ErsteGroup_Ara Abrahamyan_(c) Norbert Novak

The chief digital transformation officer of Erste Group Bank, Ara Abrahamyan, talks about how a uniform digital platform can enable seamless interactions throughout different channels and geographies. 

This article is part of The Banker’s Special Report, Digital transformation across European banking groups, in association with Backbase.

Q: What is your digital transformation strategy and how far along in the journey are you?

A: Our objective is to make Erste Group digital to the core. For us, this means using a combination of new technologies to deliver the best value for our customers across our seven markets in Austria and central and eastern Europe.

We strive to grow our digital sales and become an increasingly efficient enterprise with digital end-to-end processes, while ensuring leading compliance, cybersecurity and a digital-minded workforce act as enablers for these goals. And we have achieved our first successes.

For example, we are already recognised for having a leading intelligent banking solution, George. More recently, we established group-wide data analytics capabilities called ‘Erste Insights’, which already support us in advancing our front-office solutions. Still, there is some way to go.

Q: How is it being rolled out across your regional footprint?

A: Depending on the topic, we apply different models employing different ways of working – local, central and mixed. This allows us, as a group, to combine the best of both worlds: advantages of scale and the flexibility of smaller entities.

In addition, we have clustered all existing initiatives into one standardised strategic structure, reviewed budgets, analysed dependencies and identified cross-benefits. For some initiatives, we were only busy with fine-tuning and aligning the roadmaps; for others, we provided start-up assistance so that the project could be put on track quickly and easily. All in all, it is about precise prioritisation, transparency and clear project ownership.

Q: Are you trying to create a seamless and uniform digital experience across multiple countries?

A: We already did that in retail banking. With George, we have the leading digital and mobile banking platform open for external partners and service providers, and are already hosting more than 5.8 million retail customers across our region. Here the goal is to advance the platform’s service offering to make it an even more comprehensive, one-stop shop for holistic prosperity advice.

As for our corporate customers, the group-wide strategic priority is to build a specific front end of similar added value and usability as George. And the implementation has already started.

The reasons [for creating a seamless and uniform digital experience] are not hard to work out. It’s about delivering high quality, the best possible client experience, the brand, and consistency in our offering. Plus, it’s difficult and costly enough to do everything once, so doing it seven times, for each market, would not be smart.

Q: Are there country-specific challenges?

A: It goes without saying that operating in various countries comes with different circumstances. Markets are different, demands are different, regulation is different – for example, EU versus non-EU, euro versus non-euro, approaches to public cloud, or responses to Covid-19 – and the history is different as well.

So, we have to balance dealing with the country specifics as best as possible and leveraging synergies as much as possible. These differences, though, make it exciting. Diversity is fruitful in all kind of aspects.

Q: How are you addressing these challenges and do they influence your digital strategy?

A: As mentioned, the group-wide strategic initiatives can be handled based on a mixed local/central metric-driven governance model whenever necessary. For example, the group-wide strategic IT Progressive Modernisation initiative defines a set of key performance indicators [KPIs] which have to be improved in each country.

However, depending on the local situation, the focus of modernisation activities and the specific targets for each KPI vary for each subsidiary. The digitalisation of back-office processes is handled in a similar way.

In addition, in many cases the local banks address the country-specific challenges through targeted and locally-owned activities.

Q: What would be the ideal solution?

A: This depends on the topic. For customer experience-related topics, it is as stated above: enabling consistent brand promise and seamless interactions throughout different channels and geographies based on a uniform digital platform. For back-office operations, it is about pragmatism and the consideration of local realities, combined with sound economic decisions.

As for the ways of working and our workforce, it is about flexible collaboration techniques, transforming our capabilities based on agile methodologies and strengthening a continuous learning mindset. In the end, digitalisation is never an end in itself – it needs to be done by people for people.


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