To meet the ever-changing needs of people, organizations need to make customer experience the starting point for product design. They should understand what the customers want and seize every opportunity to make them happy. Such a rationale has paved the way for the growth of design thinking across many industries.
Design thinking is an iterative technique that involves an in-depth understanding of the individuals for whom we are designing the product or service. It allows a user-centric design highlighting the user experience. The concept of design thinking became eminent in 2015 when Harvard Business Review (HBR) in their September issue published an article on this principle of design and its benefits. Soon, many leading organizations began adopting this approach, which they found to be extremely viable.
Opportunities for the BFSI sector
This new design framework has gained a lot of momentum in the BFSI sectorwhichwas one of the biggest service industriesthat had not focused on the ‘human factor’when developing products and services.Business problems in this industry could be solved by learning and applying human-centred techniques in an innovative way and these techniques form the building blocks for the design thinking framework.
Since the user perspective is of utmost importance in this framework, the final products or services offered by organizations using design thinking would drive more consumers towards them because these products or services would address and solve pertinent problems that consumers face in their day-to-day lives.The most important component of design thinking is therefore to empathize with your consumers.
Design thinking unlocks many opportunities for companies in the BFSI sector. Bank operations are now changing their strategy from “managing” to “pioneering” services and solutions for the convenience and benefit of their customers.
Design for dynamic consumers
The nature and needs of consumers are constantly changing and technological advancements enhance this transformation. People want to become independent decision-makers and their attention span is also becoming narrow. This becomes the biggest challenge for organizations. Hence, the foremost objective of design thinking is to make the products and services convenient for both new and existing consumers and let them make decisions without major outside interventions. Therefore, the design should be more adaptable to the needs of each consumer.
Continuous consumer feedback helps to improvise the product or service. To that end, banks and financial institutions should develop a reliable feedback generation mechanism and involve the consumers in the business process. This feedback can also be used as a foundation to build newer products in the future.
New products should be more personalized and customized than the current bank offerings. Pricing structure should be fair and customer knowledge should be used to define the value proposition. Data collection has become very important to understand customer profiles to offer them the best products. Banks need to be transparent in their communication and customer issues should be solved swiftly. People want banking to be straightforward and easy, and every bank should strive to make this happen.
Design thinking for future
The user-centric methodology is helping financial institutions including banks, insurance firms, SFBs, NBFCs, FinTech players, payment banks, etc., to develop or restructure their services to be more agile. With stringent financial regulations that often limit change, frugal innovation makes design thinking critical for BFSI companies. Thinking inside the box becomes as important as thinking out of the box. The recently evolved financial services’ aggregating portals and applications like Bank Bazaar, Policy Bazaar, etc., are driving huge engagements by leveraging design-thinking in their services and platforms.
The COVID-19 crisis has provided a massive opportunity for digital financial platforms to grow. There is a lot of competition among organisations in the BFSI industry to develop and intensify their digital solutions. As a result, more non-served or under-served consumer groups are using digital platforms to fulfil their financial needs. Going forward, this trend will only become stronger. Therefore, institutions in the financial industry must implement design thinking principles while developing their services to remain relevant.
Design thinking is demanding financial institutions to deliver intuitive, secure, and satisfying services by engaging consumers for product development and improvement. Additionally, the progress of financial institutions has a direct impact on economic growth. Their failure would adversely affect the economy. Hence, a people-centric economy like ours needs a people-centric financial system.
All in all, design-thinking is going to be a key element for the BFSI sector as they reinvent their solutions for the new world. The banking sector is going through a phase of disruption. FinTech companies have been challenging the traditional banking business and the time has come for banks and other financial institutions to transform themselves and be future-ready.
Views expressed in this article are the personal opinion of Robin Bhowmik, Chief Business Officer, Manipal Global Academy of BFSI.