Digital Transformation in BFSI industry – The need for integrated transformation
'Customer centricity' of Digital Transformation is often misconstrued with a notion that Digitalization is just about transforming the layer of interaction between firms and its customers - intuitive mobile applications, fancy user interface websites, innovative channels to extend services, etc.
However, digital channels also attract up to five times higher transaction volume from the same customer. Are the legacy systems, residing under those fancy mobile applications and websites, ready to handle this volume surge?
Channel transformations typically deliver quick impact towards customer experience, and attract attention from potential customers, but the legacy systems underneath running on batch processing mode, taking several minutes (or hours) to process a request, will end up ruining that experience. And a disappointed customer is far worse than no customer.
What FSIs need is an Integrated Transformation
FSIs need speed, scale, and strength to build their digital empire. They need intuitive 'channels' that are available and preferred by customer segments; simplified business 'processes'; integrated 'data' enabling analytics; and actionable insights into customer and 'core systems'.
With banks setting aside billions of dollars as budget for digital transformation, more than 80% of it will be spent on technology transformation and integrating FinTech innovations in the technology ecosystem. This ecosystem would survive through business requirements of 10X scale, speed, reliability, security, and 20X more adaptable to new innovations.
Sitting on the fence for too long, FSIs now need to aggressively adopt this 'integrated transformation'; a few months too late and they could risk getting swept off by more nimble and efficient service providers. Not to forget the competition from non-traditional players (like Apple, Google, Samsung) impacting the financial services ecosystem as well as customer expectations.
With digital cameras knocking on its doors, could Kodak have afforded a 2-speed change? Businesses need to transform themselves NOW!