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38 H.R.M

38 H.R.M

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Published by Priyanka Sharma

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Published by: Priyanka Sharma on Aug 16, 2012
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10/12/2012

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Banks are taking a variety of approaches in implementing technology to make
improvements in retail delivery. The methods differ, depending on the bank
management's mindset toward the purpose of the software and its valued place in
the new business or service delivery processes.

Some banks are convinced that the software developers have had to consider the
effectiveness issues in their design, and see little value in starting with process
redesign. In those cases, the technology decision starts with a traditional approach
to define business requirements leading to software selection and then
implementation. Technology vendors prefer to install their software in the easiest
and most operationally effective way possible. Vendors have become very
effective in making this case. Banks have opted to design the technology
implementation process around meeting the customers' needs and limiting the
work effort required. The challenge has been to accomplish straight-through
processing in order to eliminate potential errors and work duplication.

Most banks do not have an integrated technology solution. Often in isolation, the
"owners" of an element of the process make the system choices for the pieces of
technology they require. For example, the loan accounting system is often in the
hands of loan operations and the credit division usually makes the credit system
decisions. Branch administration may decide on the document preparation system.
Human Resources will drive the incentive system, but sales and marketing
management develop it. The contact management system and the CRM are often
the purview of marketing. Individual system owners most often do not want to
complicate the decision to acquire and install "their system" by including total
integration of all data requirements in the process resulting in largely disconnected
technological environments.

Further, technology is not often applied to simple processes that could reduce
errors, cost and time. Retail banks sell 65 to 80 percent of their new products to

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Human Resource Management

existing customers. Keeping this in full view, the new business process should
allow the existing core systems to populate the appropriate customer data
whenever a customer opens a new product or service.

The trend in technology is straight-through processing or electronic integration of
all the required data elements and support systems. Independent surveys conducted
by the Robert E. Nolan Company reveal that many banks have this objective; but,
to date, very few have accomplished the connectivity in an efficient or effective
manner. The few banks that are integrated have lower time to close, lower cost,
and better quality of data elements. This advantage will certainly impact the
amount of work that a CSR (Customer Service Representative) is able to complete
on a comparative basis. An interesting discovery from the most recent Nolan
Efficiency Ratio Benchmarking Study (analysis completed july 2003) reveals that
there is no correlation between a particular software system and higher retail
performance. The study examined top-tier performers by line of business, asset
size, and type of organization, without noting any significance related to
performance and system use. The conclusion is that performance is more highly
correlated to the process design and integration of data systems.

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Human Resource Management

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