Bank Ekonomi’s Operations Director and Chief Operating Officer speaks with FST Media about how the bank is harnessing mobile platforms to engage with a growing millennial customer base.

FST Media: What are your IT investment priorities for the next 12 to 18 months?

Cheung: Our key priorities are to be customer-centric, to help grow revenues, streamline processes and invest in combating financial crime. In the first two categories we created Project Cheetah to support tracking market insights that are accessible by all branches and all staff involved. Wherever there are inefficiencies, focus groups will address them on an ongoing basis. Since 2013, we have invested a lot in combating financial crime under a program called Global Standards. It is a trend we believe will become more common in Indonesia and many other countries, and we are proud to be leading in this space.

FST Media: What technology or innovation will be a game-changer over the next five years?

Cheung: Digital, especially mobile, will be a game changer in financial services over the next five years. Big data and recognising individual differences in sales and service processes will also be key. What changes the game is by nature somewhat unknown for us now, but it will certainly be something with a new angle and something that fundamentally did not exist before. Over the next five years, we need to become more attuned to our customers’ experience. We also need to develop a partnership with what conventional wisdom considers as our traditional enemy or rival – whether it is a bank or non-bank competitor.

FST Media: How is Bank Ekonomi harnessing the potential of mobile platforms to engage with a growing millennial customer base?

Cheung: Currently, our mobile banking capabilities share the same infrastructure with internet banking, providing the same security but with a lower cost of development. The initial trend that we have been observing in the mobile space was that by 2015 most customers will have a smartphone. Current penetration and active ratio is solid, but we aim to grow annually by 40 per cent, so that by 2017, it becomes a sizeable and effective platform for interaction with our customers. By that time, the balance between branches and internet and mobile channels will reach a new chapter. Perhaps a branch will not only be for sales, but also to provide service. Self-service and digital channels can provide not only service, but can also support more sales for our millennial customers.  

FST Media: What’s next for Dream CareInvest and how will it deliver value to the business?

Cheung: We do not manufacture Bancassurance products, our partnering insurance companies do. We are always looking for better and broader products. They need to be customer-centric to fulfil customer’s needs and wants. There is no product name yet, but it will probably evolve along family-value lines, as family is what people value the most in Indonesia. It may be a flexible combination of protection and investment that can change during the life cycle of the product subscription. After all, insurance is a business about uncertainty.

FST Media: How will wearable devices and telematics change the future of insurance?

Cheung: Conforming to industry standards around wearables and overseeing their widespread adoption in a sustainable fashion are real challenges for us at Bank Ekonomi. Gadgets will come and go. Some will stay, but those that stay will be very few. With wearables, using a framework for capturing useful data and using it to help prevent health problems is no longer a pipe dream. In this way, wearables can help us lower the claims as well as premiums that our customers are faced with. 

FST Media: Do you consider payment disruptors such as AliPay and ApplePay to be a threat or a potential partner?  

Cheung: Though both are in their embryonic stage, I think it could be a game-changer for us if we were to see AliPay and ApplePay as partners, given their strong brands and subscriber bases. Regulators and the industry more broadly may resist these disruptors, but ultimately consumer expectations will prevail. I firmly believe in the mantra that if you cannot beat them, join them. Some banks can see it in different ways from others, so it is highly likely that some banks, especially the challenger banks, who have a less capital-intensive investment can readily adopt and partner with these disruptors. Such partnerships will be largely impaired if regulators do not provide support. This is something I always recommend the technology inventors bear in mind.

FST Media: How will you use data analytics to deliver a seamless customer journey?

Cheung: A seamless customer journey is an aspirational goal and it will be a long journey. The first phase is to analyze the correlation between the customer experience as business performance, to see if it really is about the way we serve the customers, or if it is about internal hurdles. The results will help us prioritise resources, either in innovation or in streamlining our processes. The insights that we gain from data analytics are powerful, as they tell us which levers to pull in a more frequent and dynamic way. Being able to respond to a subtle market change one day before the competition can be a huge advantage. The key challenge is how an organisation aligns themselves to help enhance the overall customer journey.  

FST Media: Where do you see cloud adoption in financial services over the next five years?

Cheung: Hybrid cloud is the way to go. The adoption will be ten-fold. There are still gaps, in actuality and perception, between the “promoters” (mainly IT firms) and “users” in terms of security and cost and benefit ratios. A recent study in Indonesia showed that the awareness at CXO level is shockingly low. Whether they are being humble and would like to be prudent about it, or the promoters have done a poor job, remains to be seen. Certainly, it is something everyone agrees will come, in whatever form and however disruptive a manner.

Indonesia’s banking landscape is over-bank and each bank prefers to have its own platform to feel secure. This contradicts the real benefit of having cloud technology, but once the cost benefit is realised, it will be quickly adopted. Depending on risk and cost appetite, I think most will prefer some form of hybrid, with the more courageous financial services organisations going all the way.

FST Media: How do you encourage a culture of innovation in your team?

Cheung: To encourage a culture of innovation, I strive to lead by example and have the right rewards in place for outstanding attitudes and behaviours. One key factor is to secure funding. We have a program called Kirana to encourage employees “speak up”. In this program, every employee is connected and can comment as they would on social media. The best ideas will be given attention and funding. This is the sort of democratic environment that employees enjoy but, like true democracy, it needs education and leadership to nurture it.

FST Media: What is your most effective customer acquisition channel and why?

Cheung: Unfortunately, our most effective customer acquisition channel is still our branches. This is due to legacy behaviour that will take some time to change. We aim to grow the penetration and active acquisition ratios by 40 per cent per year. It is not an unrealistic target, given that the whole of the Indonesian market has had a lot of education, led by the big banks. By 2016, we predict that medium to small banks will not need to promote it, as customers will actually demand it. Worse still, if banks do not meet the demand, customers will move. Brand loyalty will undergo a test when technology delivers its promise. If banks want to keep their franchise they must follow the latest technologies and make the most out of them.

FST Media: What will the role of the CIO look like in 2020 and to what extent will technology shape this career path?

Cheung: In 2020, the CIO will be the ultimate business partner. They will sit in various business forums, listening and contributing. They will help business deliver their vision faster and stronger. The line between head of technology or information systems and business development will become blurred. Similarly, if the business wishes to work with their CIO, they should also change their mindset and recognise that IT is no longer an “order-taker”, even though ultimately IT must have robust delivery and SLAs that they are accountable for. It will about who has the merit, not just what their job title is.

FST Media: Every leader has a legacy they wish to be remembered for, what is yours?

Cheung: I want to be remembered as a balanced leader who encourages a culture of diversity and does not create short-term success at the expense of long-term sustainability. Someone who is remembered for his human touch and caring for humanity. Although technical and perhaps with limited ability to appreciate other way of thinking, I am someone who is conscious of my own limitations and am willing to reach out and collaborate.