In our last post, we touched upon what is holding back digital transformation in financial services and revealed the top three roadblocks organizations face when looking to implement new technologies: legacy technology and infrastructure (31.6%), a lack of enthusiasm and support for change (33.7%) and a lack of in-house technical skill (29.5%). We then delved deeper into the first of the three challenges—legacy technology and infrastructure—that stood out as a result of our survey based on 95 middle- and senior-level managers. Now, in our final part of this three-part series, we will examine the last two challenges and discuss logical next steps for companies looking to build sustainable innovation.
For challenge #2—lack of enthusiasm and support for change—we began by asking respondents what they saw as the greatest opportunity for digital transformation at their respective organizations. One third (35.8%) agreed that it’s office efficiency and, following that, 12.6% identified business intelligence. While these two certainly hold significant promise, they are also seen as relatively “unsexy” when pitted against buzzwords like “AI” or “blockchain”. We can see why it would seem easier to rally stakeholders around initiatives that deploy the latest technology trends, but financial service organizations looking to compete with fintech, need to stay focused on projects that will move the entire business forward.
36% SEE BACK OFFICE EFFICIENCY AS ONE OF THE BIGGEST OPPORTUNITIES.
Another deceivingly exciting opportunity came from a third (33.7%) of respondents who saw marketing online and physical customer experience as the biggest opportunity. The issue here is while customer-facing initiatives seem to be a great place to start, they’re usually driven by marketing budgets that often translate to limited financial support. It’s better to dive into projects on the back-end that will ultimately affect the customer and in turn, improve their experience.
One interesting finding from the survey is that most organizations (61.1%) reported every technology deployed is a company-wide initiative. However, over a third (38.9%) said technologies are selected and deployed by independent departments or lines of business. This finding raises a red flag, as one of the most common pitfalls we see with clients before coming to us is a lack of alignment among stakeholders. Digital transformation is about business process and organizational changes, not just the technology, so having the entire team working on ways to build on technologies being deployed throughout the organization is extremely vital from the start.
A more surprising finding is that for only 1 in 10 organizations (11.6%), all roles—including IT, marketing, sales, product development, the executive team, and outside consultancies—will lead new technology initiatives. The best method for digital transformation success is having overall alignment across the organization, especially when it comes to enthusiasm and support, so we encourage involving every facet of the business in digital initiatives. But with this many departments involved, keeping budgets, visions, and timelines aligned could be an even bigger challenge and it is even more imperative that you have a process in place to stay on top of it.
Challenge #3 is the lack of in-house technical skill, which often leads to businesses enlisting the help of outside consultancies. Unfortunately, survey respondents who reported previously working with large consultancies—such as Deloitte, IBM, KPMG, or Accenture—said their projects failed 42.1% of the time. Of the respondents who reported problems working with large consultancies on digital transformation projects, 42.1% cited budget as the biggest issue, 31.6% cited timeline, and 26.3% cited communication. These problems are interconnected—when teams and their consultancies don’t communicate well, they can fall out of alignment and once this happens, any hiccup in the timeline can throw off the project and the budget. What once looked to be a smaller issue can quickly snowball into a much more threatening one.
42% OF THOSE WHO WORKED WITH A LARGE CONSULTANCY, SAY THEIR PROJECTS FAILED.
So, how can financial services organizations prevent digital transformation failure? We at Janeiro Digital regularly encounter financial services companies struggling with one or all of these three challenges. Our proficiency in helping businesses beat the odds and achieve successful digital transformations is what led us to develop the Rapid Alignment, Design, and Development (RADD) methodology—a two-part strategic approach that first lays out a realistic roadmap for product strategy, user experience and technical design, and then develops the solution in a way that ensures they are delivered on time and on budget to meet your business objectives. You can read more about how RADD works here.
Fintech is currently at a tipping point, and in the years to come, we will start to see those that embrace innovation and digital transformation thrive. And it doesn’t have to take years. We’ve seen rapid growth with our clients who have taken the initiative to innovate. Take a deeper look at how we helped one financial services organization successfully launch multiple initiatives, reduce operational support costs by 85% and achieve 10x market growth in under two years.
Taking action and approaching technology in a practical and sustainable way is necessary if you want to prevent your organization from lagging and possibly fading away—and our team is ready to help. Drop us a line so we can discuss your digital transformation goals and obstacles and help get you started on your journey.
To read our survey findings from the beginning, we urge you to download the full 13-page report or start from the beginning and read the full blog series:
51 percent of financial services companies believe existing tech is holding them back
This post originally appeared on betanews.com … Legacy technology can be a major obstacle to digital transformation projects and, according…Read more
Introducing XFORM for Financial Services
PRESS RELEASE | BOSTON, February 6, 2018 Platform Provides Suite of Components for Building Clean, Scalable, Secure and Flexible Financial…Read more
How to Be Successful with Digital Transformation Spending
This post originally appeared on paymentweek.com … Digital transformation technology spending continues to grow across all geographies and industries. IDC…Read more