In his recent interview with Lafferty Group, Adeyemi Razack Adeola, CEO of Sterling Bank plc, spoke on the bank’s strategies and other issues. Excerpts:
What is Sterling Bank’s strategy?
Our strategy is a fusion of the bank’s appraisal of our operating environment and the vision we have set for ourselves, which is “to be the financial institution of choice.” We have therefore, over the years, incorporated a good degree of flexibility in coming up with our action plans, bearing in mind how dynamic our operating environment is, amongst other driving elements. In keeping with global trends and the peculiarities of the Nigerian business environment, we realigned our operations more efficiently along business segments, with the Retail and Consumer Banking segment dominating our strategy for our liability generation and the Corporate and Investment Banking segment for our risk asset creation. This is based on our belief that the key objectives of Nigerian banks will centre on efficient liquidity management, cost efficiency, excellent service delivery and asset protection in order to sustain optimal returns on capital. To achieve these goals and play optimally in the environment, we have scaled up our business through mergers and acquisition (M&A) and various capital raising activities. Thus, we have been able to increase our distribution network, enhance our technological capabilities to improve operating efficiency and entrench a customer-centric business model.
Can you address the Sterling culture?
Having metamorphosed into Sterling Bank through a merger of five banks, and a subsequent acquisition of one more bank a few years later, we faced the challenge of incongruence, which is typical in new unions. As one of our long-term goals, we want to be “A Great Place to Work” by driving a culture where people take the initiative, with our customers’ needs guiding all we do. We came to the realisation that what holds us together as a group of people is that we feel a sense of purpose when we enrich the lives of those we come in contact with, which is also in line with the culture we are trying to build. Following from this, we embarked on various projects to instil and inculcate this purpose in our system. We started with the Sterling Volunteer Programme – an initiative that allows us to give back to our communities through education. Members of staff are encouraged to volunteer, to teach various subjects ranging from mathematics to financial literacy in government-owned schools. This was immediately followed by the Sterling Environmental Makeover (STEM) – an environmental cleanliness exercise that galvanises staff to clean the dirtiest locations in our areas of operation. This was for two reasons: (a) to bring dignity to the work of our street cleaners and make them realise that we (the society) appreciate and respect their work; and (b) to raise awareness on the importance of a clean environment to the health and well being of the society. We partner State Government waste management agencies through the provision of kits for street sweepers and highway managers. In the coming years, we would like to take on other environmental issues such as tree planting in the desert areas of northern Nigeria and waste recycling, among others. To further instil our culture, we have embarked on a Culture Transformation Project in conjunction with an external organisation, Great Place to Work Nigeria, which is facilitating boot camps, in-class trainings, weekly learning sessions and town hall meetings. Furthermore, upon entry into the institution, all new staff are taken through a culture curriculum before they [commence] work, to ensure that the dominant culture is entrenched as they come into our system.
What place does customer-centricity have at Sterling Bank?
We made bold in 2009 to declare that we are the “one-customer bank,” in direct correlation with our mission to “deliver solutions that enhance stakeholders’ value”. Through our brand promise, products and channels, we pursue our customer-centric goals; and we are building an intelligent customer-centric banking system using technology. In order to further understand our customers, we have invested in a robust Customer Relationship Management System (CRMS) and are committed to ensuring the world revolves around our customers, as it is portrayed in our newest commercial advert. We have a fully equipped contact centre that attends to customers at all times (24/7/365), comprising people who, in totality, speak at least ten different languages and can be reached via various platforms: telephone, text messaging, social media messaging and live chats on the web. Our branding is also very customer-centric, as we have embarked on creating a “friendly, fun and more vibrant look” with our retro design that contains many different shapes and colours all around the number 1.
This design we interpret as representing the diversity of our environment and the fact that Sterling Bank recognises this and treats every customer uniquely. For our corporate clientele, we focus on building advisory skills, leveraging our expertise in finance to facilitate transactions between them and developmental finance agencies.
This allows for appropriate risk management for the bank while enabling our clients to conduct or scale their business with long-term financing. Furthermore, our transaction banking platform is designed to enable self-service for corporate customers, minimising the risk of fraud and creating convenience in transacting and managing these organisations’ finances, globally and locally. In a business environment where competition is stiff, customer-centricity is our differentiator, and our most important means of growing the customer base – another aspect we are taking very seriously this year and beyond.
Can you address Sterling’s retail-centricity?
Our approach is that we want to fit into the lifestyle of the customer. We want all transactions to take place within our ecosystem whether the customer is buying a new wristwatch or paying a medical bill. For us, this is what retail banking is about- that all the consumers’ needs are met in one space. As a result, we have expanded our products, channels and offerings. First, our branches have been designed to be less daunting and more conducive for our customers to transact and ‘relax’. We have areas that do not have the security specifications and barriers that our environment requires. In our opinion, the only customers who appreciate the barriers are the ones who want to transact in cash. Our branch network is now designed on a ‘hub-and spoke’ basis with one large (hub) branch and smaller sub-branches around it. This is both cost-efficient and effective, as it allows us roll out branches quicker than we used to. In 2013, we launched our agent banking service to bridge the gap for customers who find coming to a bank branch tedious but would still like the ‘human feel’ that branches provide. We have grown our network by 600 agents across Nigeria in the last year. Second, our electronic channels, which consist ATMs, POS, Internet Banking and Mobile Banking, have been designed to serve customers conveniently.
We recently tested a mobile form of our Internet banking to allow authentication through One-Time Passwords, which are both more timely and cost-efficient for the bank and customers, as hard tokens are expensive and cumbersome. Our short (USSD) code service *822# is targeted at those who may not have access to the internet but require quick service, and customers are able to buy airtime, transfer funds, retrieve their account numbers and bank balances on this platform. As we expand our scope, the aim is for this to become a full self-service platform for all types of transactions. Third, to shorten our loan processing cycle, we invested in the AXE credit portal, which analyses and responds to loan requests within a few hours. Over the years, we have gathered experience of consumer needs which allows us to create product programmes that can be fully automated to allow for efficiency. Fourth, in order to deepen our penetration in the retail space, we sought a Non-Interest Banking (Islamic Finance in other jurisdictions) licence from the Central Bank of Nigeria in view of the huge opportunities that exist in that space. We are also investing in private banking capabilities, with both value propositions aimed at catering to specific demographic and income groups. And lastly, we have also designed propositions targeted at the youth, through our social media channels and education sector proposition. We recently launched a pioneering product, “Social Lender”, targeted at the social media audience, which offers quick credit based on social media reputation. The product earned us the Most Innovative Bank/ICT Product at the tenth Annual Telecoms Awards.
What is the relationship between Head Office and branches in terms of responsibility?
Sterling Bank runs a centralised system where the Head Office takes major decisions and houses the support functions for the organisation. For efficiency, where it becomes necessary, certain departments build regional desks within the network to serve branches in that vicinity. This is in line with our hub-and-spoke approach. These regional officers are empowered from the centre to carry out their functions without hitches. However, for units that have business development responsibilities, a different model is adopted. Representatives are selected by regional heads (Business Executives) from among their staff to take on the responsibility of identifying opportunities, following up on leads generated from the centre and consummating sales. These teams go on joint calls with the branch staff to get results.
What is the relationship between branches and digital banking?
Initially, our digital banking was directed at only serving existing customers. However, we have expanded the scope to also include customer acquisition. The relationship between branches and digital banking is complementary, where customers can transact or initiate a relationship in one space and conclude it on another channel.
For example, our digital channel on BBM generated over one hundred thousand leads for the sales teams to consummate. Customer complaints and requests that were traditionally branch driven are now being attended to on digital channels with input from the branches.
