The road to digital transformation in Financial Services (FS) has been a long and winding one. For the most part, banks and other FS providers are aware that they need to change and digitise their operations, products, and services.
The past decade has seen the emergence more agile fintech start-ups who are able to offer consumer and business customers banking services in a more digitally-savvy manner. Banks are trying to respond to this, but it isn’t easy.
Recent research by IT services provider KCOM revealed that FS is the least evolved industry as it pertains to digital transformation. Just 34 per cent of FS firms are prioritising digital transformation in the next 12 months – the lowest of any industry – and is lagging behind other sectors in areas such as security and investment in employee training.
But perhaps FS firms have been approaching digital transformation in the wrong way? The first step absolutely has to be modernisation of the information management toolkit within an organisation. Get your Content Services foundation right and the latter stages of the journey are achievable. Fail to lay this foundation, and don’t be surprised if the entire digital transformation house comes crashing down.
Addressing information challenges in FS
In order to solve the information challenges faced by today’s FS organisations, a modern solution is required. For increasing numbers of banks, this solution is a Content Services Platform (CSP).
From a high level, a CSP may look like the Enterprise Content Management (ECM) systems of the past. However, there are three areas in which a CSP significantly differs from an ECM solution:
- Modern: A Content Services Platform needs to be a part of the modern information management toolkit, not built 10 years ago in a time before mobile and cloud had taken off. In addition, it needs to be able to natively and effectively manage all of the data and content types that are used in FS today – video, audio, social media, etc.- not just scanned documents and word files. Finally, it needs to have the scalability do all of this for billions of items. In short—a CSP needs to address the Big Content challenge head on.
- Connected: ECM solutions were designed to be insular—they were sold as the ‘one place to store all of your content.’ As most FS institutions will testify to, that never actually happened.
CSPs take a very different approach. While still having the ability to store data and content locally (in their own repository), modern CSPs are able to connect to other information systems and repositories within a business. This federated content services approach means that they can access content stored in an old ECM system, or data stored in a legacy accounting application—all from a single platform. This is key and provides users with a single hub to go to in order to store and retrieve information across the enterprise.
- Personalised: The modern and connected aspects of a CSP are all about IT and the business – making sure the system scales and systems are connected together. The final element brings the benefit of all of this behind the scenes work to the user—via personalisation.
This is about allowing internal users to store, view, edit, and interact with data and content however they need to. That could be via the CSP interface, but equally it could be via a mobile app, a productivity app (such as MS Outlook), a line of business app, a web portal, or even a custom-built application to perform a specific task or process.
This personalisation capability changes the dynamic of how users interact with information. In the past, the user has had to adapt how they work to find and interact with information. Now the system can be personalised to the exact requirements of the individual end users, a major advance.
Modernizing information management to deliver business value
Putting these three elements together – modern, connected, and personalised—creates a relevant, scalable, and flexible information management environment that improves the customer experience, drives productivity, and has a positive effect on the bottom line. With that in place, the journey towards information management modernisation, and ultimately digital transformation, can begin.
Organisations tend to look at two key drivers when exploring digital transformation: a rapid return on investment (ROI) and a reduced total cost of ownership (TCO). Unfortunately, ROI and TCO often compete against each other, especially when it comes to modernisation.
Rapid ROI can be achieved, by deploying a new system to solve some of the business challenges, and TCO can be reduced retiring old applications as part of that new deployment. But such a ‘rip and replace’ model will invariably fail.
A flexible approach to information management modernisation
However, there is a simple approach that can deliver both ROI and TCO, without the need for a rip-and-replace model. If a bank focuses on the modernisation of legacy applications via a Content Services Platform, with a connect and consolidate strategy for managing information management systems, then there is a better way to progress.
This connect and consolidate methodology for information modernisation can deliver both short term ROI and longer term reduced TCO and can also lay the foundation for further digital transformation efforts.
Because we work in a digital world where information is everywhere, and every operational and business function in FS depends on this information, it makes perfect sense to base any digital journey around this. For any FS organisation embarking on digital transformation in 2019, content services should always be the foundation and starting point.
About the author
Dave Jones is VP of Product Marketing at Nuxeo, a provider of enterprise content management, Content Services and digital asset management solutions for large firms that include international FS providers such as Banque de France, ABN AMRO and BBVA.