Why Defining Success Is the Secret to Digital Innovation for Financial Services Firms – Irish Tech News
A greater understanding of technology among C-level executives within financial services firms and banks has seen some of the reluctance to sign off new technology investments begin to dissipate. Yet, many remain unclear about what they want to achieve from implementing new technology and are unable to measure the success of such initiatives.
Consequently, this lack of understanding and stated aims is resulting in a large number of projects being deemed to have failed or stalled. This is, in turn, creating renewed hesitancy among some senior leaders to embrace new solutions – which is having a significant impact on their ability to innovate and remain competitive.
This calls for firms to overhaul their approach to technology investments and implementations. Key to this will be defining exactly what success looks like from the outset of new technology projects and taking the time to learn from previous mistakes.
Avoid a knee-jerk reaction
If firms are to optimise their use of new technology, defining exactly what success looks like and how this will be measured ahead of implementing new technology is vital. This approach will be particularly beneficial for traditional firms which are facing stiff competition from innovative fintechs and digital-only banks, for whom technology is their bread and butter.
That said, traditional firms shouldn’t be motivated by a knee-jerk reaction to adopt new technology purely based on what they see competitors doing. After all, this tends to cause more problems than it solves, resulting in misaligned technology implementations that don’t work for the wider business. Instead, firms need to take a step back and assess what is right for them and their customers.
An individual approach to technology
Taking this approach requires firms to adapt their mindset and understand that success looks different for every organisation. While for one firm success may be seeing a reduction in fraud thanks to the use of machine learning, another might be focussed on the number of new services it can offer due to more effective use of data.
Regardless of what their aims are, it’s critical that the firm has a clear idea of what its objectives are before implementing new technology and the business outcomes they expect to see. By adopting this mindset, it will become much easier for financial services organisations to determine which implementation projects have been successful and which haven’t, as well as what has gone right or wrong. These valuable insights can then be used to inform and guide future technology implementations.
Taking the time to reflect on projects and to dig deeper into what worked and what didn’t will help firms to understand the best moves to take next and where they can potentially make improvements to ensure their next technology project is successful.
Gaining a competitive edge
Growing competition within the financial services industry has had a significant impact on traditional institutions as the almost monthly news of bank branch closures can testify. Fintechs and digital-only banks, on the other hand, have gone from strength to strength, as demonstrated by the success of Revolut and N26, which now boast around 1.5 million and 200,000 users in Ireland respectively. This growth doesn’t seem like it will slow down any time soon as it is estimated that by 2025, more than one in five Irish adults (22%) will have a digital-only bank account.
By taking a more defined and strategic approach to technology investments, firms will be better placed to compete with these organisations. It will allow them to determine exactly what they want to achieve and invest in the technology needed to become more innovative and provide customers and prospects with the types of products and services they require.
As they explore what they want to achieve through technology, data fabrics with advanced analytics capabilities are likely to become a popular choice for traditional firms. This type of data architecture will empower them to fully leverage all of their data and gain a 360 degree of their customers by integrating all of their data silos and sources of data. In doing so, firms will be able to tailor their offerings to the individual, helping them to deliver real value to customers and giving them a competitive edge.
A solid foundation for future innovation
The right technology investments can make the world of difference for financial services firms and their customers. They have the power to elevate their services above the competition and to prime them for digital innovation. However, they must first ensure they know exactly what they want to achieve from their investments, what benefits each solution will bring them, and how they will measure the success of the implementation.
By adopting this approach, firms will better understand whether or not they are choosing the right technology for the job and can set expectations with the C-suite regarding what returns they can expect on projects.
Not only will this help firms succeed at their technology implementations, but it will also give them a solid footing from which to innovate, adapt to changing consumer demands, and gain a highly sought-after competitive edge.
