- How Banks Enhance their Digital Experience
- How to Achieve a Successful Digital Banking Transformation
- Why Hyper-personalization is the only way in the digital age
Zoria Halm (00:04):
Good afternoon, thank you for joining. We're going to host the customer experience track journey to modern digital experiences and with us. So you know what? I'll do a quick introduction about myself. My name is Zoria Halm. I'm the SVP for financial services for Amdocs in the Americas. And with me are Sonny and Katie, but I'll let you guys introduce yourself.
Sonny Sonnenstein (00:36):
That's me. So Sonny Sonnenstein, good afternoon. I'm the CIO for Consumer Business and Digital Banking at M&T Bank. I've been there about five years. Prior to that I was the CIO of Equa Bank out on the West Coast for five years and been in the industry ever since I could, since I was a summer intern at Chemical Bank in 1986. There's a blast from the past for those of you who've been in the industry a while.
Katie Pagenkopf (00:59):
My name's Katie Pagenkopf. I work under Amdocs with Zer. I'm part of the consulting arm of Amdocs Stellar Elements, and we work with financial services companies to help them better deliver product experiences through digital channels to their customers.
Zoria Halm (01:19):
So Sonny, you're our guest of honor and M&T has gone. We talked before this, so we're sort of, we know a little bit more, but when we talked before, you shared a lot about the digital journey that M&T went through over the past two years or so. And so maybe you want to give us a little bit of background and share about this journey that you guys are going through.
Sonny Sonnenstein (01:44):
Yeah, we've been, I'd like to say M&T was a typical stodgy conservative East Coast bank. I get to say that I lived in Portland for five years in which was a very progressive West coast bank and we really set about, I'd like to say we're building the soul of a software company inside the heart of a community bank. So we set about, and Tim Welsh said it before, he called it a digital and human, I call it human-centric digital banking, but the same concept and we said about building our capabilities around understanding customer experiences around agility and around really creating differentiated experience for our customers. So we hired our first chief customer experience officer. We brought in a whole new tech team, and this starts about five years ago when we pivot to agility, over 300 teams now working in an agile fashion. And it's really been rather transformational. We've been able to create some rather distinctive digital experiences while also candidly dealing with a lot of legacy, the need to modernize the foundation, so modernizing the foundation, creating the ability to integrate and then creating those innovative experiences. So it's been a wild journey so far and I think we're just scratching the surface of where we can go.
Zoria Halm (03:09):
So maybe when you talk about this digital journey, you're heading technology and you talk about building this infrastructure, what would be the key building blocks to build this transformation to make? Maybe just to enable the customer experience that you're looking for
Sonny Sonnenstein (03:28):
And it starts with that customer experience and understanding it when you understand they're not getting a mortgage, they're buying a home, and that they start looking for that home two years before they first apply for a mortgage and that their moment of joy and truth, the moment that matters is actually when they turn the key, not when they sign the 800 pages, we make them sign on a mortgage. So when you start with that, you start to think about, well, how do we create better experiences? And I like to say we integrate to experiences. We don't buy everything. We don't build everything. We try to find the best building blocks that are fit for purpose and use them. There's a couple of key ones. We're really working on hard right now because revamping the entirety of our online and mobile banking replatforming from the ground up. And a big component is our identity. We feel identity is the key to better experiences. We learn that a lot of people have aging parents. They need the ability to look at that in a certain way and have certain rights and privileges against that. They have children, they want to get banking accounts. I think Tim, you were talking about bringing your daughter in. What if you had a way to both track and monitor and maybe even restrict certain activities?
(04:39)
So identity is a big part of it. Our integration capabilities, so a PS, so we're using financial data exchange and we're going to be able to work, we work with all the aggregators and fintechs. We're even using it for our own innovation. So we've built some of our own digital startups, if you will, that we're actually kind of about to. Some of them may spin out, some of them may stay with us. That's competitive advantage. But all those are the key things. Again, that middle layer, the foundation has to be there. You got to run your core platforms, you got to do all that stuff. But if you can integrate and create experiences, then you've got something and you can start to really pick your spots. I mean we're big, we're the 11th largest commercial bank, but we're not super big. We're not chase spending 15 billion a year on technology. So we got to pick our spots and I think this focus on customer experience really allows us to do that.
Zoria Halm (05:28):
So when you talk about the customer experiences and like you said, you'd like to focus because you can't be everything for everyone. So what would be the areas that you would focus on?
Sonny Sonnenstein (05:43):
Well, I think we've focused on just the core experience. Tim was saying it well, it has to be, trust is based on reliability if you will. That experience is what you want and then how much self-interest do you have? So our core experience is designed to be easy, simple. We find that that's one of our principles in what we're doing in our digital. But then we're also building specialized things. We've done a couple of interesting things. One is we've partnered in Buffalo, we're building a tech ecosystem. So we took the largest tallest building outside of New York state, put 330,000 square feet, 1500 technologists in there. And we're working with the ecosystem and we have a startup 43 North. They make investment venture investments. And so we partnered with Magnus Mode to be the first bank in the US to put digital flashcards for folks who have cognitive challenges that are on the spectrum.
(06:38)
And it's a really neat use of digital and actually even our disability advocacy network, which is a resource group actually with some of the folks, their family members actually helped design and really create that customer experience and those cards for, I'm going to the A T M for the first time or I'm coming into a branch to do a check and it shows them the cards. So that's an example of a group that maybe of customers that don't normally get served by banks, where we leaned in the other space, we found a niche, we did a bunch of customer research and businesses and we found law firms can't have trouble managing escrow, really hard IOLTA accounts if you've been in the industry a while, right? Really tough. We have a core platform that can do it, but we created a startup called Noda. Basically on top of that, using our customer experience technique using modern, it's really, really lightweight and it gives them the ability to actually better manage the client's escrow and it leads to a set of, actually we're now pivoting it to a bank for lawyers. So those are examples of where we see opportunities to not just serve everyone, but also serve specific segments or targets.
Zoria Halm (07:51):
These are good examples. And I know Katie, you're also doing a lot of research and talking to consumers globally about the type of unique digital experiences and unique digital services that they're looking for. I don't know if you can share maybe a little bit of that.
Katie Pagenkopf (08:08):
So what I like in what Sunny is saying is it sounds like the end user, whether it's a set of lawyers who are trying to better manage escrow or someone with autism, it's the customer experience that is leading the technology, the build and the business. Because when I work with clients, they seem to understand that for consumer banking, an account balance page, we know what that should look like. We know what a transaction detail page should look like. Those are commoditized experiences. What is differentiating for banks is examples like what Sunny is talking about.
Zoria Halm (08:54):
Okay, good. And so Sony, you gave two great examples about law firms and about customers with disabilities. How do you choose the right segments that you want to go after? And I'm sharing because when we talked before, you were very focused on the community
Sonny Sonnenstein (09:18):
And that's very much Yeah, Tim was talking about that too, that it's about helping our communities. M and T's, we like to say we're community bank at scale, we're over 200 billion of assets now. We're pretty big, but we still show up in our local communities in a meaningful way and really getting to understand who those folks in the community are. And we do have some segments of focus. So like in business banking we've identified a couple of, we call them passionate providers and aspirational achievers and we have personas and we understand who they are and what they're about. My wife is actually a passionate provider, a recovering banker, doing a gift startup if you're ever interested. I think that's the key to understanding the community is to understand a bit about you serve everyone, but you've got to find when you design digital experiences, when you design in branch experiences, contexts that are natural language IVR, you've got to think about who that customer is that's using it and understand the nuances.
(10:22)
If you've got power users who use your IVR and you're now giving them voice and they don't get the numbers the way they used to, they're going to be pretty upset. Maybe an example that could have happened. And that's why I think it's so important to know your community, to break it down, to really spend the time with your customers and then start to think about the solutions, the products and services and then the technology behind that. When you start with the technology and you start looking for a solution, then you don't usually get to the outcome you want.
Zoria Halm (10:52):
That's good. I know you've done a lot of research on personalization and trying to segment different markets. I don't know if you want to share or talk about that for.
Katie Pagenkopf (11:01):
So thinking about not starting with the technology but starting with the customer. So I like to point to an example. I was doing research last year, a wife and her husband in their mid fifties, they had just shipped off their youngest son to college and had sold their home, purchased an RV, so they were going to live the motor home life and it was about three or four weeks after they had closed the sale of their home and were getting ready to head off to the campground that they got a piece of mail from their bank recommending they refinance their mortgage. So she was a bright gal, a professional and was pretty sure it was just marketing mail, but was so concerned she did call her bank to make sure that there wasn't something wrong with her closing documents. So that's an example where I would love to see the customer experience lead and the technology follow. So with personalization in that case, you're not adding anything, you're actually taking away a customer touchpoint that is in that case alarming.
Zoria Halm (12:22):
I'm happy to share an experience that I had which well actually an experience I didn't have. But we talk about personalization of service and how a lot of banks, and I don't bank with M&T, so it's not a criticism of M&T at any rate, but I do bank with quite a few others. I'll get to you after the session. But anyways, I live in the Dallas area and we experienced severe weather from time to time and a few weeks back we had a major storm, gulf size, hail, golf, bowl size, hail. The entire neighborhood was trashed, all the roofs trashed. I had one car totaled, another car was almost totaled, like severe damage, broken windows, broken skylights, everything. The next day the insurance company calls roofers are knocking on the door like crazy. Tow trucks are circling the neighborhood offering their services.
(13:25)
And all of my, I don't know, 10 different banks, crickets. Now you would think they should know about it. This is public information. At least three or four banks have branches in the neighborhood. They were impacted, their branches are trashed. You would think that they should offer their customers, they have my address, offer them, do you need something? Do you need maybe a loan or something to fix your car? To fix your roof to do something. And I think a lot of this, we talk about personalization, but a lot of time people are thinking about the data that they have within their systems and are forgetting to look at the broader sources of information that are out there. Whether it's social, I don't know, social or just the news or weather, whatever it is. I don't know if this is something that you guys are working at looking at.
Katie Pagenkopf (14:22):
Go ahead. So I was going to cite that research from Boston Consulting Group. They published it in 2019. They didn't explain their methodology but they asserted that for every a hundred billion of assets under management, banks were missing out on $300 million in revenue. And I think that your examples is exactly that. So why not use something as simple as the weather report to connect with your
Sonny Sonnenstein (14:53):
Well I think you should come to M&T and a good example. I mean I think being a part of that community, being there.
Zoria Halm (15:01):
I'm writing down.
Sonny Sonnenstein (15:03):
But you'd have to come live. We have the blizzard I think most of you probably saw right around the holidays and that's when you're there for your community. That's when we opened up our main building and fed all the workers who were trying to clear the streets where we got out there, opened up where we could our branches and let folks in. And I do think, and Tim was talking about that too, that it's still, the branch is still relevant. We use digital techniques, we do digital appointment setting, we do lots of stuff. Tim was talking about co-browsing, that's all good, but it's still a connection point. It is why aren't we eating dinner there I think was the comment, right? They're there and they're a part of our community, but we can certainly get outside those walls and do more. And I think we try, sometimes we succeed, sometimes we could do even more.
Zoria Halm (15:56):
So Sonny, when you talk about using data and we talk about using data and using data for personalization, I don't know what you can share about how you're leveraging the data about your customers to personalize the services.
Sonny Sonnenstein (16:12):
I think it's for a lot of us we're on the path. Most of us we're using it in some cases we're doing, we focused on that. I talked about that. Buying a home journey. Well one of the things we learned is we could probably use data to better anticipate when folks might be looking to refinance based on the rate environment, based on lots of different factors. And we were able to use that to improve our recapture rate, the folks who choose to refinance with us. But there's also just little nuance things too, just knowing that someone's got a couple of NSFs in a row and reaching out to them proactively and saying, Hey, is there anything, let's talk about this. Let's make sure. So I think we're still like most banks probably just scratching the surface of what that could look like. But I think, and there's a point at which personalization gets a little almost creepy. Have you all had that experience? You're surfing around the web and you've kind of get another ad and another ad. Right now I'm getting Taylor Swift and her cats on TikTok anywhere I go, I'm getting that. I don't know why.
(17:20)
So I think it's definitely where we're headed and I think AI is obviously going to help us with that too, but it's also, I think we have to watch the hyper-personalization to where it gets kind of over that edge. So I think it's going to be an interesting thing to watch over the next three to five years.
Zoria Halm (17:39):
Anything to add?
Katie Pagenkopf (17:40):
So I was thinking about a conversation I recently had with a client where she was explaining to me that the customer experience group that she leads, she thinks it should merge with the cross-sell group. And she was explaining to me she's seeing how customer experience and cross-sell are essentially both driven by personalization. And so as we were kind of working through this problem together, where we got to was that we as business people may think we're cross-selling or upselling to a customer, but more often than not they are looking for help in navigating a product array or figuring out what experience is best for them. And so it's actually less cynical I think, than we normally assume.
Zoria Halm (18:38):
So I want to touch about one of the things that you and I talked about was data AI. These are all emerging technologies or becoming very dominant, but they require a lot of technical expertise and especially for those, this is a challenge for everyone. Everybody. But smaller banks are probably facing bigger challenges in this. And you guys are a fairly large bank, but you're also located in Buffalo, New York, which I still need to relocate to get an account with you guys, but how do you tackle this, call it demand for technology expertise and building the infrastructure?
Sonny Sonnenstein (19:23):
Yeah. Well when we set out about five years ago on this transformation, we said there was three pillars. There was capabilities, making sure you have the right technologies, the right underpinnings, ways of working or agility. And that's all well and good. But the most important pillar of our transformation was talent. Not just for M&T Bank but for western New York. We have a hub in Wilmington now we're in New England for our communities as well. We knew we announced we're going to hire a thousand technologists over the course of five years, but we knew we'd have to build some of them too. So we started a number of different, we revamped our experience recruiting pretty significantly and focused on 14,000 computer science engineers who had degrees from schools in western New York from 98 to 2008. And to bring some of them back, we call them boomerangs.
(20:20)
And we focused on campus and we built our technology development program. We hire 60, 70, 80 computer science engineers out of local schools. I'm the campus ambassador for UB University of Buffalo, and we hire some of them right out of there and other schools within our footprint. And then we also started some, we've done data analytics bootcamps in the community to take folks through bootcamps and actually have them land not just at M&T but six or seven other major employers in the region. And then we started, we still run some old school mainframe type stuff, which still runs great, but we need more people. So we've built, we partnered with IBM and Franklin apprenticeships to build the ZDPR, Z development program. It's a two year program where year of apprenticeship and that we're taking dental hygienists, correction officers, hairstylists and turning them into mainframe assistant programmers and developers. And it's really those kind of, I think and that last piece, those on-ramps, creating more on-ramps into technology, into customer experience will be the thing into data will be the thing I think that drives our communities forward. And that's something we're certainly trying to do in our home area of western New York, but also across the footprint.
Zoria Halm (21:37):
That's a great answer. I really appreciate it. And I think that technology talent is a challenge. It's a bottleneck. It's going to continue to be a scarce resource. And so being able to manage that or to nurture that within your community is a great thing for you as a bank and for the community. So I think it's very symbiotic.
Katie Pagenkopf (22:03):
Well, and I'll add, if anyone heard Andrew Yang earlier, he listed off the top five sort of industries that people work in. It was like food and hospitality and none of them were what Sonny was just describing. But what M&T is trying to do was kind of exactly Andrew Yang's point was that we need to plan for the future and we need to reeducate and sort of retrack people who are in hospitality or in these other industries that AI and technology is going to minimize the number of roles in.
Zoria Halm (22:47):
I think we talked about all the great things you guys are doing. What isn't working, what challenges are you facing that you're struggling with?
Sonny Sonnenstein (22:58):
I think I describe what we're trying to do to really understand, I joke with my chief customer experience, officer Arthur, she's journey led, I'm agile built, we do a little standup routine together. And I think getting all that right on top of a technology foundation that's still being modernized and we're all in this same boat on top of the realities of our industry and some of the things even recently that have kind of driven us to a reminder of what the fundamentals of the industry are about in capital, liquidity and profitability. This is hard. This is an advanced transformation. It's not simple and I think it's a lot of two steps forward, one step back. I think that's the hardest thing that's been to, I like to say we're changing the beliefs, behaviors, and practices of an entire company. Just the mindset. We're just asking everyone to change their religion basically.
(23:55)
And to do that you're going to have to highlight the successes, but you're also have to be the honest about the failures and saying that was, I think I had something about a month in where the CEO asked me to do something about a leaderboard or something and I was new, so I said I'll try it. And month in I went up to him and we talked about it. I said, well that was a spectacular failure. What did you really want to do? Because obviously whatever I had my team put together wasn't what you were looking for. So it started right off the bat and I think that surprised him that that was the way I came into that. But what it was was a miss in his expectations of what he had seen something at Facebook and he wanted. So I think it was just a good reminder that we're going to stub our toes a whole lot and systems go down. There's all sorts of things that happen, but if we have a purpose in mind and a vision, we can usually ride ourselves. And it may not be a direct line, but at least we're moving in the right direction.
Zoria Halm (24:55):
That's good. Anything else you want to add before we open it for questions? Okay, so questions from the audience. Go ahead. Well.
Audience Member 1 (25:12):
We heard a counterpart of yours earlier today from Truist about things like enterprise wide CX layer. Do you think about things the same way? How do you think about what should be owned by the enterprise versus where you should be looking for help and kind of discuss that balance?
Sonny Sonnenstein (25:29):
Yeah, I think when you think about, in fact, I was just looking today at a design for the next generation of our ATMs and it's going to be very consistent with how we're revamping our online and mobile banking and very consistent with look and feel. So I think there's value in having a design system, if you will, having a way you want to build things and design things, but you also want to have that local autonomy to be able to move quickly to meet those specific needs in that particular area. And I think there's a healthy balance you need to kind of find there. I think it actually, and even having that kind of consistency and design, it takes some of the, I don't have to choose what this button looks like or I don't have to choose this or that. I can focus on what is, and it's all designed back to that, what is that customer or employee experience I'm trying to engender what makes it easy or hard and then kind of working through that. So I think we do have a central kind of design team, but we also embed UI, UX and CX folks in a lot of the key areas where we're driving, like revamping our online and mobile banking the right, it's the third leg of the stool, it's the business, it's technology and it's designer CX. So I don't know if that's.
Audience Member 1 (26:51):
Yeah, it sounds like you're more about style guide and consistency rather than dictating top down enterprise experiences where you might need some flexibility on the business units.
Sonny Sonnenstein (27:03):
And we did map kind of the journeys in each of the lines of business and so we know where the intersects are and overlaps are. So we know that our business banking and clients and commercial clients both use some of the same services somewhere. We're looking at an onboarding journey for say treasury management. We're really trying to make sure we're looking at all the different types of customers who might go through that experience from a really heavyweight Fortune 500 company to a very small business who happens to have rather sophisticated cash flow management needs for example. So I think you don't have to have a consistent hundred percent consistent frame, but if you understand where the intersect points are, I think that's key.
Zoria Halm (27:46):
Maybe if I can just add one just to compliment what you said and I think trying to take the consultant view, it's a question that comes up not just for design but for basically any corporate function. You can look at it for technical design, customer experience, design for quality, anything that goes across the enterprise. Historically everything was centralized and there was this shift to agile, we need to break it up and distribute it to all the units in the organization. Everybody needs to be agile and independent. And what we see now as the organizations are call it maturing, there is an understanding that there is a critical role for a central function to at least define the guidelines and then give the individual units the agility. And for me at least it goes across any domain, whether it's customer experience or just technical architecture. But just my observation, I think there was another question over there.
Daniela (28:47):
Hi, my name's Daniela. I actually used to work at M&T Bank. I did the M D P program and was based in Wilmington. I've worked on the Wilmington Trust side. I'm now with Visa and one of my core passions is brand strategy and marketing. So I would love to hear a little bit about how you go about positioning yourself as a brand when you're trying to cater towards this idea of everyone in a community, but also these specific niches that are underserved.
Sonny Sonnenstein (29:19):
I wish I had Francesco, my chief marketing officer right here with me, but I will say we do a lot of research around brand is two sides, what you want to convey and then brand promise has to be matched by what people actually feel about your brand. So I think we've at that, we've landed on understanding what's important and that as a base has a lot of interpretation, understanding what's important to a small business, understanding what's important to a family, sending a child to college, understanding what's important for a high net worth family that's looking to create some sort of charitable trust or something like that. So I think for us, that brand is about being there for our customers, understanding what's important, being there in the moments that matter. And I think I can see my work in that brand every day. I think folks in the branch, the folks wealth advisors, whoever they are, commercial RMMs, they can see themselves in that work. And that's how you get to a good brand where everyone can look at it and say, all right, I see what I do and how I support our customers and clients in that. So we'll keep evolving it I'm sure, but.
Zoria Halm (30:43):
I'm looking at our time cop, do we have time for another question? Okay, excellent. Please.
Audience Member 3 (30:52):
There's bee lot of talk over the last few months about AI
Audience Member 2 (30:55):
And just one, just wondering how you think about that impacting your digital customer experiences and how you're going to leverage that going forward.
Sonny Sonnenstein (31:03):
AI, it's artificial intelligence, right?
Audience Member 2 (31:07):
I think so.
Sonny Sonnenstein (31:08):
Yeah. I remember I took an AI class back when I was in business school and I won't say how long ago that was. And we called it expert systems and it was mostly logic and trees and kind of basic mass. And it is pretty incredible. I mean I sent my wife before we went on our vacation in February, lovely little text that was a little longer than usual, I just put into chat GPT, I said getaway, Dominican fun wife. And it said this lovely thing and my wife was like how thoughtful. I had to admit to her that I was using chat GPT to help me be more thoughtful. I'm not sure that was a smart move, but it's what I did. I think we are going to have to be really thoughtful about how responsible ai, I guess is the way I would say it.
(31:59)
I think we're going to use it to make transactions and interactions have less friction. That's going to be real positive. I think we're going to use it to drive to better insights. I think we're going to use it to probably help ourselves. We haven't talked about risk compliance yet today in here to maybe meet some of those obligations in different ways by I interpolating documents and comparing it to application. I mean there's all sorts of possibilities, but I think fundamentally we are going to have to figure out how to keep the humanity in it too. It's not talk to my bot, it's talk to us. And I think the bot might front end some of that, but there's also probably a human there. Tim was talking about co-browsing now that could maybe be enabled. We could spot using AI when to do that co-browsing when someone might be having trouble and maybe recognize it sooner and be more proactive. So that's where I see AI kind of really, it's kind of bleed into everything. A lot of the way we design experiences, the way we interact. But hopefully we'll find that way to use it responsibly and for I guess for good, not evil.
Zoria Halm (33:14):
I just want to, I'll share my one personal comment about ai and I think we're all drawn to the more, I don't know, attractive use cases with AI that have human interaction, but these are also the more risky and the ones with the, it's much more challenging to get those rights and not have the pitfalls that we're all talking about. There is so much room for AI in the back office with automating processes, just automating mundane internal processes to drive so much efficiency that I know it's not as attractive and interesting and fun, but probably can bring as much value with much less risk. And so at least just my personal view is there's so much more to do with AI that has less risk. Anyways, I know we're out of time. I want to thank you. Thank you Sani. Thank you Katie.
Sonny Sonnenstein (34:12):
Thank you sir.
Zoria Halm (34:13):
Really appreciate your time.
Sonny Sonnenstein (34:15):
Thank you.