When an earthquake in Taiwan broke a number of underwater cables and disrupted international communications in 2006, pressure went through the roof for an affected bank.
Who doesn’t want to restore disrupted services to customers as quickly as possible and in an efficient way?
The bank got through the crisis and once it settled down it began to rethink its network system carefully.
Today’s landscape is even tougher for any CIO, who must maintain the integrity and security of a bank’s systems while driving innovation and creativity and building a risk-taking mindset, according to Peter Clark, Standard Chartered’s regional CIO of Greater China & North Asia.
“The main priority of a CIO - protecting the stability and security of a bank’s systems - has not and will not be changed,” he said.
“But as customers are looking for more digital solutions, and the competition landscape changes with technology companies entering the banking market, regional CIOs have to drive innovation, creativity, customer centricity in their team to anticipate customer needs much more than in the past where they were service providers,” he added.
Clark works with Standard Charter’s country CIOs in China, Hong Kong, Taiwan, South Korea and Japan. He said he makes sure they stay close to customers and their customer-facing staff.
“I encourage them to spend time understanding what is happening in the market and adopt a risk-taking attitude to try things and not worry too much about failure as we can learn from it,” he said.
Part of the responsibility for each of the CIOs across Standard Charter’s banks in five countries is taking the lead in certain areas and developing some expertise that can be shared with other countries.
“In Hong Kong, the local CIO focuses on distributed ledger technology (DLT), AI and machine learning whereas Internet of Things (IoT) and big data are the focus in China,” Clark explained.
These CIOs also expected to take the lead in identifying future opportunities for banks to provide customers with the products and services they want, as well as interact in a way they want.
Clark sees a lot of innovation coming up in the banking industry as technologies evolve. He sees at least three things that will significantly impact banks in a big way: artificial intelligence (AI), DLT and biometrics.
“AI will have a big impact on banking,” he said, sharing that Standard Charter is working with fintech company Bambu, which specialises in using AI for investment management.
“We are working with them to see how their technology can help us analyse customer data, customer preferences plus the market to create optimal investment,” he said.
DLT, on the other hand, is still in the early days, but the Standard Chartered CEO said that the main areas they are looking into are trade finance and KYC (know your customer).
“I see KYC can be benefiting a lot in the short term. Instead of having to submit their KYC to 10 different banks, customers can submit to one and get replicated across. We are doing a POC (proof-of-concept) on KYC for our corporate customers,” he said.
On the trade finance side, Clark said the next phase is commercialisation as the proof of concept is finished.
As far as revenues are concerned, he believes that DLT might not necessarily raise a lot of revenue or reduce cost, but it will reduce risk and improve customer experience significantly.
In the field of biometrics, Clark thinks the technology may have a big impact even for very simple things like Touch ID (fingerprint recognition) and mobile apps. In fact, retina scan and finger vein recognition are already quite successful.
“We are also working on some POC projects on IoT internally to see how it can enable us to provide value added services particularly to our commercial and corporate clients,” Clark said.
Standard Chartered has announced a US$3 billion global investment over three years to upgrade the bank’s technologies and systems. The goal is to improve customer service.
Driving a customer-centric culture
Asked what his key goals and challenges are in the next 12 months and beyond, Clark said the priority is to keep the systems running in a stable and secured way.
“The other thing is driving a culture of customer-centric innovation throughout the organisation, not just talking about it but to deliver it to ensure we have a capability to rapidly meet the evolving needs of customers,” he said.
But a big challenge is balancing day-to-day needs of maintaining operational and system integrity while at the same time trying to drive a lot of transformation and innovations.
“The foundation is creating the right culture, getting the right people in, and a real understanding of what we want to be. We want to be a digital bank with a human touch,” he shared.
Clark’s point is if the bank can combine digital offerings with great human customer services, this can really differentiate an organisation from its competition.
“That is clearly what we want to be. Branches are important and are a vital part of our business. I see that going hand in hand with digital offerings,” he concluded.