EMC’s Patricia Florissi shares tips and insights on digital transformation for banks.
Q. What trends are you seeing in digital banking?
It’s a new era. The rules in banking are changing, offering tremendous opportunity. The question is, are you ready for digital transformation? We define digital transformation as the radical rethinking and redesign of everything that banks do — from the services you offer, to the engagement models your users can experience, to the business models you deploy, to how you structure and organize the internal processes and back offices to deliver all that.
Although banks and credit unions started digitizing some of their functions and operations much earlier than other industries to ensure faster, more secure and precise transactions between banks, that is very different from digital transformation. Digital transformation can be described as reimagining the financial industry and delivering it in digital form.
Larger banks are leading the way. They are creating organizations that are completely detached from the legacy bank. They use cloud native applications, apply a Big Data analytics-driven approach, practice mobile-first and cloud-first design, and adopt a continuous delivery and continuous innovation operating model.
Also, banks are becoming very personalized. Consumers expect that commercial institutions will know them intimately. They will draw on personal data aggregated from digital interactions via the web and your mobile phone. That will be consolidated with your banking information from retail banking, financing, insurance, medical insurance, health insurance, life insurance and others, enabling a very sophisticated level of personalization. The banks will use that data to calculate and not only understand where you are today, but also where you could be or where you should be today, and where you can be tomorrow.
Finally, banks in the era of digital transformation are obsessed with the concept of being accessible anywhere, anytime. It’s also going to be very contextual. For example, if I am touring a college with my child and the bank knows that I am geo-located at the school, the bank will advise me that we can afford to send our child to that college, and preapprove us for a loan.
Q. What are your top tips for banks?
Banks should focus on being Big Data- and analytics-enabled. Data analytics is not just the algorithms or the modeling, although they are very important. It’s about the entire data pathway. It’s the ability to understand how the data flows from origin to many destinations. What is the optimum infrastructure that I want? How do I bring meta data and tag meta data to the data? How do I analyze the data and generate new data that also has a pathway of its own, that comes in a continuous feedback loop to the infrastructure? That is how banks will be able to manage data as a digital asset for differentiation.
Finally, we believe that you must deploy multiple versions of the software in a short period of time to see what yields the highest returns, instead of a spending a lot of time designing something that may fail. The rules of the game have changed and now we prioritize: time to market first, price second and scope third.
This article first appeared in the Fall 2016 issue of FINTALK Report.