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When animals collide: Tigers rip up the Longhorns!

04 October 2004  |  7939 views  |  0 Source: Chis Skinner, TowerGroup Chris Skinner

Chris Skinner says the next generation of PCs will transform consumer banking

Am I speaking a foreign language? Tigers and something with a Longhorn. A Rhinoceros maybe? Don’t worry. I’m not trying to confuse you. I’m just talking the language of the next generation of PCs and the importance of these animals to bankers will be that it will transform the way you deal with consumers.

I guess I ought to begin by letting you into the secret of the animals. The Tiger is Apple’s next generation of the Mac operating system and is released in the second half of 2005. The Longhorn is Microsoft’s next generation of Windows. Not the Service Pack 2 interim security but the real whizz-bang upgrade to Windows’ features, functionality, style, look and feel, currently due out in 2006. I’m not going to go into the ins and outs of these new systems but purely want to relate to you the bottom-line message of these systems. Video.

Apple’s Tiger and Microsoft’s Longhorn are specifically targeting to bring real-time, online video connectivity to the home and mobile user. Not the low resolution 3G video calls we make today, but very high definition televisual style video calls. Imagine it. A call that looks as good as your TV picture? And making those calls will be as easy as clicking on an internet site. Actually, it will be easier because Microsoft’s developments go one step further than videocalls. Videocalls on TV. Yep, Microsoft is not just going to allow videocalls on your mobile, PDA and PC, but on your TV too.

Why is this important? Well, think about it. If you can use Apple’s hi-bandwidth next generation to connect to your friends effortlessly via video in 2005, and the same with Microsoft in 2006, doesn’t that change the whole way in which you deal with everyone and everything?

First, you will be able to see people through a virtual connection anywhere, as long as they want you to see them that is, which is quite a big thing in and of itself. After all, the videophone has been discussed for years but it’s always been a ‘futures’ thing. Then, last year, we suddenly found ourselves making videocalls on mobile phones. Admittedly, these calls were pretty awful, in terms of quality, but it was a start. Now, with these new developments, the videocall becomes a high quality reality.

Second, your customers will be able to see you too. And that is where it gets interesting. After all, most of the banks I deal with – as a consumer – appear pretty efficient on the outside but, on the inside, they are a mess. They have legacy system upon legacy system. So, if we take a typical telephone call to my bank, the call will be serviced by an operator – these days likely to be somewhere in India, China, the Philippines or South Africa – who has to bring up six or seven different systems and screens to deal with the call. This assumes the caller has only one product. If the call involves several products then that’s a real disaster as you can multiply six or seven screens by anything up to sixty screens or more. But it’s ok because the customer does not see this mess. Until now.

Now, and over the course of the next five years, every organisation that deals with customers virtually will be evolving services towards high bandwidth online video, and that means the mess needs to be tidied up. And there’s the challenge. The challenge is firstly organising and integrating previously fragmented and diverse legacy systems into a cohesive whole. This will be to avoid having customers seeing agents juggling a deck of different windows to handle their calls and is likely to mean mass upheaval of core systems. In fact, you can see it taking place already this year, with a large number of core systems replacement programmes under way.

Nevertheless, even with systems reorganised and integrated, there will still be major challenges. Specifically, all of your agents will be visible to the customer and the question will be what style and look do you want your bank to have: hip and trendy, old and fusty, grungy and greasy? Do you only hire good-looking young things or anyone? Do you pay a premium for better looking agents? How could such potentially discriminatory policies be misinterpreted? Again, I have already met one banker who is considering resourcing their contact centre with drama students only, as they bring more life to the call than a normal agent. Or maybe it is because they are better looking than the usual agents?

An alternative view of the future is dealing with videocalls through automated agents. These automated agents are referred to as ‘avatars’ and can be seen today on some bank internet sites, such as the Newcastle Building Society. Their site includes an advisor called Avril, who is an automated video representation of a real person and provides advice on their products and services. Avril may be rudimentary but in five years, every video contact centre will have an Avril style human to service the call. The next generation of Avril however, will not appear as some lip-synched robot style human. No, she will be human in every way in appearance. She will be automated, a robot, but you just will not know when you are talking to the robot Avril or when you are talking to the real one.

The impact of video on banking will be the most radical shake-up for bank operations since technology was first introduced fifty years ago. Bigger than the internet, than call centres, than the ATM, than anything that has gone before. Why? Because online, high quality video connections will mean that, for the first time, a bank will be able to deliver a virtual service experience that is as good as, if not better than, their physical service experience. A real branch on the screen or branch in the hand experience. A real branch experience...but online. Bring on the day.

Chris Skinner is a director of TowerGroup and founder of ShapingTomorrow.com.
Web links: www.towergroup.com and www.shapingtomorrow.com
Author's email: Chris Skinner

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