- Original Poster
- #1
COVID 19 changed the world completely within few months. Many of our professions have been affected by COVID in some degree. From the way we conduct our businesses, the way we interact with our customers, the way we work with our fellow employees and deal with other stake holders have changed dramatically within few short months. Stating service sectors have gone though the most changes compares to manufacturing sector is not an understatement.
Banking is a large and a significant part of the service sector that can be identified as one of the most important parts of the economy. Banking sector is evolving rapidly since the start of the new Century. Apart from performing basic Banking operations such as opening accounts, accepting deposits, and lending banking sector have expanded widely to accommodate insurance services, stock market activities and many other activities for their clients (Ennis, 2004).
Operations manager plays a major role in day to day banking operations in a branch. These includes, staff scheduling, authorization of high value and high-risk transactions, managing of facilities and infrastructure, Vault operations and more. Each element of the operations managers duties and responsibilities have transformed during COVID 19 and became more challenging.
When COVID 19 spread through out the world this created a challenging environment for the banking industry, especially for Branch Banking. These challenges changed way banks operate, temporarily and in some instances permanently. These are few challenges banking operations managers faced during the COVID 19 crisis and how these challenges change the way clients interact with the bank and banks specifically branches conduct their operations.
· Operating Bank branches adhering to Public safety and health guidelines (PricewaterhouseCoopers, n.d.):
When pandemic started and government and public health officials placed various public health and safety guidelines such as social distancing was not so convenient for branches as branch spaces has not been designed to accommodate social distancing. Further branches had to implement other safety measures such as temperature checks, mandatory use of masks and hand sanitizing. Implementing these measures almost overnight was a huge challenge for the branch operations.
By limiting the number of customers walk into the branch at a time branches can mitigate the difficulties related to social distancing. Utilization of internet banking, automated teller, cash deposit and check deposit machines, tele banking can limit the number of customers coming into the branch. Further banks can create a framework through a mobile app or through contact center to give appointment to customer to meet the capacity of the branch and staff.
· Management of non-performing loans:
It is understandable that non-performing loans during COVID 19 have increased all throughout the financial sector. It is a major part of the bank operations management to minimize the non-performing loans. One important fact bank must understand is this crisis is different from many other financial crises we have gone through. NPLs are not occurring due to asset misevaluation or lack of borrower quality. External shock is the key factor for this NPL increase.
The way operations management of branches can deal with this situation is through transparency and constant communication and risk evaluation on the customer, creating an early warning system to identify risks though portfolio analysis, and identifying the requirement for capital generation and conservation through portfolio sales and exit from business segments. By actively identifying and adapting changes bank can face this challenge confidently.
· Staff scheduling issues:
staff scheduling during COVID 19 is a challenging task in branch operations. This made more challenging with the scheduling laws enforced by authorities. Bank branches specially as a customer interaction point critically needs staff to perform day to day activities. Working from home is not the most suitable solution to branch activities as most of the work relates to branches includes meeting with customer in person. Therefore managing, scheduling and rotating staff in various duties can be a complicated situation to maneuver.
Best way operation managers of branches can take charges of this challenge is give employees cross functional training to work on different departments so that branch operations can be managed in a productive and efficient way with reduced number of staff. This is an advantage in the long run as automations and digitalization of the banking activities is already created the atmosphere for multitasking talents to shine (Alam, 2003).
· Maintaining branch premises according to public safety guidelines:
This pandemic changed many aspects of the way we work and interact with each other. COVID 19 changed the way businesses run. Specially with social distancing, sanitization, and personal hygiene, became center of many discussions with regards to handling of businesses. This became a challenge to branch operations management as well. Specially for the operations manager of the branch that had little to do with cleanliness and sanitization related matters of the branches have to involve and supervise more closely the sanitization measures of the branch premises to stay in line with public safety guidelines and for to protect employees and customer. Temperature checks at the entrance, providing sanitizer and facilitate washing hands and most importantly recording the customers walk into the branch can help to mitigate the public health risks.
Further getting more involved with the matters related to sanitization of branch premises and related facilities directly or by delegating the task to employees to oversight these measures can further improve ability to mitigate the risk.
· Handling of Physical Cash and Vault Operations:
Handling of cash is a key and mot basic part of bank operations. During the pandemic due to public health guidelines received from the authorities many bank customers limited their use of cash and chose alternative methods of exchange for their day to day operations. But branches had to accept deposits and dispense withdrawals at customer discretion. Protecting these front office employees that deal with cash became an enormous challenge for the operations managers across the world. Mandatory use of personal protective equipment (PPE) is the only precautionary action banks operations managers could take to protect cashiers.
Public is already rapidly moving towards a future that use less and less physical cash. With electronic fund transfers, extended automated teller operations, and e-cash, use of physical cash is reducing gradually. But when COVID 19 started even most the customers who still used to walk into the branches for deposits and withdrawals tried to avoid handling of physical cash whenever possible. This further intensified the changes that was already happening in the retail banking operations. It is understandable these changes will remain and grow steadily until physical cash as we know someday become obsolete.
As these challenges disrupted the way retail bank branches operated, management made changes to strengthen the branches, and the organization. Some of the changes that we made to face these challenges may reversed back to its previous form after the pandemic. But some of the changes will continue to expand and will be a permanent fixture in the branch operations.
Digitalization of banking will be the most permanent legacy of the pandemic in banking operations. Banking operations such as cash deposits and withdrawals, cheque clearing, opening of accounts, loan requests and many other banking operations are already automated to a certain extent. but with the rise of COVID 19 these disruptive technologies such as internet and mobile banking became front and center of the banking activities compares to the conventional branch banking setting (Callaway and Hamilton, 2008). Even in a post COVID 19 era this change is going to persist.
COVID 19 lockdowns resulted in closure of many bank branches all around the world (KPMG, 2020). Clearly COVID 19 is not the lone factor of this phenomena, but this pandemic clearly accelerated the rate of branch closures. And as the main delivery channel of commercial banking operations branches closed at an alarming rate. Many banks considers to keep the branches closed even after the pandemic due to widened digitalization of banking acrivities. At the same time these changes bound to create a customer segment with no brand loyalty. Staff interaction with the customers play a major role in success and smooth operation of the branches as well as building brand loyalty. Digitalize banking platform may well change the brand loyalty in long run.
Apart of these changes to the bank’s delivery network, most of the back-office functions also went through a vast transformation during the pandemic. specially most banks started working remotely due to lock downs.
Banks all around the world are going through a digital transformation and I believe pandemic accelerated this process and forced the banks to take more forceful decisions in a short period of time.
As a banker these are the challenges and opportunities that I saw and experience during this pandemic. And these challenges certainly changed the way I work in my organization.
How did COVID 19 change your organization and the way you work?
Banking is a large and a significant part of the service sector that can be identified as one of the most important parts of the economy. Banking sector is evolving rapidly since the start of the new Century. Apart from performing basic Banking operations such as opening accounts, accepting deposits, and lending banking sector have expanded widely to accommodate insurance services, stock market activities and many other activities for their clients (Ennis, 2004).
Operations manager plays a major role in day to day banking operations in a branch. These includes, staff scheduling, authorization of high value and high-risk transactions, managing of facilities and infrastructure, Vault operations and more. Each element of the operations managers duties and responsibilities have transformed during COVID 19 and became more challenging.
When COVID 19 spread through out the world this created a challenging environment for the banking industry, especially for Branch Banking. These challenges changed way banks operate, temporarily and in some instances permanently. These are few challenges banking operations managers faced during the COVID 19 crisis and how these challenges change the way clients interact with the bank and banks specifically branches conduct their operations.
· Operating Bank branches adhering to Public safety and health guidelines (PricewaterhouseCoopers, n.d.):
When pandemic started and government and public health officials placed various public health and safety guidelines such as social distancing was not so convenient for branches as branch spaces has not been designed to accommodate social distancing. Further branches had to implement other safety measures such as temperature checks, mandatory use of masks and hand sanitizing. Implementing these measures almost overnight was a huge challenge for the branch operations.
By limiting the number of customers walk into the branch at a time branches can mitigate the difficulties related to social distancing. Utilization of internet banking, automated teller, cash deposit and check deposit machines, tele banking can limit the number of customers coming into the branch. Further banks can create a framework through a mobile app or through contact center to give appointment to customer to meet the capacity of the branch and staff.
· Management of non-performing loans:
It is understandable that non-performing loans during COVID 19 have increased all throughout the financial sector. It is a major part of the bank operations management to minimize the non-performing loans. One important fact bank must understand is this crisis is different from many other financial crises we have gone through. NPLs are not occurring due to asset misevaluation or lack of borrower quality. External shock is the key factor for this NPL increase.
The way operations management of branches can deal with this situation is through transparency and constant communication and risk evaluation on the customer, creating an early warning system to identify risks though portfolio analysis, and identifying the requirement for capital generation and conservation through portfolio sales and exit from business segments. By actively identifying and adapting changes bank can face this challenge confidently.
· Staff scheduling issues:
staff scheduling during COVID 19 is a challenging task in branch operations. This made more challenging with the scheduling laws enforced by authorities. Bank branches specially as a customer interaction point critically needs staff to perform day to day activities. Working from home is not the most suitable solution to branch activities as most of the work relates to branches includes meeting with customer in person. Therefore managing, scheduling and rotating staff in various duties can be a complicated situation to maneuver.
Best way operation managers of branches can take charges of this challenge is give employees cross functional training to work on different departments so that branch operations can be managed in a productive and efficient way with reduced number of staff. This is an advantage in the long run as automations and digitalization of the banking activities is already created the atmosphere for multitasking talents to shine (Alam, 2003).
· Maintaining branch premises according to public safety guidelines:
This pandemic changed many aspects of the way we work and interact with each other. COVID 19 changed the way businesses run. Specially with social distancing, sanitization, and personal hygiene, became center of many discussions with regards to handling of businesses. This became a challenge to branch operations management as well. Specially for the operations manager of the branch that had little to do with cleanliness and sanitization related matters of the branches have to involve and supervise more closely the sanitization measures of the branch premises to stay in line with public safety guidelines and for to protect employees and customer. Temperature checks at the entrance, providing sanitizer and facilitate washing hands and most importantly recording the customers walk into the branch can help to mitigate the public health risks.
Further getting more involved with the matters related to sanitization of branch premises and related facilities directly or by delegating the task to employees to oversight these measures can further improve ability to mitigate the risk.
· Handling of Physical Cash and Vault Operations:
Handling of cash is a key and mot basic part of bank operations. During the pandemic due to public health guidelines received from the authorities many bank customers limited their use of cash and chose alternative methods of exchange for their day to day operations. But branches had to accept deposits and dispense withdrawals at customer discretion. Protecting these front office employees that deal with cash became an enormous challenge for the operations managers across the world. Mandatory use of personal protective equipment (PPE) is the only precautionary action banks operations managers could take to protect cashiers.
Public is already rapidly moving towards a future that use less and less physical cash. With electronic fund transfers, extended automated teller operations, and e-cash, use of physical cash is reducing gradually. But when COVID 19 started even most the customers who still used to walk into the branches for deposits and withdrawals tried to avoid handling of physical cash whenever possible. This further intensified the changes that was already happening in the retail banking operations. It is understandable these changes will remain and grow steadily until physical cash as we know someday become obsolete.
As these challenges disrupted the way retail bank branches operated, management made changes to strengthen the branches, and the organization. Some of the changes that we made to face these challenges may reversed back to its previous form after the pandemic. But some of the changes will continue to expand and will be a permanent fixture in the branch operations.
Digitalization of banking will be the most permanent legacy of the pandemic in banking operations. Banking operations such as cash deposits and withdrawals, cheque clearing, opening of accounts, loan requests and many other banking operations are already automated to a certain extent. but with the rise of COVID 19 these disruptive technologies such as internet and mobile banking became front and center of the banking activities compares to the conventional branch banking setting (Callaway and Hamilton, 2008). Even in a post COVID 19 era this change is going to persist.
COVID 19 lockdowns resulted in closure of many bank branches all around the world (KPMG, 2020). Clearly COVID 19 is not the lone factor of this phenomena, but this pandemic clearly accelerated the rate of branch closures. And as the main delivery channel of commercial banking operations branches closed at an alarming rate. Many banks considers to keep the branches closed even after the pandemic due to widened digitalization of banking acrivities. At the same time these changes bound to create a customer segment with no brand loyalty. Staff interaction with the customers play a major role in success and smooth operation of the branches as well as building brand loyalty. Digitalize banking platform may well change the brand loyalty in long run.
Apart of these changes to the bank’s delivery network, most of the back-office functions also went through a vast transformation during the pandemic. specially most banks started working remotely due to lock downs.
Banks all around the world are going through a digital transformation and I believe pandemic accelerated this process and forced the banks to take more forceful decisions in a short period of time.
As a banker these are the challenges and opportunities that I saw and experience during this pandemic. And these challenges certainly changed the way I work in my organization.
How did COVID 19 change your organization and the way you work?
