Digital Transformation Process - How to Deal With It?

Banking

Published 06 Nov 2024
6 min reading
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Digital Transformation Process - How to Deal With It?

In 21st-century finance, traditional ways of doing business no longer suffice. Advancements in digital technology are reshaping the status quo, and the global shift towards digital transformation in banks and financial institutions—driven by initiatives such as Open Platforms—fosters innovation and enhances capabilities. But what exactly is digital transformation?

What is the Digital Transformation Process?

Digital transformation involves fundamentally redefining how organizations operate and deliver value to their customers by integrating digital technologies into all aspects of their business. It emphasizes the need for continuous adaptation and cultural change within organizations to stay competitive in an increasingly digital world.

For companies, this transformation may range from automating a few manual tasks to overhauling entire processes. Successful digital transformation requires a new mindset and strategic alignment to enhance business models, integrate digital technologies effectively, and drive significant changes that lead to improved efficiency and customer experiences.

The Five Steps of Transformation

Digital transformation efforts can feel overwhelming, but by taking it one step at a time, you can navigate the process effectively. Here are the key stages for banks and financial institutions:

Don’t Break the Current System

Don’t jump in without a clear plan—the first step is to identify your exact goals and objectives. Transformation should proceed gradually, with the existing system still in operation.

Ask yourself: Where do you want to be in the long run? Once you determine this, you can create a roadmap to reach your goals. In the case of developing an open banking platform, you might aim for a more agile online banking experience that improves with customer feedback. Aligning your digital transformation strategies with these goals is crucial to ensure effective implementation and adaptation to market trends.

Microservices of Technology

Microservice of Technology

Delivering top solutions like mobile banking apps, online banking systems, and personal finance tools requires the use of the latest microservices technology. Platforms like Comarch offer solutions based on microservices and open APIs, enabling faster delivery without vendor lock-in. This allows for flexible scaling and expansion of offerings in collaboration with both banking and non-banking partners. The goal is always to optimize customer experience and meet evolving expectations.

Module by Module Implementation

Module_by_Module

This is where you can start integrating digital tools. For banks, this may involve implementing AI and machine learning, facial recognition, or real-time data-driven decision-making. With an open platform, you can integrate different software solutions for both the back and front ends, implementing each module sequentially to best meet your business needs.

All Banking Services

The reality of digital transformation in banking is that it doesn’t stop with acquiring new technology. Existing banking services must be transferred to the latest technology and supplemented with new value-added services. To make these initiatives successful, it’s essential to invest in training, change management to help employees adapt to the new open banking platform, and, in some cases, workflow adjustments.

The Highest UX Standards

Even after completing most of the transformation, the work isn’t done. To ensure your efforts are successful, you need to regularly review and optimize your open banking platform to future-proof your bank and stay up to date with digital transformation trends.

Watch more about Digital Transformation Process

Why Does Digital Transformation Matter?

While digital transformation may sound like a buzzword, it is now more critical than ever for banks to embrace this trend. With more customers looking to perform their banking tasks online, banks must leverage digital channels to enhance customer engagement and adapt to changing preferences.

Investing in innovation-driven tools, such as online banking platforms and artificial intelligence, can streamline operations, reduce costs, and improve customer satisfaction.

Key Technologies for Digital Transformation

In digital transformation, the right technologies make all the difference. These technologies form the backbone of any successful strategy, driving innovation and efficiency across business processes. While digital transformation offers numerous benefits, it also poses challenges and risks that businesses must navigate. Key areas of focus include:

Start Small, Scale Big

Rather than addressing all issues at once, start with smaller parts of your current solution. For example, begin with a pilot project in one department, such as a new online banking solution or AI-based process automation. You can then scale it across the entire organization.

Digital transformation leaders play a crucial role in guiding these initiatives, ensuring the return on investment is measured and maintaining a holistic view of all digital efforts.

Leverage AI for Better Decisions

In finance, leveraging AI supports potential automation of employee tasks and provides predictive insights to help make better-informed decisions.

Embracing Digital Transformation Initiatives

Embracing digital transformation is straightforward, but to grow your bank and streamline operations, you must rethink how you work. Fortunately, new technologies such as AI and open platforms can facilitate this process, allowing you to leverage these tools to achieve business success.