and we've got half our online customers now using mobile to bank. We did a survey about 12 months ago and more than 60 per cent of our customers said they would be using a mobile device to bank over the next three years, with more than 80 per cent say they'd be doing it in five. That's a staggering amount of customers.
CIO: Is it because there are more young people now using mobile banking?
I don't think it's an age thing at all. You wouldn't probably call us young, but we're actually digitally enabled. We're using multiple devices throughout the day – tablet, smartphone, desktop computer. And again, I think about our strategy of a device agnostic full Internet banking – the fact that you can use any device to do your banking at any time of the day, anywhere in the world. And now we're starting to think about Google Glass and wearable technology like smart watches.
With the likes of Google, Apple and Samsung developing wearable technology, it's not going to take long before we're all walking around with a device, whether it's a watch or a pair of glasses that we're going to be consuming on. That's changing the way we have to behave. Success will be really understanding that customer behaviour and delivering services that meet that.
CIO: What does digital mean for Westpac?
Everything has a digital element to it in this day and age. Peter Clare, our CEO, came into the bank two years ago and had the vision to say "I this is where our customers are banking, we need to develop services that meet the demand.” And so he challenged us to say in five years’ time this is going to be a predominant channel that people are going to be banking on, particularly through the mobile phone.
He challenged us with two things: Firstly, how do you give customers all of their banking online? Everything you can do in a branch today, how can you put that online and seamlessly link to our people when customers need assistance? Secondly, how do you get that onto a device agnostic platform so that you are not developing three or four times? You're developing on one platform, it's a consistent user experience and it gives people full banking on a mobile phone, tablet and a desktop.
That's made my job a lot easier because I have the support of the CEO, and also the support of the leadership team. We need to have a very aligned leadership team with this strategy because you are talking about, essentially, the banking of the future.
Digital is not replacing people; it's about how you make digital and people work very closely together.
You’ve really got to think about what that looks like from an experience perspective for customers. I think it's that ability to seamlessly connect all your channels for the customer, so that if you do an online [transaction], people [at the bank], and frontline teams know what you have been doing.
Equally, if you go into a branch and have a conversation with somebody, our online [team] knows what you have been doing. So it is seamlessly connecting the experience for customers across all the channels. Our three-pronged strategy: One, delivering this new Internet bank that is fully responsive, and gives you the ability to do all your banking on any device. The second strategy, called Symphony, is our use of the data in a more effective away, total customer management in that total relationship, and being able to personalise one to one conversations with customers across all channels. The third piece is that ability to be able to talk to people in a very personalised way online when they're in session, and rethink about online in the same way as we've always thought about offline.
For a long time we've looked at how do we create this physical branch that delivers this customer experience? And we're still looking at those things, but we're also saying, how do we deliver this online branch that delivers the same experience? How do you take the heritage and the brand and the experience and deliver that to customers in a virtual way, and seamlessly make sure that you're only ever one click away from a human being through those channels?
The ability to use things like live chat or video chat means that we don't have to then go into a branch to speak to someone. Or we don't have to go ring the contact centre to have that conversation. You can come to us straight away. And I think that's really important, because it is all about the customer experience. Banking is relationship driven. Customers make everyday decisions that involve financial services but they also make big decisions, such as buying a home, that they want to have a face-to-face or contact with another human being to talk about that. So for us, digital is not replacing people; it's about how you make digital and people work very closely together. Our digital strategy is ‘digitally led; people backed'. And customers are driving this change.
Next up: Career pathway: HR to Digital
CIO: How did you get into this role?
My career started in recruitment. I spent 1997 to 2005 in an external recruitment role. That allowed me to really understand people and how you can help people develop their careers, change their lives effectively through to the jobs and the decisions they take around jobs, and also the value that recruitment can deliver. This was how I used to talk about recruitment: If you make the right decisions as an organisation with the talent you bring in... You might need to spend $50,000 hiring someone, but the right person is going to bring you $5 million to $10 million worth of incremental value, or drive your retention through your organisation of 20 per cent higher. It was enhancing lives, enhancing organisations.
I then moved to Air New Zealand. At that stage, recruitment was fairly broken at the airline. It wasn't aligned to [then CEO] Rob Fyfe's vision of what he wanted the experience to be. So I went in and helped transform the recruitment and talent function. Then I moved into a role, which was completely alien, around customer experience and loyalty .The reason why I was moved into that role (as head of customer loyalty) was because again, it's that understanding of people.
The crucial thing for me was we moved from flying planes…to flying people. That’s always resonated with me. It's not about technology, it's about the customer’s mobility and technology is the enabler. That strategy then was to say "You've got an airplane with 200 people on it flying to or from Australia to New Zealand.
“Every single person on that plane has a different need to travel, has a different experience, is either going to work, coming back from work, going to see a loved one, possibly going to bury a loved one. And so, how you deliver that experience is very personal and very unique. The second thing is when things go wrong – how do you recover from situations?”
I came into Westpac to run the customer experience program. That’s where the whole Symphony strategy came out. It was about delivering this personalised experience around financial services and helping customers to grow financially, helping customers to be able to retire, helping them in the first home, using data in a very smart way to be able to have those kinds of real-time one-to-one conversation with customers in a targeted and timely way. But also, making sure that when you interact with a customer, you ask them if they've got feedback.
If it's positive feedback, we can then go and give recognition to our internal staff for the way they've managed that customer so you can use it to really drive praise. And when a situation hasn’t gone right for a customer, we can then get our teams to close that out and make sure we actually recover that situation. We're seeing a huge change in our net promoter score, our customer sentiment score. People want to be listened to and heard, but they also want you to do something about it when you ask them that question.
I did that for a year. We were already working on the customer transformation around Symphony, then picked up all the digital channels. So we started running that and then in January of this year, I became chief digital officer.
I think the reason why this has worked [is] I don't profess to be overly technical and I think that we don't want digital to be technical. The fundamental difference between ourselves and other organisations is that digital doesn't sit in technology here, it sits outside of technology. It almost sits in between technology and marketing and sales. It sits where it needs to sit to deliver customer outcomes. And then it uses marketing and products and technical to deliver the solutions, which are very much aligned into customers.
So digital really needs to enable our customers and enable our staff. And we're really seeing big differences. Again, with the Symphony strategy we created a dashboard that sits in our CRM system that gives a single view of the customer. It actually gives our staff the ability to view what products a customer has and doesn't have with us, what their recent experiences have been like with the bank, their customer sentiment, the scores that we get back from customers. That single view enables them to have a really targeted next best conversations with a customer when they come into a branch or in a call centre.
The fundamental difference between ourselves and other organisations is that digital doesn't sit in technology… It almost sits in between technology and marketing and sales. It sits where it needs to sit to deliver customer outcomes.
With our Beacon strategy, when you walk into a branch now and you get recognised, your picture pops up and the next best conversation strategy pops up. These are things that make staff feeling really engaged, because it's enabling them in the same way that it enables customers to get their outcomes.
The great thing about the strategy that we've got with Internet banking, and also wearable devices, is that we've developed proof of concepts and we've developed prototypes and we're testing them. That means when Google Glass is launched in New Zealand in a year’s time, we will have a year’s worth of refinement and testing on staff before we put the solution into the hands into our main customer base. We'll be leading the market, because rather than just delivering a solution, we'll have 12 months of refining that solution before it goes into the hands of all of our customers. Again, a fundamentally different approach.
CIO: How do you keep abreast of what's happening in the marketplace and business technology?
I always go in [to visit Westpac branches] and I always put myself as a customer. I always look at the solutions that we bring out as a customer. But when I go into a branch or I call the contact centre, I don't tell them who I am. And so I get to see it as a customer. All our executive team spends time out in branches and with the contact centre.
Going on trips, like the one recently to the United States, working as part of that collaborative leadership team, is really important, as well as reading. I get daily updates from a whole range of places that gives me insights into what people are doing in all industries.
The key for us, as well, is don't necessarily look at what's been happening in banking. We look at what's happening in places like Google, Samsung, Apple, and Amazon; in organisations that we believe are thought leaders in this space.
We benchmark ourselves against other banks. We work with Finalta, a research company (a subsidiary of McKinsey & Co) that looks at us against our peers globally. They surveyed more than 64 banks around the world and they give us the feedback based on how we're doing. Westpac New Zealand is among the leaders in Finalta’s global peer group at driving uptake of digital banking. Westpac New Zealand has delivered the fastest observed growth in mobile banking over all 64 banks globally that we've been reviewed against.
We are working with best in breed organisations globally. Collaborating with people like Samsung has been very exciting. These are big businesses with global footprints that are endorsing what we're doing.
The other thing about it that I think is really crucial is the partners that we work with to build the cornerstones of our strategy are New Zealand based businesses: SilverStripe, which developed a lot of our Web solutions; Alphero, which developed a lot of our mobile solutions;, Affinity ID, which runs our Symphony program.
We want to be the best digital bank globally, but we also want to really help grow New Zealand. Peter Clare is very passionate about us working with really good local partners; that our success helps drive their success. And so it's a great position to be in. We celebrate their success as being best in breed globally, as well.
Our aspiration is to be the best digital bank in New Zealand by the end of the year, and the world by the end of next year. Again, Peter Clare has set the challenge, and we're well on the way to doing that. I can see no reason why we wouldn't be in the top five or 10 digital banks globally by the end of this current year.
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