Digital native companies tend to be data- and business intelligence-focused. They follow where the data leads and place great value on experimentation and innovation at speed.
Just stop and think about it for a minute: “digital” appears to be overtaking our way of life and how we interact with one another. Whether one considers digital to be the proliferation of devices connecting us with information, entertainment, and services of all kinds in real time, or the constructive use of data and analytics to deliver an ever-improving end-client experience, no business or industry is immune from the competitive pressure to transform its means of delivering value to clients.
As successful as we have been, have we, as global institutions, truly embraced the digital transformation of our businesses in the way we interact and draw insights from our clients, or with the speed at which we operate? Some have made great strides. And, generally global banks recognize both the potential of digital tools and processes to improve productivity and client experience, as well as the dangers of not moving quickly enough. But, on the whole, banks have a long way to go.
So how do we know if we are doing enough to digitally transform our businesses and operating models? Studying “digital native” companies (companies that have, since their inception, built on digital technologies) and the way they drive business success, can help. Digital native companies, freed from legacy assumptions about past best practices, can innovate with a “clean sheet.” As a result, they have a different mindset and a focused approach to their business that banks can benefit by studying and imitating. Consider:
As global financial institutions and payment service providers, we find these highly successful digital native company’s approaches appealing, but challenging to adopt. Our institutions, our organizational structures, and the technology that services them are big, complex, and slow when compared to digital equivalents. Yet we execute and deliver reliably and predictably for our clients, while protecting their financial assets and information. Long-term strategic success will depend on our ability to adapt these business values to new digital norms. Leading FIs are evolving business strategies to strike this delicate balance, adopting such opportunities as digital tools and processes offer. These include:
So how will digital technologies transform the longer-term strategies of global financial institutions and payment service providers? There’s no single answer. But in surveying the landscape of digital native companies, one observes (a) an innovative approach to understanding client needs and preferences through data and business intelligence; (b) service designed around simplicity and self-service principles; and (c) accelerated product innovation through client-centricity and a culture of experimentation and adjustment. Those in our industry that adopt these lessons, while not abandoning the business practices that underpin client trust, will likely be winners.
The views expressed herein are those of the authors only and may not reflect the views of BNY Mellon. This does not constitute Treasury Services advice, or any other business or legal advice, and it should not be relied upon as such.
©2018 The Bank of New York Mellon Corporation.
Managing Director and Digital Platform Officer, BNY Mellon Treasury Services
Anthony (Tony) Brady is a Managing Director and Digital Platform Officer (DPO) for the Treasury Services business. In this role, he manages the Digital Platform team, who partners with the business, technology and operations leadership groups to advance the BNYMellon NEXENSM strategy and Treasury Services’ digital transformation.View Profile