An Interview with John Baddiley, Head of Technology Strategy and Architecture, BNZ
"The secret to reinvention is acknowledging that we don’t know everything, and to recognise that every day, and every customer, is an opportunity to learn."
FST Media: Tell us about your technology priorities for 2019. How are BNZ’s digital capabilities evolving in line with New Zealand’s rapidly evolving financial services ecosystem?
Baddiley: We’ve got a strong focus on industrialisation and pivoting the organisation towards a faster pace of change. Globally, the financial services sector is starting to see the sort of disruption that has impacted many other industries, and our relevance for our customers is driven by a number of factors: our ability to understand what they need and to provide advice and products to help them be successful; our ability to recognise that these needs are not going to be consistent for all of our customers; and, our ability to provide all of these at the right value point for our customers. There will be three types of banks: the innovators, the fast followers, and the increasingly irrelevant. In this context, we need to be able to pivot and respond to new customer needs a lot faster than we have in the past.
FST Media: There has been much discussion within the industry around banks achieving speed-to-value. How does BNZ continue to reinvent itself and remain at the cutting edge of digital innovation?
Baddiley: As I mentioned above, we know that the pace of change demanded by our customers has increased. For our customers, the expectations of how they’ll interact, and what those interactions will look like, are increasingly being set by other industries, not our traditional competitors. Over the past three years, we’ve been transforming the way that we deliver change across the bank. Agile and DevOps are a part of this, but we’ve also recognised that the products and services that we provide need to be different as well. Digital is not a façade that you can place over a product that hasn’t significantly changed in decades; a digital bank is one where the products are built to be digital from the ground up. If banks just put a digital frontend on an otherwise analogue product, the old skeleton will show through – whether it’s from backend processes and systems that aren’t effectively integrated, processes that require manual or paper-based intervention from customers, or processes that made sense 30 years ago but don’t obviously add value now.
The secret to reinvention is acknowledging that we don’t know everything, and to recognise that every day, and every customer, is an opportunity to learn. We need to listen to our customers and meld the best that we’ve got with new ideas from inside the Bank and from our partners. Finally, we must never forget that something that works well now can always be improved.
FST Media: Cloud technologies are often touted as the critical enabler for financial services to innovate at scale and speed. How is cloud being utilised at BNZ to elevate agility and enhance customer experience?
Baddiley: For the past year we’ve had a cloud-first policy. There are three primary benefits of the cloud: the cloud gives us the ability to scale our resource consumption up and down with demand, to experiment without having to commit to large-scale capital investment; it provides us with technology and enterprise agility to pivot quickly; and, it provides capabilities that are either not as capable on-premise, or not available. We’ve seen great promise in capabilities such as natural language processing, and the integrations of them into staff and customer applications across all our channels.
FST Media: Last year, BNZ adopted facial recognition technology to enable new customers to apply for a bank account by simply uploading a video of themselves. How does the bank plan to grow its digital ID and biometrics technology to further enhance value for customers?
Baddiley: Biometrics provides an opportunity to both increase security for the Bank and our customers, as well as making security – including regulatory activities such as KYC – a lot easier for customers to participate in. We see many activities where biometrics could offer benefit; but, at the same, time we need to maintain an ethical focus at all times. These types of technologies need to be used with the informed consent of customers, and we must maintain the privacy of the information that the systems generate.
FST Media: On a scale of one to 10, what is the current level of customer trust towards digital ID? How do you educate customers about data security?
Baddiley: I don’t think that most customers think about digital ID in terms of trust. Trust is an earned attribute, and the trust the Banks have relates to their past behaviour and performance. This is an interesting aspect as it relates to open banking. Open banking involves customers providing informed consent for their information to be shared, and I don’t think that the industry or government is doing a good enough job of helping our customers understand the implications.
Our success will be driven by proactively educating our customers. At BNZ we do this through our award-winning Digital Gurus program and activities such as our Scam Savvy week (being held between the 26 and 30 August). And, obviously, by proving to our customers that we can be trusted with their data by delivering world-class cyber protection.
FST Media: What lessons and insights do you hope to impart on your audience during your upcoming presentation at Future of Financial Services, Auckland conference?
Baddiley: The way that Know Your Customer (KYC) regulations are implemented by many banks has been one of the more annoying processes that customers have to interact with; they need to bring proof of identity, proof of address, and they have to come into a branch. And, if they’ve got the wrong documentation, they need to come back. I’ll be showing how it’s possible to take a new customer through a joining process in minutes, in a way that meets our regulatory obligations, at a time and place of customers’ choosing. And I’ll be talking about how industry and government need to work more closely to make valuable regulatory processes, such as KYC, a foundation for a true NZ digital economy. ⬤
Learn how BNZ is leveraging next-gen digital ID technologies to create NZ's most seamless customer on-boarding journey. Don't miss John Baddiley's featured keynote at the Future of Financial Services, Auckland – 1 August, 2019. Limited time remains to register! Click here to secure your spot.