A robust digital banking transformation project helps banks to remain competitive in the digital landscape. It will enable them to offer better solutions and fulfill customer experience by integrating AI, cloud, and big data technologies.
As per a recent report by African Banker, “The African Digital Banking Transformation Report 2022,” 94% of businesses say that digital transformation is an essential factor in their bank’s growth strategy, while 42% said offering a better service to customers is their priority when investing in latest digital infrastructure.
Banks must start by revamping the current processes and operations to survive amidst the competition. Robust strategies will allow financial organizations to reconstruct the existing functions to offer the speed and resiliency needed for digital banking execution.
Here are a few strategies for a successful digital banking transformation
Support Intelligent Workflows by Using Data
Financial organizations must re-envision how they will use data. Traditionally, banks used data to create reports to determine the progress on annual objectives. Now, businesses must use the data and apply analytics more broadly within organizations.
They must use the data to revamp intelligent workflows that streamline processes and offer rapid customer experiences. Moreover, businesses must deploy applied analytics across the organization enabling the employees to provide excellent digital experiences.
In some cases, applied analytics will help new product innovations or might help shift the current job functions supporting the improved customer journey. Integrating technology and intelligent workflows enables businesses to enhance customer experience, the innovation process, and real-time decisions.
Establish a Culture of Innovation
Digital transformation in banking is more than just technology upgrades. Financial organizations must establish an organization-wide culture of customer-centric innovation. They must use real-time data and insights with advanced technologies to determine marketplace opportunities and unique solutions that align with the business objectives.
Establishing a culture of innovation allows them to find incremental changes to existing services, supporting customers’ growth and retention and creating better experiences. Employees who adhere to this can use their empathy, creativity, and innovative spirit to move the organization forward.
Prioritize Customer Journey
A financial organization’s digital banking transformation strategy should focus on the customer experience. However, many businesses are unaware of the gap between a good digital experience and what they can deliver.
Companies, for example, can start by making the new account opening and digital borrowing operations seamless and rapid. It eliminates “lost business pay” for engaging with a third-party solution provider, increases efficiency, and lowers operating costs.
Hire Digital Skills and Improve Digital Training
While financial organizations still embrace the hybrid work model, how businesses hire, train, and engage with employees is a crucial factor impacting the workforce. While companies plan and employ a workforce with digital and analytical backgrounds, they must prepare to reskill the existing employees for a digital future.
It may sometimes mean shifting responsibility past transaction processing and closer to customer service and engagement. It involves training the employees to use the latest tools available.
Collaborate with Third-Party Solution Providers
Financial organizations can partner with third-party solution providers for enhanced customer operations and experiences. As per a recent report by Sopra Steria, “Digital Banking Experience Report 2022,” 65% of the banks prefer third parties rather than build homegrown solutions since they need assistance to cope better with the evolving forces in the industry.
As businesses are adopting digital transformation in banking, here are some queries they must ask the third-party solution providers.
- Which initiatives are simple to implement that significantly impact the customer?
- Who are the best solution providers with the adequate skill sets to assist with any initiative?
Most solution providers have assisted businesses in the digital banking transformation journey. Their expertise will help companies save money and generate more revenue to balance the investment in the partnership. Financial organizations can partner with fintech providers. They can save time and expenses and might help flag and address critical issues.
Adopt the Change
One of the biggest challenges of digital transformation is company wide acceptance of the needed change. Banking industry is no different. The changes are simple, from modifying back-office processes to moving at the speed required to succeed in a digital banking environment.
Unfortunately, financial organizations believe customers prefer to conduct all the processes in branches. As per a recent report by Accenture, “Global Banking Consumer Study,” 63% of customers said most of their mobile banking logins are just to check their account balance.
Financial organizations must meet the evolving needs of customers and prospects and aim to offer exceptional digital experiences. Digital banking transformation is the key to achieving these goals.
Evaluate the Financial Impact
Financial organizations must understand how digital transformation will impact their business model. They must set strategies to manage expenses and enhance performance to initiate the transformation process successfully.
They must consider factors like impacts on business partners, customer lifetime value calculation, and the journey consumers will take to engage with businesses.
Establish Consensus and Acquire Internal Buy-In
Before organizations replace outdated tech with new upgrades, they require support from across the organization. It is because the digital banking transformation impacts all aspects of the organization, such as IT, sales, marketing, compliance, and risks.
Adequate support ensures alignment and allows employees to learn about the nature and importance of the project.
Evolutions in financial services are never-ending due to constant increases in scope and intensity. Moreover, customer expectations will not vanish around receiving robust digital experiences.
Financial organizations must realize that digital transformation is fundamental. It connects businesses, employees, customers, and stakeholders in a well-defined digital ecosystem.
Digital transformation of banks enables them to use data, human resources, and analytics to build a competitive brand.