Operating Costs and Service Delivery Automation: A Perspective of the South African Banking Industry

The financial sector’s cost of providing customer services has been rising yearly. Various experts estimate that the operating costs seem to double every fourteen years. Remaining competitive in such conditions becomes a complex and thoughtful achievement. The ideal alleviation of the rising operating expenses could be the integration of automation into the business operating systems. This paper aims to streamline the significance of the strategic relationship between operating costs and service delivery automation through the adoption of automation from the South African banking industry’s perspective. A hypothesised relationship was established in order to understand the influence that automation can have on the banking institutions’ operating costs. The study took on a double sequential quantitative approach where a questionnaire survey was deployed to the employees of prominent banking institutions through LinkedIn and direct email correspondences to collect primary data. This was followed by exploiting annual integrated reports of banking institutions to extract secondary (statistical) data, with a focus on the number of bank outlets/branches. Hence, using Absa, Capitec, FNB (First National Bank), Nedbank and Standard Bank as case studies revealed that operating costs could be improved by adopting advanced technologically-based practices known as service delivery automation.