Accenture has pushed deeper into the Financial Services consulting space with the acquisition of Allen International, a London-based design consultancy that works for dozens of banking clients globally.
Founded in 1992, privately-held Allen International is a design consultancy focused on helping banks transform their branch networks and digital capabilities to reduce costs, increase revenues and better engage customers. The firm has over the past 25 years, according to its website, worked with more than 350 banks around the world including nine of the top 20 banks. Among its customers are institutions such as Emirates NBD, Bank of Ireland, CIBC, Banorte, Mauritius Commercial Bank, Creditbank, State Bank of India, Santander, Islandsbanki, Qatar First Bank and Virgin Money.
With the acquisition of Allen International – terms of the transaction have not been disclosed – Accenture bolsters its UK-based Banking practice with a range of digital and customer experience offerings aimed at branch networks. Against the backdrop of the rising power of digital, and changing consumer expectations, physical branches are losing their importance. The UK has, for instance, seen a sharp drop in the number of bank branches in recent years (more than 600 branches have closed across Britain in the past year alone), yet, according to a study by A.T. Kearney, the industry still faces an optimisation potential, particularly in light of the high penetration rates of online banking.
Branches will, however, not disappear entirely from the streets. While consumers increasingly prefer to engage with their bank via digital channels, there is still a need for branches, with nearly 70% using them for important financial decision making. Branches also still play a key role in brand positioning for banks and are seen as vital in building customer trust – a key area of concern for banks – despite lower usage.
With the added expertise of Allen International, Sushil Saluja, Senior Managing Director of Accenture’s Financial Services unit in Europe, Latin America and Africa, says the firm will be better positioned to support clients with optimising their branch networks. “Current branch formats and networks are unsustainable in the long-term and moreover banks are yet to capitalise on potential efficiencies in their branch networks. Combining Accenture’s deep financial services, distribution and marketing expertise and scalability with Allen International’s digital and physical banking experience will enable banks to strategically optimise branch networks”, Saluja explains.
The bolt-on will, he adds, also strengthen Accenture’s digital portfolio of services to banks, geared at helping them transition to a so-called ‘phygital’ bank model that offers the right blend of branch and digital services. Propositions include helping branches re-invent their technology-enabled target operating model, supporting them with adopting an omni-channel approach, digitisation, reducing distribution costs and raising customer engagement. “The acquisition expands and complements our capabilities to help banks make the branch a physical manifestation of the digital experience. This will help banks transform physical structures at scale within a sustainable cost structure without losing customer engagement by delivering a seamless, cross-channel experience consumers increasingly expect.”
The pickup of Allen International is the latest in a string of acquisitions Accenture has closed in the past two months. Six major deals have been closed, including Kurt Salmon and New Energy Group (see here for all deals).
Michael Allen, founder and group CEO of Allen International, says he is delighted with the joining of forces, adding “Joining Accenture offers us the scale and complementary skills and expertise to continue to help banks realise significant benefits at a time when there is no choice but to bring branches into the digital age.”
According to a recent study by EY, the importance of the banking sector as a whole is sliding down globally.