Is now right time to drive Digital Modernisation in this period of economic uncertainty?
Many organisations have stopped or paused their digital agenda, but this can only be a short-term option. Organisations need to be ready to exploit the economic recovery in 2021, which means accelerating the digital journey NOW…. The insight provides a view of what are the goals and outcomes required by a business, and the step principles to achieving what we call Digital Energy through delivery of a Digital Powered Business, and the supporting digital ways of working through the Business Technology Operating Model.
Xonetic seek to provide Financial Services organisations with insight on the current considerations for driving Digital Modernisation in this period of economic uncertainty with COVID-19.
THE CHALLENGE
Contradicting forces are driving the need to increase digital momentum
Today’s banking market, across large retail corporates to the small / medium-sized enterprise (SMEs) challengers, is being reshaped by contradictory forces.
Together these forces are challenging traditional business models to serve personal and commercial/ business customers with greater digital enablement – the “new norm” post Covid-19.
Banks need to establish new/enhanced ways to build, innovate and deliver their services and products digitally. Those that do not will be less relevant and risk losing out in this vital marketplace.
This challenge in creating digital momentum or energy, be that of modernisation or overall strategic transformation for some organisation, is that this is set against a backdrop of economic uncertainty.
ECONOMIC OUTLOOK
The impact of COVID19 drives a reset for many organisations in 2020
The Bank of England governor Andrew Bailey has suggested that the economy shrunk by 3% in the first quarter of 2020, followed by an unprecedented 20.4% decline in April, rising to 25% in the three months to June.
For the year as a whole, the economy is expected to contract by 14%, which is the biggest annual decline on record, according to Office for National Statistics (ONS).
Whilst the 2020 economic contraction has a major impact on Financial Services organisations, the Bank of England expects UK growth to rebound in 2021 to +15%.
We have a brief respite before the economy comes back online strongly – but operating in a new normal.
DRIVERS FOR EVOLUTIONARY CHANGE...
“Digital Transformation is a fundamental reality for businesses today. Organisations of all sizes realise to delay digital transformation further is to risk obsolescence”
Some 70% of companies had a digital modernisation agenda underway, or were working on one, but it seems many were not far enough along the digital journey to absorb Covid-19 turbulence.
For example we have seen dramatic impacts on Telecommunication, based on the ”new norm” of home working, increased cloud usage which allows companies to scale up (and down) the demand of IT capacity or the virtualisation of customer interaction through multiple digital channels.
With the economic impacts, many companies have stopped or paused their digital energy agenda, but this can only be a short-term option. Organisations need to be ready to exploit the economic recovery in 2021, which means accelerating the digital journey NOW….
…TO ACHIEVE DIGITAL ENERGY GOALS AND OUTCOMES
Let Information Technology (IT) be an enabler to Digital Energy
The goal of digital energy, through modernisation, is to use technology and partnerships to solve traditional problems, which means integrating technology into every area of the business model:
Optimisation for Efficiencies, Improved Capability and Cost Savings;
Cultivation of talent through enhanced Ways of Working; and
Evolve Cybersecurity and Fraud Prevention for an Agile and Resilient Defence Posture.
When applied continuously Digital Energy allows companies to provide unprecedented value to its customers, and thus support the growth potential of the organisation in this competitive marketplace.
Based on our experience, organisations should consider six (6) Digital Energy outcomes as part of their digital journey.
THE DIGITAL ENERGY OUTCOMES
The six business outcomes that will drive the Digital Energy of your organisation
Powered Customer Experience
The delivery of enhanced Customer digital experience through understanding the service requirements and optimal design of your Customer journey against existing and new business products/services, with access through innovative digital channels and the right digital partners;
Safe and Secure Technical & Customer Environment
Improved security of products and services for your Customers within a constantly evolving digital global threat landscape. This includes Cyber security modernisation, but also Fraud prevention through enhanced online access/ payment security and automated KYC/KYB i.e.: ID Verification, Customer/Business due diligence AML checks for PEPs, Sanctions and Adverse Media;
Data Driven Decision Making
Harness and exploit external and internal organisational data – treat data as a strategic asset. Accelerate delivery, revenue, cost savings and risk decisioning (speed and accuracy) through AI, machine learning or Robotic-enabled capabilities;
Maintain Regulatory Compliance
Build and maintain people, process and technology compliance against the ever-changing regulatory requirements landscape (PRA, FCA, EBA) i.e.: Operational Resilience1, Outsourcing2, Open Banking, Payments, GDPR, etc….; and
Digitally Enabled Ways Of Working
Build a Business operating model (people and process) that complements the Digital modernisation. This needs to include new agile technology enablement Ways of Working for the workforce across all sectors of the banking environment – the “new norm”;
Increased Revenue & Decreased Cost
With enhanced digitally enabled Customer journey (technology, applications, people and processes, with appropriate Right Sourcing/Outsourcing), this will drive increased speed to market and revenue opportunities, against a lower cost to serve for delivery and fulfilment of new and existing products/services.
…AND THE STEPS to DELIVER
10 guiding principles to create Digital Energy for your business
DEFINE YOUR DIGITAL ENERGY
Define your Digital Strategy
Define a 90-day agile value sprint approach
Secure Executive Commitment
Secure the business case investment
INITIATE
DEFINE YOUR DIGITAL ENERGY
Build an experienced delivery team
Perform a proof of value/concept project
Define new Ways of Working operating model
DESIGN
DEFINE YOUR DIGITAL ENERGY
Define and adopt the new Business operating model
Sequence digital energy deliver to drive quick wins
Communication is king!
BUILD
...CONTACT US FOR YOU FREE DIGITAL ENERGY ASSESSMENT
Xonetic provides advisory and delivery capabilities to Financial Services customers today that drive the creation of a Digital Powered Business, and the supporting digital ways of working through the Business Technology Operating Model. This is what we call Digital Energy.
To find out more why not contact us for a FREE Digital Energy Assessment.
