Finance firms can’t allow technology to dictate business strategy

The pace of technology innovation in financial services is putting companies across the sector under pressure both from customers’ expectations and new fintech-focused rivals. The counter-intuitive solution may be to abandon the transformation mentality altogether.

There is a real alternative to transformation, and it’s been dubbed digital optimisation - a process aimed at ensuring a firm is prepared to adapt to new technologies and consumer preferences without having to reconsider the way it works at a fundamental level. Digital optimisation means ensuring that a company is using its technology effectively; is fully digital in terms of its functions and processes; and therefore able to leverage its data, human resource and brand into new platforms and formats as the need arises.

Faced with the near impossibility of keeping up with the technological challenges posed by new fintech startups, some financial services firms are already taking this approach. But it does not mean they have dropped their technology aspirations altogether. Far from it, they stand ready to bring on board any new technologies that prove useful and popular with customers.

One of the key aims of the digital optimisation process is to ensure the company is ready to adopt new technologies as they arise. This can’t be achieved without an IT and working infrastructure that facilitates different formats - be that of files, customer engagement channels or workflow. Compatibility is essential in facilitating the use of current technologies as well as future ones, and many an innovation has been made by organisations which have simply laid good foundations for their staff to work with when it comes to IT.

The process of optimisations starts by identifying aims and pinpointing exactly what the business hopes to get out of its use of technology. Once the aims are clear, all systems can be integrated into a modern single enterprise hub system that will be tailored to address those needs.

The hub approach is crucial because the ability share document and for the technologies themselves to be well supplied with data, is at the heart of almost all digital innovations. For example, a digitally optimised financial service provider won’t have data filed away in formats that are hard for staff to access, on different IT systems, or in documents such as spreadsheets, which are difficult to access. Instead, all customer and market information will be available through a single information hub, with staff able to view everything they might conceivably need to deliver excellent service, on a single screen.

Ensuring staff don’t have to switch between devices, screens or desks to view different information is also critical to creating an efficient work environment where customers can be looked after effectively and delays while searching for data are minimised. Digital optimisation ensures that all IT is working for the humans in the business, not vice versa. This is the key to maximising value, as it allows people to offer the best service to the client.

As the business maximises its efficient use of current systems, it can start to think about investing in automation of the tasks that are time consuming but simple. And it can review what new technologies can improve the business and help deliver value to clients. But it will always seek to incorporate any new additions into its existing ecosystem and service mentality, rather than attempting a fundamental technology overhaul every few years. It will also stand ready to invest in any new channels that gain popularity with customers, and will be able to integrate these quickly.

With this approach, staff are not hampered or distracted by a transformation mentality that sees managers attempting to force change on workers. Instead, technology is a facilitator to staff who is dedicated to helping clients, and people feel free to develop uses for existing technology that helps them help the customer.

For financial services firms that already have a brand, a customer base and an established workforce, digital innovation can be the missing piece of the jigsaw that allows them to take charge to their technology journey. Rather than being slaves to technology, they will harness those innovations that are useful and stay relevant to younger clients without losing the trust that is still essential for success in this industry