Sunday, 3 July 2022

CIMB Niaga’s Lani Darmawan: “Digital transformation increases our resilience and services to customers”

5 min read

Interviewed By Foo Boon Ping

CIMB Niaga's president director, Lani Darmawan, discussed the changes that the bank implemented, both in its work culture, and products and services, amid the pandemic and why they will continue despite the easing of restrictions.

During the  COVID-19 pandemic, CIMB Niaga implemented a hybrid work-setup for its employees, mainly due to social distancing protocols. During this time employees would alternatively work both from home and in the office, depending on the restriction guidelines, and work requirements. Similarly, the bank has observed an increase in the number of customers who prefer to bank online, instead of visiting their local branches. CIMB Niaga's president director and CEO, Lani Darmawan, said that the bank has observed good results from these changes. The bank's net-promoter score has increased and many of their customers felt satisfied with their online banking experience. According to Darmawan the bank will continue to implement the hybrid work setup for their employees, as well as invest and improve their digital channels. 

 

Here is the full transcript:

Boon Ping (BP): I'm excited to meet the president director of one of the largest private commercial banks in Indonesia, Bank CIMb Niaga and Ibu Lani Darmawan. As the Indonesian emrges from COVID-19, I'm interested to know Bank CIMB Niaga is preparing for the new normal, its customers and how are you focusing on your priorities for the immediete future. 

Lani Darmawan (LD): We are very glad that everything seems to be going back to almost normal. So hopefully, it will be over within a couple of months. In Indonesia, the rise of SMEs is one of the things we are very thankful for. The majority of our economy, more than 87% of our economy are SMEs. And this is a sector which has proven to be quite resilient. Data from the government shows that by the end of last year, economic activities of SMEs, day to day transactions, are starting to go back to normal for the majority. We are still very bullish about the economy and about the effect after the pandemic. The government plans to shift (classification of COVID-19) to endemic, which I think makes sense. 

We have been investing in digitalisation since the last couple of years even before the pandemic. So we are investing quite a lot in financial and digital services, especially those customer related through our digital channels, we have OCTO Mobile, we have Octo Clicks. And for non-retail, we have e-channel, which we have enhanced. We look at regular surveys of  customers to get the best UI, UX (user interface, experience). When pandemics struck in 2020, our customers were still able to access their portfolios, o their transactions, whether it's retail or non-retail. So again, the acceleration of digital transactions, the dependence on brick-and-mortar channels is essentially diminishing. We can see now that more than 97% of the transactions of our customers are actually done outside of traditional channels, majority from digital channels.

The lesson learned is, frankly, nobody knows what will happen when the pandemic struck in 2020. But being true to our investment, to customer needs, in advance is actually a benefit for us. CIMB Niaga is one of the top banks considered to have provided a very good platform for the customers to access their portfolios. There's a lot that we can learn. We are quite prepared in that sense. And the other part is the way we work in the beginning of the pandemic. The new way of work, the new normal. We implemented a new way of work, even though pandemic may go away soon. We do a hybrid way of working. With the current conditions, 65% to 70% of our team are working from office, but the rest are working from home. But we believe we will still be able to hold on to the hybrid way of work. We introduced I-Work in CIMB Niaga, which is a hybrid way of working. We divided some of the units who are able to do both work from home, work from office or work from everywhere. We changed the workstations. We are able to free up almost about 25% of our office space, which is quite efficient, by using the new normal way of work, by I-Work. Majority of the staff is using the hot desking currently, they can go to office by setting up or scheduling their work from office through an application which we created internally, which we call Arjuna. For the past two years, we have been assessing the way that we work, from 70% from home to currently but 35% work from home. And we'll continue to do hybrid. We are still working in a very positive and productive way. And the lesson that we take from the pandemic, and we take the positive part, which is we become more efficient and also effective with the new way of working at  CIMB Niaga. 

BP: One of the impacts has been the way that you work, you changed the way you work, hybrid work will remain as one aspect of post COVID life. Now, in the industry, many players have accelerated their digital investments. You mentioned a few digital channels or platform CIMB, Octo, Octo Clicks, and so on so forth. How has your investment in digital been accelerated? And how has it transformed your business in the last two years?

LD: One thing is our customer experience. We started to use the measurement of NPS, Net Promoter Score since 2017. We started with a score of only “five” at the time. During COVID, our score increased quite a lot. Through the feedback we learned that our digital capabilities played a big role in increasing the customer experience, through the NPS. Last year, ending 2021, our NPS, coming from digital services and solutions that we provide the customers, rose from five in 2017 to 28 last year, one of the impacts to our customers. The second is efficiency. The cost of transaction through digital channels is much lower compared to branch, ATMs, are more expensive compared to purely digital channels.

The challenges will be the uncertainty. That's the part that not only CIMB Niaga but everybody needs to be cautious of. That's why we are monitoring it. We work together with the government, we engage the regulators as well. And we are very active in some of the talks as well with the government. And the other is sustainability as well. How do we implement that in order for us to be super active in participating to grow Indonesia's economy, but also compliance to sustainability. The rest in terms of financials, looking at our target and budget, we are very positive so far. We are also cautiously optimistic about 2022. Let's see what will happen. Again, just like I explained earlier, looking at Indonesia’s economy, SMEs are growing and the rise in commodity price is benefiting Indonesia. 

And the other part is actually, we will continue to invest on our digital channels. Because we know that contributes quite a lot in our progress, in our NPS and customer is very important. Customer centricity is actually one of our focuses. So again, we want to listen to the customers through our surveys to know what customers need, what solutions that we need to provide through digital as well as through one-on-one advisory to our customers.

BP: Thank you so much Ibu Lani for sharing your thoughts on a wide range of topics and your outlook for the industry going forward post COVID and we wish you all the best and I look forward to coming back and continuing this conversation with you.

LD: Thank you. Thank you, all the best to The Asian Banker as well. Thank you.


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