For much of the past decade leading up to the end of 2020, financial institutions have been labeled as leaders or laggards according to how big their technology budget is or how fast they can launch a new app. While digital transformation in banking has absolutely been necessary, the rules of the game for successfully achieving digital-savvy status have been ambiguous—and the standards for successful digital transformation are rapidly rising. In the 2021 Digital Banking Report, about 50% of firms stated they are just beginning to work towards digital transformation while only 5% believe they have made the transition fully. Many seem to have become daunted by the task and internalized the idea that they cannot innovate, reimagine and become leaders in the new era of digitally-native banking.
At Temenos, we know at our core that our clients are capable of thinking and moving forward quickly with creative, effective solutions–through the difficulties that 2020 brought, we’ve seen time and again our clients achieve things they previously thought impossible. 2021 is the year for financial institutions to define what being a leader means by embracing and generating continual, positive change that transcends labelling institutions as innovators or traditionalists. This year, meaningful change will happen during the in-between space of knowing where you want to go and where you find yourself now.
2021: The Year of the “Changemaker”
Changemakers are leaders, disruptors, pioneers and risk-takers who believe in changing the landscape of banking by leveraging the power of technology. They unleash the full power of people, processes and technology to imagine, create and deliver outstanding banking experiences to people all around the world. Not only are there notable changemakers at the organizational level, but there are also teams and individuals within each organization who embrace the inevitably of digital transformation and help build momentum in ways both big and small. Even the most incremental movement towards digital transformation is vital progress that will ensure financial institutions have a place in the future of banking, one that they have identified and carved out for themselves.
When we think of the changemakers within our client community at Temenos, they have three main things in common: purpose-driven leadership, an obsession with providing amazing customer experiences and partners that support their vision for change. Looking to the 2021 Digital Banking Report, there are several insights into how financial institutions are currently integrating changemaking mindsets and behavior into their strategy, as well as areas where there may still be disconnect from what it means to become a digitally-transformed organization.
- Purpose-Driven Leadership
Changemakers have a clear vision for where they are headed, even if the journey in front of them is long and winding. This singular focus on a future supported—not dictated—by technology is a key element to staying on a proactive path to digital transformation, rather than simply reactive decisions to shifts in the market, customer behavior, etc.
2020 was a highly reactive year for many, but organizations who wish to integrate the lessons from last year into meaningful change in 2021 must look past the immediate “now” and towards the strategic foci that will have real impact on their digital transformation journey. While many organizations cite post-pandemic adjustments and catch-up activities as having top billing in their 2021 digital strategies, real changemakers will keep their eyes on the prize and pursue innovation initiatives, new technology investments and top talent to get ahead.
2. An Obsession with Customer Experiences
At the end of the day, changemakers are driven by their relentless desire to make banking better because they want to make their customer’s lives better. New apps, gamified products and flashy interfaces only go as far as the customers who use them—and financial institutions realize this now more than ever. The importance of customer experience rose by 10% compared to last year’s findings, indicating just now vital the customer relationship has become in separating the wheat from the chaff.
True investment in the customer is grounded in mature, advanced data analytics capabilities, which is also an area of increased importance in 2021. At Temenos, we see our changemakers working in true interdisciplinary fashion across leadership viewpoints, from sales, marketing, IT, customer service and every team in between to create robust, data-rich profiles of customer needs and behavior, both now and their anticipated future trajectory.
3. Partners That Support a Vision for Change
The previous two traits of changemakers are rooted in a common theme: change does not happen in a vacuum. Meaningful innovation and digital transformation within banking occur at the intersections between people, processes and technology, and require sustained systemic effort to happen successfully.
This often means looking outside current systems to find unique ways to partner with like-minded people and organizations that provide vital insight, services and capability to facilitate change. This can be a scary prospect, especially when the potential partner may also be perceived as a potential competitor: over one-third of financial institutions remain opposed to working with fintechs in the foreseeable future. Fintechs are certainly not the only partners that can help institutions navigate successful digital transformation, but changemakers know that the future of banking is rooted in a digital ecosystem that brings together a platform of services. Building this ecosystem requires flexible, scalable platforms that enable simple, efficient connectivity with a wide variety of services.
Join the Ranks of Changemakers Who Are Making Banking Better
2020 brought into sharp focus the reality that change happens continually whether institutions are ready for it or not: there will never be one specific, perfect moment to take the leap. 2021 marks a time where financial institutions can decide whether they want to stay a course that inhibits growth or embark on a new journey towards a solution for better banking. Institutions across the board have an opportunity to be courageous, and, at Temenos, we have seen countless clients take that opportunity and flourish beyond what they imagined was possible.
Changemakers come from all communities with all types of expertise and creative approaches to serving their customers. What they have in common is a willingness to show up, do their homework and do the hard work of implementing new systems with partners that have the same passion for digitally-transformed, customer-obsessed banking that they do. Now is the right time to rewrite the rules of what true innovation looks like and define the people, processes and technology needed to become one of the changemakers.