Agility

18) Similarly, after a short-term hit to sales, banks making bolder staff reductions (30 percent since 2015) were better positioned for future success. They retained a leaner, more productive workforce and achieved 2 percent sales growth in 2019, compared with flat sales for their more cautious counterparts (Exhibit 4), driven in part by higher and accelerating digital sales.
19) Simply closing branches and reducing staff are insufficient. Leaders transformed, not merely

17) A common concern is that rapid reduction in branch footprint fuels customer attrition and hurts sales. In fact, our data indicate that thoughtful branch reductions did not disengage customers. Banks that persevered with significant branch closures (reducing footprint by 39 percent in five years) experienced 22 percent lower customer attrition than more cautious actors.

activities, including running detailed surveys of staff time-spend that yielded some surprising results. For example, in the United Kingdom, some advisers spent only 27 percent of their time with customers, half of teller customer time was still spent on migratable demand, and branch managers spent almost a day per week on paperwork and equipment maintenance. This insight helped leaders streamline distribution by identifying and prioritizing key journeys for digitization, accelerating migration of simpler needs to self-service, and rethinking the in-branch operating model to better match shifting customer behavior.

18) Similarly, after a short-term hit to sales, banks making bolder staff reductions (30 percent since 2015) were better positioned for future success. They retained a leaner, more productive workforce and achieved 2 percent sales growth in 2019, compared with flat sales for their more cautious counterparts (Exhibit 4), driven in part by higher and accelerating digital sales.

15) Physical distancing has necessitated a sharp change in branch usage. In March 2020, 25 percent of branches globally were closed, and 15 percent remained shuttered by May. However, even before the crisis, branch contribution to core banking unit sales had fallen from 75 percent in 2015 to 55 percent in 2019 (although average sales value remains higher in the branch than other channels). During this same period, the number of branches declined by 18 percent, and branch staff by 16 percent.

14) Many banks have also experimented with remote advisory models, such as branch-to-branch, branch-to-hub, or hub-to-home. These capabilities offer convenient access to complex advice and match customers to the right specialists, making conversations more efficient. Effective remote advisory leverages screen sharing to replicate the advantages of in-person interactions and integrates digital capabilities, like authentication for instant fulfillment, to create a seamless, secure, and satisfying experience. A successful remote-advisory offering at a leading European bank increased meetings per adviser by 40 percent and income per meeting by 35 percent. Customer satisfaction also improved, rising 5 percent.

9) A large North American bank set up a digital “factory” that brought together hundreds of staff to build new, best-in-class digital experiences and products, which enabled the bank to rapidly digitize multiple priority customer journeys.

7) To thrive in the next normal, banks not only need to meet customer preference for higher digital engagement but also must learn from precrisis leaders on how to meet more and higher-value needs via digital. While in many markets the crisis caused a significant drop in monthly unit sales across all channels, it also accelerated the sales mix redistribution as channels recovered at varying speeds

6) Biometric authentication, quick balance checks, and easy transfers are increasingly table stakes for banking apps. However, leaders take a customer-centric mindset to developing new features that will capture the attention of customers and be adopted rapidly. For example, in the United States, banks with remote check-deposit capability had about 40 percent of checks deposited via their apps in 2019