The challenges facing financial services en route to transformation
Digital transformation is often referred to as a sort of road. The beginning is uphill and it’s hard to get started. Later, you see obstacles ahead blocking the way. When a finish line appears in the distance, a new road appears beyond that. But setting the metaphor aside, the point is that digital transformation is critical for the demands of customer experience. Your company must start traveling down the road, and the sooner you do, the better. With research from Liferay, WBR Digital created a report to explore the financial industry-wide transformation taking shape. Based on the findings, we’ve illustrated survey data, sampled from digital leaders in banking, to show what the landscape looks like, where the competition stands and how to jump the hurdles waiting ahead.
Getting Started
It’s no surprise that an overwhelming majority of digital leaders at banks recognize the intrinsic role technology plays in digital transformation. What’s alarming is the 56% of respondents that claim access to IT resources as an obstacle. Thus, a cycle emerges. Stakeholders are aware of the significant investment that must be available for effective transformation, but it is difficult to get approval for an appropriate, multi-year budget. Business executives and IT leaders must work together to prioritize a digital transformation strategy that is owned across departments.
The Journey Ahead
Especially for large enterprises, updating technology takes time. According to banking leaders surveyed, 49% of companies consider their strategy halfway completed, 37% of financial institutions are beginning to roll out their strategy and only 13% of respondents report completing (or being close to completing) their digital transformation strategy. While these mile-markers are somewhat subjective, companies past the imaginary midpoint have likely created a strategy and are integrating existing with new technology. Banks are building their digital strategy with digital experience platforms that can address immediate problems and prepare for scalable growth.
Obstacles en Route
The challenges facing banks along this journey are largely operational. This includes lacking any central repository for customer information, or a problematic volume of unstructured data (and the inability to contextualize customers and their needs, because of disorganized data). The good news is that understanding these barriers makes it easier to overcome them. While no specific obstacle takes the lion’s share of the challenge, some impact revenue more than others.
In order of agreement, these are the top three challenges for banks seeking an omnichannel customer experience: availability of IT resources, regulatory compliance, fragmented data resources. It’s interesting that almost the same percentage of financial businesses who consider their strategy halfway completed are also taking the time to create continuity across all customer touchpoints. This will ensure success in the immediate and long-term, as customers prefer companies with interconnected digital experiences.
Are We There Yet?
Transformation requires vision. And vision requires strategy. In order to build momentum, respondents identified that to execute such a strategy, banks must build a system for better collaboration. Creating a cross-departmental digital team and promoting a flexible culture are essential when preparing for operational change. It’s no longer applicable to rely on marketing for everything related to customers. In agile, the customer comes first, no matter what team you’re on.
For more information on digital transformation facing financial institutions today, read the report.