Thursday, 23 September 2021

Kasikorn’s Kiatsupapong: “We transformed into a data-driven organisation using machine learning to empathise with customers”

Interviewed By Foo Boon Ping

Jarung Kiatsupapong, chief information officer (CIO) at Kasikorn Business-Technology Group (KBTG), discussed the bank’s ability to swiftly respond to challenging situations, underpinned by its resilience and the digital transformation that has been put in place even before the COVID-19 pandemic.

Jarung Kiatsupapong started his career in information technology (IT) for a small Thai bank, which became his stepping stone to where he is now. As a common business-oriented language (COBOL) programmer, he was responsible for the year 2000 (Y2K) requirement of the core banking system. He helped the bank create one of Thailand’s first e-commerce payment gateways during the dot-com era, which opened his horizon into the world of online business and payments. He also designed the bank’s IT infrastructure and solution. Kiatsupapong later ascended to the managing director position at Kasikornbank (KBank)’s IT subsidiary, Progress Software.

In 2010, he was appointed the first vice president at KBank and subsequently rose to become the senior vice president in 2013. Kiatsupapong joined KBTG in 2016 as deputy managing director. He became the managing director a year later and was appointed CIO in February 2019. He is concurrently the vice chairman at KASIKORN Vision Information Technology and a non-executive director at Kasikornbank.

“For the last three years, I took the role as CIO at KBTG. With this role comes the word ‘transformation’,” he said. He works to achieve efficiency, quality, security, and responsiveness to the needs of customers. 

KBTG, a subsidiary of KBank, continuously develops innovative solutions to revolutionise its customers’ financial experience to suit their digital lifestyle. It manages the IT infrastructure of KBank.

KBTG imbibes a “customer first” mindset and is the driving force behind KBank’s success. It helps navigate the digital world beyond Thailand, providing wide-ranging online banking services equipped with concrete infrastructure and capabilities to guard the customers’ valuable assets and data. KBTG uses its expertise in financial technology (fintech) business, combined with creative thinking aimed at transforming into the best technology organisation in Southeast Asia.

Some of the innovation partners are Black Canyon Thailand, a café and restaurant chain with more than 350 stores; Major Cineplex, one of the largest operators of movie theaters in Thailand; and Forth Smart Service, manufacturer of online top-up machines known as Boonterm, with more than 150,000 vending machines across the country.

KBTG and Black Canyon jointly developed Eat by Black Canyon, a smart contactless café. A self-service kiosk was deployed to handle customers’ orders with the use of facial recognition technology. It helps reduce the café’s operation cost and grow its new customers.

KBTG introduced ReKeep, a paperless receipt service; Contactless Menu, an operation system that uses hand gestures; as well as Major Cineplex’s ticket selling kiosks. KBTG and Major Cineplex created a green contactless cinema model, wherein customers can purchase the ticket, scan quick response codes to redeem the ticket through a smartphone and head straight into the cinema with a zero-touch experience.

KBTG has also installed facial recognition technology in Boonterm’s vending machines. It helps increase Boonterm’s revenue by expanding the electronic know your customer (e-KYC) service. Forth Smart was able to set up its e-KYC business and the “KYC anywhere” concept during the first month of this innovative project.

Established in 2016, KBTG specialises in new technology such as blockchain, machine learning, and internet of things, as well as application programming interface, fintech, mobile application, and financial platforms.

The following key points were discussed:

 

The following is the edited transcript of the interview:

Foo Boon Ping (FBP): What is the one key opportunity and challenge that your bank faces in this age of digital innovation and disruption?

Jarung Kiatsupapong (JK): Transformation. To survive and thrive above disruption, we need to transform someway somehow. As the world changes, we need our people to change their mindsets. Transformation prompts our employees to be more flexible, ready to move forward and face anything that comes their way. To change one’s mindset is a challenge in itself but that is how we build culture.

FBP:How would you assess the degree of transformation that the bank has achieved so far? What would you consider the achievement that you are most happy/proud of? At the same time, what other opportunities are there to make further progress? 

JK: In the current situation, our team is able to work remotely and use the video conference tools for communicating with one another. With this environment, our delivery team can still deliver almost the same number of projects as we do under normal circumstances. They are working as one team, helping each other and sharing a common goal. I feel proud of them. This difficult time has created a beautiful relationship among all teams. Moreover, our Human Resource (HR) team is taking this opportunity to continue the momentum of forming human bonds. 

FBP: How has transformation strengthened your organisation and operations during COVID-19?

JK: It changed the way we work. Working remotely or working from home became mandatory. To go through this together as one, KASIKORN Business-Technology Group (KBTG)tries our best to provide all tools and secure access to ensure that our employees can work in the same environment at home as in the office. Aside from the facilities, the human touch is crucial. The health of our team, both physical and mental, is one of the hot topics in our management meeting. To ensure that our employees are taken good care of during this stressful time, we provide online psychologists to provide consultation to help relieve their stress. Some employees who live alone expressed how they feel isolated working in a small room of their apartment compared to those who live with a family. As a result, our HR team works together to create online recreational and social activities that all can join to create a smooth transition until the crisis passes.

However, there are some IT operation units that need to work on-site for the bank. We support them by providing facilities and safe living spaces to protect them from COVID-19 as best as we can. 

FBP: As the bank and customers are forced to turn to more online and remote transactions, there are reports of greater operational risk and cyber security issues. Tell us how is KBTG helping the bank mitigate such operational risks and cyber security, fraud and crime during this time? Describe some specific measures that you have had to take. 

JK: Since 2013, KBank has been Thailand’s number one digital banking in the number of customers and transactions. Handling risk and cyber security are our most important priorities. We update it frequently and even get it regulated by the Bank of Thailand. This is to ensure the digital banking services we’re providing are up to the standard as it should. 

FBP: What are your views of digital transformation driving organisational and operational resilience during the pandemic? How has COVID-19 catalysed opportunities for digital transformation and how has it impacted your institution?

JK: Without the digital transformation and the innovative mindset of our team, we might not be able to survive. COVID-19 catalysed and transformed the way we work drastically. None of us have any choice but to do so. Fortunately, the year before COVID-19, we have already transformed our bank to a data-driven organisation, using machine learning to empathise with our customers. For the past two years, we have been focusing on developing our own digital lending platform with the use of data. This capability helps us a lot during this period. Had we began this during COVID, it would have been such a difficult feat as it must be done on-site due to data sensitivity. We are so lucky to have completed this transformation by the time COVID-19 surfaced.

FBP: You described KBTGs transformation before COVID-19 and the introduction of important capabilities such as being data-driven, the use of machine learning, developing digital lending, etc. Could you talk also about capabilities in the areas of achieving operational agility, scalability, efficiency, security while lowering cost of technology, for example via cloud and what you are doing in that area.   

New technologies such as Agile/DevSecOps provided quality, security, and efficiency to the bank

JK: The use of new technologies or the way of work like Agile/DevSecOps can help us improve our quality, security and efficiency of our project delivery. That said, we need to be able to justify the reason behind this investment. For instance, for systems like on-demand services, we use cloud technology as opposed to booking the resources on premise and having it do nothing during off-working hours. Managements always say when we feel the need to spend on something, we need to imagine it as our own money.

FBP: With so much uncertainty in 2021, how will your bank remain resilient? How do you plan to support your customers, employees, and the community to be resilient?

JK: One thing that we focus on is sustainability. Our customers must survive. To offer support and help recover their businesses are important for us and the ecosystem. We offer various support programmes for our customers and join forces with the government sector such as the Bank of Thailand to provide aid. Like a domino, if our customers survive, so will our employees and business. 

FBP: Would you be able to share specific initiatives and outcomes in each area around customers, employees and community? It will be interesting to use this as a casestudy of what you have done and achieved. 

KBTG supported the recovery of businesses by giving zero-interest, 10-year loans

JK: We focus on helping our customers survive and recover their business. One of our initiatives is to offer the 10-year, 0% interest loan to our customers in the hotel business to cover 50% of their employees’ salary, so they can keep their business and employees afloat. We cut into our profit to sponsor this initiative as we know if our customers cannot survive, neither will we. 

Another initiative is joining forces with the Bank of Thailand and the government to transfer the collateral that the business uses for guaranteeing its loan to the bank to stop the interest. This comes with a special condition that the bank needs to rent this asset back to the owner in this period with a reasonable renting fee and allows them to buy it back after the crisis.

FBP: In the space of a year, the competitive landscape in banking has changed. Several of the confident challengers from this time last year have struggled or been acquired. What insights into resilience for banks and banking can we gain from this?

KBank imbibes an “Infinite Game” mindset to develop products and services for sustainability

JK: Our bank encourages the “Infinite Game” mindset. We are no longer competing against our competitors. Instead, we need to compete against our yesterday selves, always developing better products and services. That is how we grow sustainably. The key is to empathise with our customers, fully understand their needs. Then we use those insights to build suitable services with the digital capability that we continuously learn and acquire from the market. 

FBP: In your opinion, what specific area of strengths from a technology and operations perspective, do you think traditional/incumbent banks have over the challengers that were highlighted by COVID-19? And what lesson will you draw from it, again from a technology and operational perspective? 

JK: Uncertainty is a challenge during this COVID-19 pandemic. We need to have fast and accurate information in order to decide how to manage issues that we are facing. Flexible IT infrastructure is another area that helps us immensely. It allows us to split sites smoothly where key people can work from different sites, including working from home in some areas. The lesson we received is we need to always have a backup plan to ensure our business continuity. All the annual practices that the bank already does are a must and we need to have the scenario close to the possible crisis situation. 

Insights on leadership and resilience

FBP: Tell us your personal story. How were you in your younger years or early days of your career? Did you always want to work in a bank?  How did you rise up the ranks to be the CEO of the bank?

JK: I started my career in the IT department of a small Thai bank. My first job is COBOL programmer, in which I accommodated the Y2K requirements to the core banking system. During the dot-com era, I helped my boss build Thailand’s first e-commerce payment gateway and consequently joined the e-business team. Thanks to that experience, I learnt a lot about online business and payment. As an IT guy, I have designed the IT infrastructure and IT solution of the bank. I then ascended to the managing director position of KBank’s IT subsidiary (Progress Software), taking care of over 700 people, before the company merged with KBTG. For the last three years, I took the role of CIO at KBTG. With this role comes the word “transformation”. I seek ways to make the lives of my team easier, reduce unnecessary processes, eliminate the hierarchy of approval and build a more efficient way of work but still maintain quality and security. Responsiveness to all markets is another point we need to consider. 

FBP: What does resilience mean to you personally? How does one become resilient? 

JK: Resilience is how you can handle changes well. To do so, it requires a great deal of experience and flexibility. When facing a challenge, a resilient person would know how to tackle it based on the large span of past experiences. Having gone through something familiar, he/she would be able to identify the proper tactic, if not, find the right combination of approaches that might work. He/she also need to be flexible in terms of handling crises in order to surpass them. 

FBP: COVID-19 is a crucible within which resilient leadership has been refined. What do you think is at the heart of resilient leadership?

JK: A resilient leader must have a can-do attitude, being certain that whatever happens, they are capable of handling it. The heart of resilient leadership is understanding the situation and feeling in control. As we all know, COVID-19 is an unprecedented crisis. There is no textbook solution. It is up to the leader’s capability and the flexibility of the management team. For example, if working on site is impossible, we need to find a way to enable working from home. Or if our employees feel stressed, we seek a team of online psychologists to help them. The leader needs to be at the forefront of the problem and make the call. 


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