Accelerating digital transformation in banking

Accelerating digital transformation in banking

Digital transformation in banking has banks of all sizes scrambling to adopt new technologies and services across the board. But, if you’re moving towards digital transformation, what does it actually mean? “The banking industry is in a digital arms race and is going through dramatic changes as a consequence of changing customer behavior, increasing expectations, channel proliferation, disruption, innovative use and adoption of new technologies and the digitization of business and society in general,” says Rob Clegg.

Although in some regions and countries, retail banks are leading in several digital areas, including marketing and customer-facing operations (with great examples of omni-channel banking and mobile banking, for instance), in general retail banking still has a lot of catching up to do. Banks in general have additional challenges but the following tenets will get you on the right track to strategizing your own bank’s digital transformation journey.

The Customer Journey

All banks have a website. These digital features encompass most of what people think of as “digital services” but don’t encompass digitization in any way. How? And what does it entail? “Traditional customer journey often starts with marketing building leads, transferring those leads over to sales, and then transferring those sales over to customer service. An individual must go through several departments before they ever receive a product or service, resulting in a disjointed and disconnected or often impersonal result.” Robert Clegg said.

Digital transformation in banking allows you to create a more cohesive and personal digital customer journey. Creating a digital customer journey means taking steps to integrate everything into a single online platform so that the customer is handled through the same tooling, sometimes by the same people, and with the same information throughout the process.

Data in Banking Digital Transformation

Modern banks have more data than ever before. The more digital services you offer, the more data you automatically collect. Data allows you to understand customers in new ways, using that information to identify opportunities, optimize products and services, and automate solutions. Analytics can predict when customers want or need loans when loans default when customers are preparing to leave, or even when a cross or up-sell will likely be useful. This data, in turn, allows banks to offer highly personalized offers and solutions, either through a representative or as an automated offer or solution inside an app or online portal.

A Focus on Change

While there are many aspects of digital transformation in the banking industry, one of the most important is readiness and ability to adapt to change. Banks are often held back by security, legislation, and strict frameworks intended to protect customer data and privacy. At the same time, new digital-native banking solutions and money apps are outpacing traditional banking in terms of growth and customer acquisition. This can mean that true digital transformation in banking requires changing the organization from the inside out, focusing not on outward services like online portals and chatbots, but rather on how the organization reacts to change. You will need both to become and maintain a truly digital organization. Find out more about Rob Clegg on Facebook here.