The Finnovate Show
The Finnovate Show

Episode 3 · 1 year ago

Rick Lunny - How do you adapt and innovate in times of change?


Manulife Bank of Canada is one of the country's first digital banks. They’ve been around since 1993 and they’ve never had any branches. Rick Lunny, CEO shares his views on what’s made the bank successful and how they’ve continued to be a leader in the digital space, even as the industry adapts to the changing times.

As a leader of your company, you must stay up to date with your strategies and execution or risk obsolescence. Welcome to the fin of a show financial services innovators bringing you the future today and now here's your host, Jerry purcell. It's the fin of a show brought to you by invasion three hundred and sixty group. I'm Jerry purcell. Get ready to think about your biggest challenges and capitalize on your biggest opportunities. After this, executives depend on external consultants to fill knowledge and experience gaps or to have an experienced mind audit their thinking. The innovation three hundred and sixty group brings together a wide range of proven thought leadership from around the globe and cost effectively makes it available to you get the insights, advice and systems you need to succeed. Learn more at www dot innovation three hundred and Sixtycom our guest today is Rick Letty, who's the CEO of Nilife Bank of Canada, a much sought after change agent. Rick knows how to use his experience to leverage technology and transform businesses. The Financial Services Industry, and it brings a consistent record of achieving high levels of customer and employee satisfaction and getting the most out of his people and rolls across several of Canada's largest financial institutions. The CEO of Manualife Bank of Canada, rick is focused on driving change and innovation, and today we'll talk about financial services and explore some learnings drawn from a long and successful career. Rick, welcome to the show. Thank you, Jerry. So, for those who don't know much about manlife back in Canada, maybe could tell you a little bit about it. Okay, sir, I'll give you a little background. You know, I've been involved in banking for about thirty years and I've seen the industry involve a significantly along with the needs of Canadians. And what attracted me to manually bank about six years ago because it was so different than other banks. It may be the first digital bank in Canada. It's never had any branches and it's been around since one thousand nine hundred and ninety three and it has evolved those for today we're a full service digital bank offering everything from everyday bank accounts to mortgages and more. And and what what is key about Manulife Bank is that it offers an alternative to the traditional banks, and we do this through product innovation and customer experience. And really we've done this because all of our digital products and tools and services are designed to align to our customers needs in the best interests of our customers. You know, as an example of that, we unveiled recently a digital banking package that provides unlimited transactions as long as you save a hundred dollars a month. Now, what's innovative about...

...that is the fact that we provide an insight card that appears every time you go on your mobile banking APP and it shows you how close you are to reaching the hundred dollars, so you don't have to pay the ten dollar fee. Cool, cool, yeah. So, so I guess talking innovation today is right up your alley, hopefully. Yes. So for your bank, I guess one could imagine that the the quote pivots into the new environment might have been easier, but perhaps there were some challenges in changing into this new new crisis environment that we're entering into. What sort of implications did it have for your bank? Yeah, I mean we were fortunate that, you know, as being part of the Global Financial Services Group of Manu like we had a well developed pandemic plan, but of course we didn't plan for everything and you know, throughout the whole pandemic our priority has been the health and safety of our customers and our employees. But you know, things happened that you don't anticipate. We have a number of support people off shore and we had to scramble really quickly when we receive short notice that the roads and the transportation systems were shutting down in the number of hours. So we had to move quickly and rent out local hotels there our operations center, because our employees didn't have laptops at the time, just to ensure that our staff would be available to service our clients needs. And then, you know, on a more personal basis, I was up north at our cabin on St Patrick's Day weekend and the following Monday was set up as a test from everybody for working from home from North America, and it works so well that virtually nobody returned to the office on after that and I stayed at my cabin for as long as the callit of the Internet would hold up, which was several months. Very cool. Yeah, very cool. So your sales force is virtual, but it's also physical. You deal through your advisors House House. It affected the advisors that you sell through. Yeah, we deal with both the independent advisor network and the mortgage broker network and you know, so that and an industry that is geared towards facetoface businesses in terms of you know, I wet signatures and the mortgage business and you know, we have to deal with a praisers and Tilan insurers and lawyers and notaries and all of those types of procedures. We had that quickly to adjust how we were delivering our business. I would say one of the big surprises was how quickly the various regulators agreed to digital and virtual processes that they had resisted for so long. I do hope that those procedure to stay in place from the regulators point of view now. We were fortunate that we, you know, being a digital bank, we had products on the shelf that we could enable for better customer experiences. For example, we have an artificial intelligence chat bought will. We basically amended our bank APP to provide INAPP experience for customers that had any covid nineteen related questions in...

...terms of debt relief and other questions. So this is problem that little bit. I remember talking about this before. The chat bought sort of learns from conversations and then can actually have a conversation that perhaps might even feel like it's a real person of the other end. Tell me a little bit more about it. Yeah, and we don't hide the fact that you're talking to a virtual assistant and we, as you're right, we learned from the questions asked and so, as a result, we can start responding to customers in terms of their spending habits and where they're spending the money in, what categories are spending their money in. And then this was a whole new level up when we introduced the COVID type questions and it what it really did is it resonated well with the customers and it took a lot of pressure off the call centers. At the same time, I know one of the most or more important metrics that you use is your customer satisfaction and your nps scars and stuff like that. How is the change in the business impacted your customer experience scores and things? Yeah, well, I think we were fortunate, you know, at first the load on the call centers across the business when people were asking questions. We did see sort of a brief dip, but our customers, they most of them, appreciated the circumstances that we're in with with virtually everybody working from home, and responding to those. And then as we implemented more and more digital processes, such as we digitize the application process for people they're looking for deferred mortgage relief. So we saw the pressure reduced on our call centers and then we saw our NPS and satisfaction scores returned the normal or interesting. So I've been following man life for a while and very innovative place. You mentioned you're all a one banking package and stuff other innovations that you think are noteworthy from Man Life Bank. Well, you know, sometimes jurry, you don't seem, you don't feel you're as innovative as you are. I mean you mentioned the all in one banking package and we have a manualate one product, which is a offset mortgage, you know, the kind that sort of originated in Australia. So we saw the versatility and flexibility of that product through the height of the covid nineteen crisis, because this allowed our customers to fluctuate their payments in terms of their ability to pay. So as a result of that, we saw a small fraction of our customers were requiring payment relief compared to the the numbers that were publicized in the banking industry. So what was your biggest surprise, do you think, from events over the last little bit or are in terms of thinking about the future? What sort of thing do you think that hadn't counted on on our head plan for well, we did see a rapid decline in the use of cash in society and there's been a long term trend, but it fell off the cliff. Mean from my perspective, I took out Maschi some money from an ATM in February and have it, you know, and then last month was the first time of six months that they took out money. So we saw that and so it was...

...good to be sort of in a digital place, but it also, I think one of the big outcomes of this was our bank. You know, we're very focused on health and wealth and and in terms of managing your debt and your cash flow, but in the current crisis we quickly realize that this is not a time for our customers to be managing their debt. It's cash flow that's key. So we could provide them advice, either through our our independent advisor network or digital advice, on how better to manage their cash flow. This is where we felt we could help significantly on that front. The world is moving fast. It's difficult to keep up. Your executive team routinely needs new ideas to keep them ahead of the competition. Imagine having a plan in place in thirty days to focus your innovation efforts, improve customer experience, accelerate your move to digitization or increase speed to market. Our Guide to accelerating your innovation agenda provides you with insight and time saving resources to plan your path forward. Contact Jerry to book a quick call or for your complementary copy at www dot linkedincom, maxslash in, backslash Jerry Purcell, Ge Urry Pu are cell, or email Jerry at Jerry Dot purcell at innovation three hundred and sixty groupcom. So we'd spoken before about planning and some of the things that you've been anticipating in terms of Your Business and whatever, and I think what you found is let you tell me a little bit about about your found to some of the things that you were working towards actually became much more important than than, in fact, you'd expected. Well, I guess the Digital Front it in particular, and we were in a good spot from that. But you know, they're also from, you know, an employee engagement point of view, where all of a sudden are we had a culture. Fortunately we're about thirty percent of our employees were working from home. So when when that morphed into almost everybody, you know, people adjusted. They adjusted well, but it really underscored the need for constant communication, that you just can't communicate enough to your customers and your employees. It was it was very important for everyone to realize that, you know, we were in this together and that we would work through it together and we would constantly communicate with our customers, our customers that are employees, and you know, we don't have the answers. We admitted we didn't have the answers. And then, preserving the humanity of it, I found it quite useful that we were we provided some regular videos from from our cabin indicating how the relationship with my wife and I was evolving over the period of the Wilderness. You know, but it shows your humanity...

...overall and it also, you know, get you time to think about the future in terms of, you know, what is the future of financial services and how is that change? I think there's a tremendous opportunity to disrupt or gain market share in this industry, but it's not as easy as it looks. You know, we saw in the UK recently the challenges is some of the high profile fintax. So being digital is just not enough. It has it does pay to be a well capitalized and profitable company, and those doing it successfully, you know, they know how to focus on the customer in terms of the total experience and I think that's that's one of the keys coming out of this. You know, we all adapted our practices and are buying habits through this. You know, I, you know, did a lot of online purchasing and at times, you know, doing home repairs. We put off for such a long period of time and at sometimes you'd get your package the same day and then I had this big box store experience where it was on the shelf and it took them four days to get it from the shelf to the customer pickup area. So customers they've seen how people respond differently in the current environment and they will gravitate to those that are meeting their needs. Do you think the customer needs are changing or you think that they'll just go back the way they were before once the crisis has abated? Now I think we're seeing a wholesale change here in in the marketplace that you know, some people will go back to the old habits that they had before, but I think we're we've seen across the board the advantage is of digital and how consumers don't have to go out to the stores and buy their heavy boxes of Tiede and other things like that. Maybe they'll still want to go out and see the furniture they're buying and and and kick the tires, so to speak, but it's I think it's important that they recognize that. From that point of view, it's important that they're the financial service company or the company they're dealing with understands their needs and meets their needs in the way that they want to be served. One of the things I've noticed, because I've took great here too, it's that we go through these crises and they tend to be all consuming and people get all focused on today and the things are going on and the issues and stuff. How do you keep yourself and your team focused on at least enough of the looking forward to sort of plan for some of these innovations that are are you will becoming or that you'll introduce into the market? Yeah, well, I think one thing we saw across the board was that in a crisis environment it was a you had to make quick decisions and you necessary didn't necessarily have the time to assess all of the information that you wanted to have to make that decision and there was great delegation of authority just...

...because it had to be done in the environment. Well, we saw the how quickly we could get to market or and everybody saw that. And the key is, how do we preserve that? How do we preserve the fact that more delegated authority and trusting people to do the right thing actually it gets you to market faster and and it allows you to compete more effectively and you end up with more engaged employees along the way. So how are your ploys weathering the storm, so to speak? They're doing very well, I would say. You know, with the we're fortunate, as I said, that we were well equipped for that and and you know, there were some you talked about innovation. There were some innovative actions we took towards our employees. At manual life. One of the cool things was, you know, everybody, nobody was going to school and and everybody was stuck at home and we had a Manualife camp for children, for employees, children of virtual camp, and you know, that involved, you know, sing songs and craftmaking and everything else, and people got mailed at t shirt and it was, you know, a great way of how you could be innovative in somewhat restrictive environment. And now you know, when people are looking at in the current situation, it's been six months or so and people are considering, you know, when do we return to work and what's the environment going to be like? I think it's really important that anyone in this situation considers the regional differences in in the environment than the health environment. Everybody's employees needs are different, whether it's young children or elderly parents, but overall, you what you want to do is reduce that anxiety. So if you can provide ample notice to reduce that and give people time to prepare for what they have to do. I think that benefits everybody. So you talked a little bit about the fintach environment in different parts of the world, but you know, either INFANTAC or in the sort of established financial situations, who do you think is really got it figured out and not? Who Do you want to be when you grow up at where are you borrowing some of your ideas from, maybe, or who's got it right, that kind of stuff? Yeah, well, I think the leaders are the companies. I understand that there's a balance of when to build in house and when it's best to seek out partners that are already doing what your customers need. And you know, from my point of view, I don't I don't think people should sort of look inward. They should look outward outside of their own environment, outside of their own country, their own industries, and say what is working in those and how how can those apply to my industry? You know, we were looking at a car application APP where it helps consumers decide what type of car they want to buy, and I was thinking that why that APP might really work well in terms of choosing financial service packages. So the key is to keep informed about what's happening everywhere.

I mean I use twitter and I find that that's the best way to keep informed us or what's going on everywhere, both inside and outside your industry. And then how can I apply those learnings to my industry and my situation? So you know I'm a new CEO of small financial institution. I come to you. You've been around while. What advice would you give me about things I should be thinking about? Well, I would say start with the customer has too many times we see products and services designed that aren't successful because the customer was not involved in the process from day one. There wasn't human centric design, there wasn't an natural flow to the application or that sort of thing. And the other as I said, you know what's your core business and if it's not software, you know you have to decide whether it does make sense for you to build an house or to go outside. Now it does create supply chain management issues, so you have to be prepared that if you're going to do a lot of outsourcing, you have to be good at managing all of your suppliers and how they all weave together. But the advantage of the traditional large players is gone. You know, it constantly surprises me how manualift bank and can produce such digitally leading products and services for a fraction of what it traditionally cost a large player to do, and that's by sourcing, whether it's locally or internationally, people that can meet your needs. So, with all those digital and technology and stuff in cyber security and safety and stuff must be on your mind all the time. What kind of thoughts do you have about that, or innovative ways of thinking about it perhaps? Well, I think that's step one. You know, there there was a software company recently that approached us with the innovative idea that they felt that our customers would benefit from and before we'd even look at it, we see what you got to pass all the security test before show us what you've done and on the security front, before we even consider whether we want to use your product and services. So I would say that's that's kind of job one in today's marketplace. And the other element, you know, with all of the the high profile breaches that you've seen with some various large entities over the last few years, if if I was to go in the market with any type of digital product, I would just assume that everybody's identity is out there somewhere, and you better build in the the various safety procedures and precautions and due diligence to ensure that you are dealing with who you think you're dealing with and, at the same time make it a customer friendly experience. So what your biggest learning from your time as an executive in the facial services industry? I know it's a long time and maybe lots of things, but that's quite a question, bok one. Well, I think it all comes down to people, the quality of the people that you have and if you assemble a great management..., and I always make it a practice to hire people smarter than me and as a result, that makes the job a lot easier. It allows someone in my position to focus on the more strategic elements of the business and that way you you can be assured that people are doing their jobs and they feel good about it. And but I always sort of describe myself as someone who's like a hawk, circling all the time, just circling and watching and watching, and and by through something that needs my attention, I just dive down and until I'm satisfied, I'm going to be all over it. And Yeah, much to the Chagrin sometimes of all the people around you. Some I'm time so so I really appreciate you taking the time to chat and for being such a good sport about the questions. I think we'll leave the interview at that, but, as always, it's been a very, very interesting conversation and I really appreciate your thoughts and some of unique perspectives on things. So that wraps up this episode and I always like carrying your thoughts on today's or other shows. Please keep the conversations going by commenting on Linkedin. Go to www dot innovation three hundred and sixtycom to listen to more shows, download the transcription from today's show or to contact today's guests. Thank you, rick, for your time and attention. Thank you, Jerry. You've been listening to the fin of a show with Jerry purcell. If you like the show, share it on your network and subscribe on Itunes or wherever you listen to podcasts, and you can go to www dot innovation, three hundred and sixtycom to listen to more shows, download the transcription from today's show or to contact today's guest. This is the fin of a show financial services innovators bringing you the future today,.

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