To succeed in the future, financial institutions must embrace a culture of innovation that reinforces the process of digital transformation. To accomplish this, a bank or credit union must have strong leadership, openness to experimentation and risk, willingness to challenge the status quo, and solid business strategy that “pushes the limit” of what can be possible with modern technology. Most importantly, the institution must possess an overarching focus on the customer.
Complacency continues to be one of the biggest challenges to becoming an innovative organization. It arises when strong revenues are being delivered, existing customers are not complaining, and shareholders are happy. (“If it ain’t broke …”) This is a dangerous scenario, however, since despite these positive indicators, we have also seen advanced digital technology being introduced, the competitive battlefield intensifying and the metrics for success shifting.
Today, small fintech and large technology organizations have found ways to reduce costs, improve back office operations, deliver a better customer experience and create banking solutions never before imagined. Unlike the iterative innovations from the past, a premium is now being placed on “big ideas,” agility, and real-time application of data for personalized contextual experiences.
To support an innovative culture in the digital era, there is a need for interdepartmental cooperation, the breaking down of legacy product silos, the creation of ideas and solutions at all levels of the organization, and a willingness to collaborate on innovations outside the organization. There must be an increased acceptance of risk taking and experimentation. Institutions must focus on the agile iteration of ideas in place of the traditional, lengthy, over-structured “conversion” mentality.
With advanced technology applications like AI, machine learning, the Internet of Things (IoT), robotic process automation, voice, the cloud and blockchain, leading innovative organizations must find new ways to use data to create a sustainable future at a time of digital disruption. And this must be done while we are on the brink of a global digital talent shortage.
Now more than ever, we have a need to upskill and reskill existing workers, while embracing a new generation of workers who have been immersed in digital technology since birth. The future will most likely not see machines replace humans, as much as a machine’s analytical power being combined with a human’s creative power to provide a platform for innovation and digital transformation.
The Innovation in Retail Banking 2019 report, published by the Digital Banking Report, and sponsored by Infosys Finacle in cooperation with Efma, found many characteristics that differentiated innovation pioneers from organizations less prepared for the future. This report, which is available at no cost ($495 value) provides guidance to organizations hoping to improve their innovation readiness.
(Copyright: The Financial Brand https://thefinancialbrand.com/89249/digital-banking-innovation-transformation-strategy-trends/)
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