The path to digital has been accepted as the road to success for most financial services companies, and for many good reasons. In every bank and credit union bound for success, there is at least one executive who is completely convinced that making this journey will be key to everything management wants to accomplish in the future.
In some cases, this executive must sell the vision to the Board of Directors. In many cases, the goal has already been set and it falls to this executive to make it happen.
Whether you’re building a plan and selling it to management or guiding your institution down the path to digital, there are certain keys to success, building blocks that together create the foundation for a successful digital investment strategy.
Starting the journey with data
For most institutions, going digital is a mandate required to remain competitive in an environment where nimble Fintech firms threaten to disintermediate them from their traditional customers or credit union members.
The first building block of any successful strategy is good data.
Rushing forward on a technology investment strategy that doesn’t take into account the needs of those you hope to serve won’t be effective. That’s why building good surveys, conducting focus groups and strong analytics are so important. These can be valuable tools for finding out what products your customers enjoy and what services they find the most frustrating. This information can then be taken to management and should inform your strategy.
Finding out what your customers or members really want and how they use what you already have are just part of a broader data-centric approach to the evolving business. A successful digital transformation is always built on a strong foundation of actual data, which means that someone inside the bank or credit union needs to be an evangelist for this data-oriented approach.
Creating a plan that will gain approval
Before an institution will invest in the technologies required for an effective digital transformation the board will likely expect to see a solid investment plan. A good plan is the second foundational building block.
Armed with the data showing the institution’s current state as an organization and the needs and desires of its customers, the bank or credit union executive must then prioritize digital investments in areas that the data indicates are in need of improvement.
A good plan must point to available technologies and vendors that have been shown to reduce friction in the institution’s problem areas. All of the costs associated with these technologies must be presented, along with their value to leadership.
As a best practice, most initiatives fall into three main buckets, revenue generation, cost reduction and user experience which can overlap depending on the problem the institution is hoping to solve with its digital transformation. In many cases, efforts made to solve one problem will contribute to the solution of others.
Taken together, all of this information will allow the executive in charge of transformation to present a clear business case for the problem any investment is expected to solve and create clear links back to the goals of the overall organization. A good plan makes the ultimate return on this investment clear to management.
The correct application of new technologies
Once the data has been collected and the plan has been formulated, it all comes down to execution. A good implementation plan is the third foundational block for a successful digital transformation.
This is where many institutions will call on the support of an experienced third party, someone who has been through a similar implementation and achieved success for an industry peer.
These experts will point to technologies that have been proven effective elsewhere and point out pitfalls that can derail an initiative before the software can be installed and employed.
Xtensifi has fulfilled this role for many institutions over the years and always welcome the opportunity to visit with banking executives who are ready to make the digital journey and seeking an experienced guide. For more information, reach out to us today.