Every Bank Must Become Digital In Order to Survive

What Does It Mean to Be Digital First?

Being digital involves automating your business systems to minimize the reliance on or need for human intervention. For banks, this could include using computer applications to automate certain aspects of:

• Payment systems

• Business intelligence

• Business insights

• Customer relationship management (CRM) systems

• Virtual sales training 

This means more than merely digitizing a few functions, as banks worldwide have done  for decades. Rather, going digital requires leveraging automated systems to do the kinds of analysis that, previously, only human beings were capable of performing.

For example, without any digital products, banks would have to painstakingly set up a complicated spreadsheet to pull in data from multiple sources in order to assess the potential impacts of varying financial moves. However, with the adoption of digital technologies, a bank employee can use an automated system to do this in just a few quick clicks.

These technologies can provide immense value to financial institutions. From helping manage pipeline more efficiently to providing more data driven insights to customers, digital solutions allow banks to drive more revenue and provide a more streamlined customer experience.

Being digital impacts your bank in several ways. New technologies can greatly improve the processes and the day-to-day work of team members. Most importantly, however, being digital means you provide more consistent, reliable, and faster service to bank customers.

After the implementation of a Business Intelligence system, bank employees can generate insights that would have previously taken hours to analyze.  Not only does this process save bankers time, but it circumvents a range of human errors by drawing data straight from the source.

Challenges of Going Digital

However, deciding to facilitate a digital transformation is not always simple. If banks hope to implement a new digital solution like a BI tool, CRM platform, or sales enablement product, they must reconcile a couple key issues.

First, banks can not just assume that their employees will understand how to use the product and are willing to engage with the new digital workflow. Banks need to be highly aware of what problems the new platforms are solving for employees and provide them with the “so what”? If employees aren’t fully educated on how these digital solutions can affect the bottom line, they will be less inclined to utilize them.

Second, these digital platforms are often built for all industries and not just focused solely on financial services. Because banking has many unique challenges and workflows, leveraging these technologies can often lead to more manual work for your employees to extract the necessary value. These so-called “game-changing digital solutions” can rapidly become a source of frustration amongst your team as they attempt to configure platforms, dashboards, and workflows to best suit their operational needs. This tension can often push banks to bring in third party consultants to best optimize these products to align with organizational goals.

These pain points are why financial services organizations are increasingly looking for vertical specific services that can performs the tasks of multiple systems better, faster, and in a single, unified platform. This new breed of software will greatly streamline internal workflows, while enabling digital channels across the enterprise. Furthermore, it's clear that a key driver of digital transformation in financial institution will be ease of implementation of third party products and solutions. Products that are built around turnkey activation and rapid implementation will appeal more to key decision makers responsible for digital transformations.

What Bankers Need to Know About Digital Transformations

In this digital economy, banks must provide their customers with the digital experience they increasingly expect. The banks who prioritize investing in digital technologies now will be set up for success in the future, while banks who continue to rely on old strategies will find themselves struggling with customer retention in the future. 

Bankers should be aware about just how many different systems they can transform into digital entities. Almost any process that depends on collecting and processing data from different accounts or transactions can be digitized. Furthermore, tracking customer relationships is as easier as ever with the emergence of CRM 

In addition, Bankers must comprehend the basics of how to use these digital tools. Because the back-end architecture of these solutions has been custom-built to meet the needs of bankers, this new breed of vertical specific SaaS tend to be more user-friendly. However, even with a no-code solution, bankers still have to invest some time in exploring how its capabilities align with operational workflows. Although this process may appear daunting to those without a technical background, it is a necessary step in proceeding with a digital transformation.

Being a digital first financial institution is a significant commitment- it requires alignment across the whole organization, from training to workflows to reporting. However, the benefits are clear. Digital technologies can help more efficiently manage pipeline and create a world-class customer experience. Furthermore, customers are increasingly expecting to engage with digital products when interacting with their financial institution. When it comes to the future in today’s digital economy, every bank must become digital in order to survive.