Listen: Automation moves up to the front office, Jack Henry’s Foss says
Banks are looking to automation across their platforms to boost efficiency ratios
Automation is moving up from the back office to the front office, where banks are increasingly using automation to interact with customers. The challenge will be to ensure those encounters feel personal, says David Foss, chief executive of financial services at core provider Jack Henry, in this episode of The Buzz podcast.
“I think the shift has happened, which is around the digital platform and how do you automate things on the digital platform,” Foss told Bank Automation News. How do banks employ automation while maintaining a personal touch? “Marrying those two things together and figuring out how to how to be better at both of those … is the challenge that I think a lot of banks are currently wrestling with, and will wrestle with for quite some time in the future,” he said.
Automating the front office is relatively new for banks. It’s only in the last four years that banks have started talking about automation at all, Foss noted. Until recently, banks were focused on the look and feel of the digital experience they were creating.
However, the focus shifted when financial institutions began to look to their efficiency ratio, which measures the ability to use assets to generate income. Now, automation is a CEO-level conversation and a focus for financial institutions of all sizes, Foss said.
Whereas automation “wasn’t top of mind” for banks in the past, “now, it’s a topic of conversation almost all the time with CEOs, because they’re trying to figure out what tools will help them become more efficient and, ultimately, that is usually a discussion around automation,” Foss notes in this podcast conversation.
Bank Automation Ignite, on April 13-14, is the event for inspiring automation initiatives and investment in financial services. At the virtual event, financial services professionals can discover new use cases and technologies that are accelerating automation in banking. Learn more and register at www.BankAutomationIgnite.com.
The following is a transcript generated by AI technology that has been lightly edited but still contains errors.
Loraine Lawson
Good day. This is Loraine Lawson, associate editor with Bank Automation News. Recently, I spoke with David Foss, CEO of the core and financial solution provider Jack Henry, about the company’s role in helping Simmons Bank automate using an open platform approach. Jack Henry described Simmon’s Bank as having a progressive technology strategy. I asked him what that meant.David Foss
Yeah, so I think the, you know, there are two different ways that you can interpret the word progressive, right. So there’s the forward thinking, definition of progressive and then there’s, you know, progressing along the way, kind of rolling out additional functionality along the way. So you’re progressing down a path. The interesting thing is, for me, this the best both definition for progressive I think, apply to what we’re talking about here. So first off, as far as this being a forward thinking, progressive strategy. This is their are several aspects to this strategy that fall into that bucket. First and foremost, the technology that we’ve created is different from what anybody else has in the market as far as a digital banking experience. And it’s designed specifically with the fact that fact in mind that our customers, our community and regional finance, or financial institutions, we buy strategy don’t serve the tier one banks, right, we don’t try to sell to be of a or wealth or bank, or JPMorgan Chase, for example, our strategy is to help our customers distinguish themselves from whatever the experience is that you would get if you’re a customer of DFA or wells or JPMorgan Chase. And the reason is, because our customers have always differentiated themselves on a great customer experience. Our customers have always competed against the major banks in the US based on a great customer experience and kind of that higher touch higher level of service. So the question is, if you’re delivering everything to the digital channel, through the phone, let’s say, how do you continue to distinguish yourself on that higher level of service? Because you’re not the consumer isn’t in the branch, right? They’re doing everything on their own, or they’re doing everything from home? How do you continue to deliver that higher level of service. And so we’ve created this platform that has tools embedded in the platform included in the platform that facilitates that different experience for the for the consumer. So it’s a very progressive idea in that regard. And then beyond that, we have embedded within our application, this open banking philosophy, so that and I’ll use Simmons as an example. Someone decided they wanted to connect other things into our platform from other technologies on theirs. We’ve created this API environment with open connectivity, so that they can go to whoever they want, and you know, whatever tools they want, and they can easily embed those things into our application to deliver a better experience for the consumer. That too, is very progressive other technology vendors out there. Although they talk about API’s, many of them are talking about selling API’s for us, the API is the tool that enables a better experience for the bank and for the consumer, which I believe is also a very progressive thought. Nobody else out there is doing what we’re doing in our in our goal to enable the bank to reach their consumer in a whole different way. And then if you take the other definition of progressive, you know, so this is, this is a variety of, of new innovations, that Simmons bank is rolling out over time, using technology from jack Henry. So originally, for example, they’re only serving consumers and not commercial businesses. So the next phase is to roll out the same type of technology to the commercial business, they added a feature we refer to as demo conversations that allows the consumer to quote unquote, converse with somebody at the bank, through the digital platform. So not not doing a text outside of the application, not making a phone call. But right in the application, we have the ability for them to communicate with their institution directly with a human being at the institution through the application. And they roll that out over time. And so, you know, there’s this nice progressive steps of rolling out the technology that I think also applies in this conversation.Loraine Lawson
So how does automation change for your, in the past year or so, for small and midsize banks? Are you seeing banks automate or no?David Foss
So it probably started. I’d say three or four years ago, you know what, what started to happen was bankers really became more focused on their efficiency ratio. And so that so when you’re really focused on efficiency ratio, and trying to see how you measure up against your competitors, if you’re a banker, well, what is one of those great opportunities that can improve your efficiency ratio and lead to greater efficiency with automation? And so they started to really look at automation tools, and whether they were specifically things like workflow technology, or if it was just new stuff that would make the process smoother, you know, that became a real topic of conversation. And I’ll tell you flat out prior to four years ago, or so, it was almost never a topic of conversation. We never had bankers coming to us saying, oh, we’re trying to figure out how to automate this stuff. You know, we were trying to convince them they should automate, but they weren’t. It wasn’t top of mind. for them. It didn’t. It wasn’t a driver for them. And the decision process, once this shift happened, where they all started to focus on their efficiency ratio. Now, it’s a topic of conversation almost all the time with CEOs, because they’re trying to figure out what tools will help them become more efficient. And ultimately, that is usually a discussion around automation. And so today, you know, through the digital channel, what can we do on these things in the back office, what can we do to automate things, but you know, what, where’s the efficiency play in the way we operate? The accounts and the way we store data and the way we move data around. And, you know, all those things are fodder for conversation today, where like I say, five years ago, we would try to get them interested. You know, we’re a technology provider, we’re all about new technology that will make things more efficient. We tried to get them to talk about it, they didn’t really care to engage that much in the topic of automation. They were more interested in, you know, how does it look? And how does it feel? And you know, is this easy, but it wasn’t about making process better. It was just more about the experience prior to a few years ago.Loraine Lawson
Places where you’re typically looking to automate right now that may be different in two or three years?David Foss
That’s a good question. You know, right now, much of the conversation these days is around back office process. So it, you know, they’re out there looking at all these things were, quote, unquote, we’ve always done it that way, you know, so they do something in the back office, but they just do because they’ve always done it that way. And they’re trying to figure it out. Is there? Is there some way to automate those things in the back office? I think the shifts that you’re asking me about in the future, where will automation be? I think the shift has happened to this discussion you and I started out with, which is around the digital platform, and how do you automate things on the digital platform? I think there’s a lot of runway there. And I think that’s going to carry us forward for quite a while people trying to figure out how to automate their interactions with their customers without losing the service touch. You know, how do you balance that I want to automate things, but I don’t want to lose that personal touch that I have with my customers, if I’m a community original bank, because that’s where my value is, and marrying those two things together and figuring out how to how to be better at both of those. That’s the challenge that I think a lot of banks are currently wrestling with and will wrestle with for quite some time in the future.
Good day. This is Loraine Lawson, associate editor with Bank Automation News. Recently, I spoke with David Foss, CEO of the core and financial solution provider Jack Henry, about the company’s role in helping Simmons Bank automate using an open platform approach. Jack Henry described Simmon’s Bank as having a progressive technology strategy. I asked him what that meant.David Foss
Yeah, so I think the, you know, there are two different ways that you can interpret the word progressive, right. So there’s the forward thinking, definition of progressive and then there’s, you know, progressing along the way, kind of rolling out additional functionality along the way. So you’re progressing down a path. The interesting thing is, for me, this the best both definition for progressive I think, apply to what we’re talking about here. So first off, as far as this being a forward thinking, progressive strategy. This is their are several aspects to this strategy that fall into that bucket. First and foremost, the technology that we’ve created is different from what anybody else has in the market as far as a digital banking experience. And it’s designed specifically with the fact that fact in mind that our customers, our community and regional finance, or financial institutions, we buy strategy don’t serve the tier one banks, right, we don’t try to sell to be of a or wealth or bank, or JPMorgan Chase, for example, our strategy is to help our customers distinguish themselves from whatever the experience is that you would get if you’re a customer of DFA or wells or JPMorgan Chase. And the reason is, because our customers have always differentiated themselves on a great customer experience. Our customers have always competed against the major banks in the US based on a great customer experience and kind of that higher touch higher level of service. So the question is, if you’re delivering everything to the digital channel, through the phone, let’s say, how do you continue to distinguish yourself on that higher level of service? Because you’re not the consumer isn’t in the branch, right? They’re doing everything on their own, or they’re doing everything from home? How do you continue to deliver that higher level of service. And so we’ve created this platform that has tools embedded in the platform included in the platform that facilitates that different experience for the for the consumer. So it’s a very progressive idea in that regard. And then beyond that, we have embedded within our application, this open banking philosophy, so that and I’ll use Simmons as an example. Someone decided they wanted to connect other things into our platform from other technologies on theirs. We’ve created this API environment with open connectivity, so that they can go to whoever they want, and you know, whatever tools they want, and they can easily embed those things into our application to deliver a better experience for the consumer. That too, is very progressive other technology vendors out there. Although they talk about API’s, many of them are talking about selling API’s for us, the API is the tool that enables a better experience for the bank and for the consumer, which I believe is also a very progressive thought. Nobody else out there is doing what we’re doing in our in our goal to enable the bank to reach their consumer in a whole different way. And then if you take the other definition of progressive, you know, so this is, this is a variety of, of new innovations, that Simmons bank is rolling out over time, using technology from jack Henry. So originally, for example, they’re only serving consumers and not commercial businesses. So the next phase is to roll out the same type of technology to the commercial business, they added a feature we refer to as demo conversations that allows the consumer to quote unquote, converse with somebody at the bank, through the digital platform. So not not doing a text outside of the application, not making a phone call. But right in the application, we have the ability for them to communicate with their institution directly with a human being at the institution through the application. And they roll that out over time. And so, you know, there’s this nice progressive steps of rolling out the technology that I think also applies in this conversation.Loraine Lawson
So how does automation change for your, in the past year or so, for small and midsize banks? Are you seeing banks automate or no?David Foss
So it probably started. I’d say three or four years ago, you know what, what started to happen was bankers really became more focused on their efficiency ratio. And so that so when you’re really focused on efficiency ratio, and trying to see how you measure up against your competitors, if you’re a banker, well, what is one of those great opportunities that can improve your efficiency ratio and lead to greater efficiency with automation? And so they started to really look at automation tools, and whether they were specifically things like workflow technology, or if it was just new stuff that would make the process smoother, you know, that became a real topic of conversation. And I’ll tell you flat out prior to four years ago, or so, it was almost never a topic of conversation. We never had bankers coming to us saying, oh, we’re trying to figure out how to automate this stuff. You know, we were trying to convince them they should automate, but they weren’t. It wasn’t top of mind. for them. It didn’t. It wasn’t a driver for them. And the decision process, once this shift happened, where they all started to focus on their efficiency ratio. Now, it’s a topic of conversation almost all the time with CEOs, because they’re trying to figure out what tools will help them become more efficient. And ultimately, that is usually a discussion around automation. And so today, you know, through the digital channel, what can we do on these things in the back office, what can we do to automate things, but you know, what, where’s the efficiency play in the way we operate? The accounts and the way we store data and the way we move data around. And, you know, all those things are fodder for conversation today, where like I say, five years ago, we would try to get them interested. You know, we’re a technology provider, we’re all about new technology that will make things more efficient. We tried to get them to talk about it, they didn’t really care to engage that much in the topic of automation. They were more interested in, you know, how does it look? And how does it feel? And you know, is this easy, but it wasn’t about making process better. It was just more about the experience prior to a few years ago.Loraine Lawson
Places where you’re typically looking to automate right now that may be different in two or three years?David Foss
That’s a good question. You know, right now, much of the conversation these days is around back office process. So it, you know, they’re out there looking at all these things were, quote, unquote, we’ve always done it that way, you know, so they do something in the back office, but they just do because they’ve always done it that way. And they’re trying to figure it out. Is there? Is there some way to automate those things in the back office? I think the shifts that you’re asking me about in the future, where will automation be? I think the shift has happened to this discussion you and I started out with, which is around the digital platform, and how do you automate things on the digital platform? I think there’s a lot of runway there. And I think that’s going to carry us forward for quite a while people trying to figure out how to automate their interactions with their customers without losing the service touch. You know, how do you balance that I want to automate things, but I don’t want to lose that personal touch that I have with my customers, if I’m a community original bank, because that’s where my value is, and marrying those two things together and figuring out how to how to be better at both of those. That’s the challenge that I think a lot of banks are currently wrestling with and will wrestle with for quite some time in the future.
