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The Indian banking industry plays an important role in the economic development of the country and is the most dominant segment of the financial sector. The sector has translated the hopes and aspirations of millions of people into reality. In recent years the influence of external forces and internal constraints have fostered a paradigm shift in the banking industry. At the same time there’s a need to juggle the modern customer’s needs, and face increasing competitive pressures, especially with the emergence of new players and disruptive solutions in the financial market. This new environment has triggered a resurgence in the importance in uplifting banks core business performance by reducing costs and improving operational efficiencies and many banks have implemented lean programs as a useful tool. As a practice that focus on greater operational efficiency through waste elimination and continuous improvement lean banking has increasingly been perceived as an effective methodology that contributes banks to improve their businesses performances and prosper in this challenging environment.
Banks are process-intensive organizations with incredibly complex workflows; within this complexity lies a significant amount of hidden waste. Process waste can present itself as “Rework due to process errors, unnecessary checkpoints, physical dispersion of information, multiple storage of information, invalid/expired documents, data or documents missing, scanning errors, unnecessary points of approvals, duplication & nonstandard procedures, low degree of automation, delivering services the client doesn’t need & more.
Lean transformation is the establishment of a sustainable culture of continuous improvement. A true Lean culture is rooted in the idea that every employee, at every level, tries to improve his or her work environment, processes, and habits. Organizations need to invest into teaching employees Lean practices and principles to everyone, at every level.
Why Lean Banking
Banks have to deliver high-quality, customized customer experiences while improving operational efficiency and reducing costs. These two, seemingly opposing, challenges leave banks looking for innovative solutions. This – operational inefficiency – is the initial reason many banks have turned to Lean. In manufacturing, engineering, software development, services and beyond, Lean has been proven to effectively help organizations control operating costs and reduce risk. Lean helps organizations systematically uncover and eliminate hidden sources of process waste, thereby creating new opportunities for improving operational efficiency.
Vedzen established through project work, that Lean practices can effectively lower a bank’s cost base by improving operational productivity in all levels & simplification of process like account opening, loan & advances, ATM cash deposits, Industrial project loan, delivery of ATM cards, locker operation per day & data purification for all types of deposits & advances where our projects shows improvement in process lead time reduction by 20-40 % within 12 to 18 months. Lean has proven to be a particularly effective solution for lowering back and front-office costs.
Streamlined processes and operational efficiency lead to reduced costs and released capacity, meaning lean banking process improvement contributes significantly to your bottom line
Develop / Execute training & implementation program for specific challenges based on the voice of customer.
People will be trained on shifting fixed mindset to learning mindset through the presentation, case studies, and simulation games & training on Practical structured problem-solving through Group exercise & standard PDCA approach through defining the problem, brainstorming process, root cause analysis (5x whys) & action plan to solve daily working as well as chronic problems like delegation, communication& Information technology etc.
A holistic implementation of Lean ensures that the entire organization is enabled, empowered and motivated to deliver consistently excellent customer experiences – and therefore, improve the bank’s bottom line.
Benefits of Lean Banking
- Improvement in the process lead time by 20-40%
- Improvement in productivity by 15-20 %
- Effectively lowers a service cost by 15-20 %.
- Effectively utilization of resources
- Identifying waste & eliminating variances leads to profitability
- Improving workplace through visual management
- Improving the quality of work