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How Banks Can Get Ready for a Digital Transformation

A large segment of the Banking Industry is not yet to embrace large scale Digital Transformation. This might sound astonishing but a reality check on today’s Banks will reveal the actual story. This puts them at risk of lagging behind in terms of competition and under constant security threats (Data Loss, Connectivity Failures, Delays & Frauds). In the long run, several renowned traditional banks are at the risk of being obsolete if they are unable to incorporate a Digital DNA in their day to day operations.

Some of the most common traits associated with Banks with respect to under preparedness to embrace digitization are

  • 1. Legacy Systems which are slow and incompatible with modern Digital Tech

  • 2. Older workforce which is not highly tech savvy

  • 3. Traditional Business Model

  • 4. Lack of Specialized Teams & Departments

In order to become Digitally stable and potentially competitive, banks must ensure that they approach digital transformation with a fixed plan and a logical approach namely

  • 1. Implement and use AI & hybrid cloud

  • 2. Reinvent Digital Payment processing

  • 3. Use Cloud as a platform

  • 4. Develop Omnichannel products, services & applications

  • 5. Incorporate robust Data Security protocols

A holistic approach towards Digital Transformation would allow traditional banks to succeed faster in adopting a Digital Future.

What are the impediments banks could encounter on the road to digital transformation? And could starting the right way help mitigate some of those risks?

  • Is digital transformation for banks necessary?

Mounting regulatory pressures and an onerous compliance landscape, constrained margins, rapidly evolving customer expectations, intense competition, and the rising competition from neobanks are putting traditional players in the sector in a tight spot.

The only way banks can overcome each of these challenges with precision is with agility, data-driven strategies, and targeted activity. That can, in turn, be achieved by digitally transforming the organization end-to-end.

Transformation can not only open doors to a world of new business opportunities; it can also help personalize and improve the banking experience for customers.

A directed transformation strategy and continuous improvements can result in multiple benefits including a superior customer experience based on:

  • Anytime, anywhere banking, allowing customers to use any device to carry out banking transactions.

  • Save customers the time and effort of physically visiting banks and leverage a world of banking opportunities at their fingertips.

  • Receive 24x7 online support and service – all year round – and even on public holidays and weekends.

  • Quicker and more reliable banking operations – without incurring any additional stress or fees.

There are also several operational benefits, like:

  • Equip banking staff with the best technology and tools to meet evolving customer needs and serve customers better

  • Easier tracking of customer details as well as streamlined management of personal information to drive more insightful engagement strategies.

  • Automation of repetitive tasks and customization of workflows for increased productivity and efficiency

Tips for successful Digital Transformation in Banking

To begin the digital transformation journey in the right way, banks have to develop an all-encompassing strategy to revisit their distribution model, revise and enhance sales processes, and develop comprehensive customer-centric processes that can drive growth as well as customer satisfaction.

Here are some tips for successful transformation:

  • 1. Define a comprehensive customer strategy:

One of the first steps towards successful digital transformation is defining a comprehensive customer strategy. This should include the long-term vision of the business and the distinctive values and experience that the company wants to deliver to customers while constantly adapting to new customer journeys and consumption patterns. Banks should also define how they plan to acquire new customers and what new services they need to launch over time to enable interactive and intuitive experiences.

  • 2. Prioritize investments:

No matter how tempting digital transformation might seem, it is critical for banks to take it one step at a time: instead of attempting a transformation across the enterprise, it may make more sense to identify areas which will benefit the most from digitalization and prioritize investments in a way that drives consistent and continued value.

  • 3. Keep up with emerging trends and business landscape:

The banking landscape is constantly changing. New threats, regulations, and technologies are emerging. Successful digital transformation requires banks to keep pace with these changing trends and devise strategies and experiences that align with the evolving landscape.

  • 4. Build a culture of shared responsibilities:

Digital transformation also requires banks to shift away from traditional and rigid business structures and hierarchies and build a culture of transparency, collaboration and shared responsibilities. Empowering employees to contribute ideas, be open to new agile ways of working, and have the willingness to take risks will go a long way in ensuring sustained transformation.

  • 5. Implement modern technology:

Modern technology is a critical component of digital transformation; therefore, embracing cloud, adopting DevSecOps, and delivering mobile-based services are important to meet evolving banking needs while strengthening security and streamlining costs. In addition, implementing technologies such as intelligent automation can help automate day-to-day activities, allowing banking staff to get away from mundane activities and focus on innovation and delivering an elevated customer experience.

  • 6. Enable enterprise-wide collaboration:

Digital transformation also requires banks to enable meaningful, enterprise-wide collaboration. The more banking employees communicate and interact with each other, the more easily they will achieve a shared vision. By aligning workflows and defining ways to work together at different levels of the organization and across different teams, banks can build trust, promote transparency, and drive increased engagement.

  • 7. Enable a data-driven mindset:

With data becoming the new oil, banks have a lot to gain from enabling a data-driven mindset. Collecting the right data sets and using the right tools to analyze them can help unearth critical insight into current trends, customer preferences, and competitive pressures. It can also throw light on ways to improve current business processes while enabling banks to make faster, forward-looking banking decisions.

  • 8. Make it continuous:

Digital transformation isn’t a “once and done” activity, with a set start and end date. Instead, it must be viewed as a continuous process. The right approach requires banks to keep embracing new technology advancements, adapt the business to the latest trends, and keep learning and evolving to maintain customer satisfaction and trust.

In addition, banks must increase their agility by adoption of Hybrid cloud. Plus, banks also need to remove compartmentalized approach towards service & product management. They also need to ensure that

  • 1. Security is embedded within the API Driven Application Modernization

  • 2. Speed of transformation does not reduce resiliency

  • 3. Customer satisfaction is not compromised at any step

Successful digital transformation in the banking sector requires a shift in mindset and a continuous focus on how to drive better value for customers. Building a comprehensive customer strategy, enabling a data-driven mindset, rethinking how they engage with customers at every touchpoint, and empowering them with the latest tools and technologies, will go a long way in achieving the goals of digital transformation, i.e. stronger customer relationships and exceptional growth.

How ITPN can assist

ITPN is a top quartile global Information Technology firm that offers advisory, consulting, and end to end IT competency services (Digital Transformation, Infrastructure Services, Application Services, Application Security, DevSecOps, Automation, ITSM, CMDB, Cloud Solutions, Information Security, DR, Resiliency & Project Management) to Fortune 500 and mid-size customers across the United States of America and Europe.

It offers Industry-leading subject matter experts with pioneering experience in the successful development and implementation of new-age digital strategies by using advanced technologies to reinvent products and services from architecting and engineering to build and support, accelerating operational effectiveness, efficiency, and enterprise-wide growth.

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