Prioritizing Customer Centricity for Responsible Innovation

Andreas Kurniawan, Chief Digital and Analytics Officer, PT Bank Danamon Indonesia

Andreas Kurniawan, Chief Digital and Analytics Officer, PT Bank Danamon Indonesia

Andreas Kurniawan is the Chief Digital and Analytics Officer at Bank Danamon, where he has played a pivotal role for over four years. He leads the organization's digital transformation, focusing on optimizing business processes, customer interactions, and channel strategies. He specializes in integrating transformation and digitalization, leveraging analytics for decision-making, ensuring robust data governance, and overseeing IT project management. His multifaceted expertise reflects a commitment to driving innovation and efficiency within the organization.

In an interview with APAC CIO Outlook, Andreas Kurniawan shares his insights on the role of streamlining workflow and incorporating modern technology in the financial sector while adapting to the changing business landscape.

Can you discuss the challenges prevalent in your industry, considering both recent developments and those that have persisted from the beginning?

The speed of change in financial industries is rapid, as there is now a thin line between financial sectors and other industries. Many non-banking industries evolve their businesses by entering into payments and then moving into lending. Most of these companies wanting to shift toward financial services are coming from sectors that are not as highly regulated in terms of data security, technology, and oversight.

In contrast, the financial industry is highly regulated. Banks must keep up with the ever-changing landscape due to competition and evolving customer needs. A key challenge is that customers now have very high standards for the customer experience and customer journey.

Influenced by various industries outside financial services, where the experience is arguably superior and the customer journey smoother, expectations have changed dramatically. This shift poses a major difference for both customers and for us in the conventional financial industry. We must adapt to meet these higher standards.

How do you mitigate the challenges and achieve favorable outcomes?

The first and foremost thing we do is understanding our customers. Technology, business processes, and capabilities can be either shared, developed, or bought. But who should we partner with, and why should we serve that particular customer segment?

We need to determine that first in order to create an aligned business model and strategy. Otherwise, we will lack focus as different priorities pull us in different directions. So, understanding the customer is the number one priority for us.

Our other focus areas include understanding the market landscape – whether we need to develop certain capabilities ourselves or work with others. At the end of the day, in this era of open banking and transparency, it will be much faster and more efficient in certain areas to work even with those who could be considered competitors in order to serve the customers better.

But the final key that ties all of this together is building balance within our organization amid all the technological changes and evolving customer demands.

Can you share insights on any new and exciting technological approaches in your space in the near future?

Machine learning, ChatGPT, and AI are the talk of the town when it comes to novelty. It opens up multiple avenues for improving customer experiences and streamlining workflow within operations.To implement these new technologies in conventional industries like ours, we are constantly looking for new ways while following all regulations and security measures.

We must figure out how to implement these technologies and integrate them into our business processes. For instance, developing and testing AI capabilities requires different processes and skills compared to conventional software development, where you would typically conduct user acceptance testing. With AI, there may be different testing approaches needed.

Embracing some of these technologies is essential to keep up with market demands and customer expectations. It involves venturing into unknown territories and applying these emerging technologies. There is much to learn given how new some of these technologies are, especially for establishments like ours that have more conventional IT environments and ways of developing software up until now.

What advice do you have for your peers or budding entrepreneurs in your sector?

I believe this comes back to my earlier points. We need to understand who our target customers are and what their needs are. As enablers of digital and analytical capabilities, we must align with the business goals and serve our internal business partners well.

“Adopting emerging technologies requires persistence, an open mindset, and patience. This is not a short-term effort.”

When putting together pitches and business cases for new technologies like AI and machine learning, we should use familiar, simple business language. This will allow us to make a stronger case for why investment is needed and how it will further our objectives.

Since these are largely uncharted territories, we will need to take an experimental, iterative approach to implementation – learn and evolve as we go. Given that trust is paramount in the financial industry, we cannot plunge straight into new technologies without appropriate risk management. There are boundaries we must operate within.

Adopting emerging technologies requires persistence, an open mindset, and patience. This is not a short-term effort. As evidenced by Microsoft surpassing Apple as the most valuable company after 10 years of transformation since the CEO change, overhaul and change management takes time.

The key is to start with the customer’s needs, align with business goals, communicate our plans simply, undertake controlled experiments, and stay committed for the long haul as we work to adopt new technologies like AI and machine learning responsibly.