Consumables

Re-engineering processes to reduce paper can yield both cost savings and revenue gains for financial services

Wednesday 18. September 2013 - Global research shows financial services lags in optimizing document workflows

More than 1 in 3 document processes in financial services (37 percent) are still driven by paper, according to an IDC Financial Insights Market Spotlight based on an IDC white paper sponsored by Ricoh(1 )entitled: “Optimizing Document Processes Provides Dual Benefits for Financial Services Firms: Increased Revenue and Cost Take-Out, July 2013.”
Although business in general still relies on paper, the financial services industry is particularly behind the curve and stands to make especially significant gains by streamlining its information workflows, according to the recent IDC global study of 1,516 document-driven process owners and information workers.
Since financial services companies have worked hard to reduce reliance on paper in back-office processes, the biggest opportunities now lie in streamlining front-office processes such as marketing, customer service, lending and customer on-boarding. “Unlike back-office functions,” the report states, “these processes directly impact the customer experience, and therefore have the dual benefit of increasing the firm’s revenue as well as reducing costs.”
For financial services in particular, optimizing these customer-facing processes could increase revenue by 10.7 percent while also reducing overall operating costs by 10.5 percent, study respondents said.
“Although there are good reasons a lot of financial information is initially captured and then locked in paper, organizations can gain so many business benefits by unleashing it,” said Yoshi Sasaki, General Manager, Business Services Center, Business Solutions Group, Ricoh Company, Ltd. “With the right workflow in place, paper documents can be converted into digital information early in its lifecycle and make that information work for you. There’s ample opportunity to cut costs, improves sales and delight the customer.”
For example, digitizing workflows frees bank branch personnel to provide higher-value services to customers, build more meaningful relationships and cross-sell/upsell more products. That’s just one of the reasons financial services companies are currently budgeting significantly more on improving customer-facing business processes than other industries. According to the IDC white paper, financial services firms are budgeting on average:
— $2.5 million per project to improve marketing/customer communications
processes compared to $1.4 million for other industries.
— $1.7 million per project to improve loan origination/sales processes
compared with $1.1 million per project for other industries
— $1.3 million per project to improve customer on-boarding processes
compared to $819,000 for other industries
— $2.1 million per project to improve customer service document processes
compared with $1 million per project in other industries.
“As you can see, innovative financial organizations are making strategic moves now to improve their information capture, transformation and management,” said Sasaki. “Those who succeed understand that it’s not enough to make paper digital without addressing the underlying workflows. Many of these higher-achieving organizations are Ricoh customers employing our solution experts in Managed Document Services engagements that focus on solving business problems and delivering promised results.”