Today’s pace of innovation and constant change heavily affects the financial services industry. To meet consumer demands, financial services leaders need to implement a more significant digital foundation to stay competitive.
The first step to creating a more digital foundation in a financial services firm is to adopt technology collaboration. Today, digital technology is collaborative, mobile, cloud-based, data-driven, and customer-centric.
Gartner studied how financial services firms bring value to organizations’ digital foundation and approaches to digital transformation. For instance, in traditional business, 26% of companies rely on conventional business growth within their existing markets instead of change with new technology versus 12% of financial services firms are mature to digital transformations in the industry. These characteristics consist of data monetization, using blockchain, artificial intelligence, and augmented analytics.
The Future of Financial Services
According to McKinsey, financial services firms will see profits decline by 20%-60% if firms fail to evolve in this digital world. In the financial services industry, the model is designed to create the highest possible short-term returns, so investors will need to rethink these timelines in the future to be successful. The differentiator in financial services for implementing technology has the ability and vision to execute this new change and take risks for a thriving long-term landscape.
The Digital Transformation Process
The journey to a digital organization is greater now more than ever. To boost success in an organization, creating values that are resilient to change, risk, and a transformative future will be crucial in the long run. According to Deloitte, here is how an organization can create the digital transformation process:
- Convincing investors: Financial services firms can help investors understand the change of disruption from customer preferences to technological advancements and the long-term benefits for the digital transformation with a roadmap. This process is a continuous journey for getting investors to gain trust, and financial institutions need to plant seeds for digital transformation continually.
- Creating a culture of transformation: Two ways to create an engaging culture in light of being more digitally savvy is to demonstrate that the process should not be expensive or labor-intensive and brings in new talent with fresh perspectives.
- Having digital leadership skills: Financial services firms are always seeking technology-savvy employees. Finding employees who retain data talent is challenging, but finding individuals who seek opportunities to work in cross-functional and non-hierarchal environments is essential, as well.
- Creating the right organizational structure: This approach helps experiment with organizational culture design to transform team roles and responsibilities to build on strengths.
- Engaging with external partners
Being customer-centric, creating strong organizational values and strategies, considering talent and culture shifts, and collaboration will all play critical toles in digital transformation efforts. These firms must take these themes into account to stay competitive and create advanced personalization for consumers.