Digital transformation, is it a necessity to support the business model or a means to look cool in the age of millennials? The speed to innovate and excel has diverse definitions for every banking and financial institution, be it public or private. However, despite having a different meaning for tech-leaders from across the BFSI sector, it is now a part of everyone’s priority list. Rashi Aditi Ghosh of Elets News Network (ENN) explores the depth of the new sensation ‘Digital Disruption’.
What lies beneath? Unravelling Digital Disruption…
According to mckinsey.com, Digital Disruption is a way to understand how technology is transforming industries and how leaders and organizations can respond.
Gartner defines Digital Disruption as an effect that changes the fundamental expectations and behaviours in a culture, market, industry or process that is caused by, or expressed through, digital capabilities, channels or assets.
Why do we need it?
Forbes believes that Digital disruption is much more than an abstract concept promoted by analysts and vendors; it is now a reality for most organizations. A survey titled Forbes Insights/Treasure Data survey reveals that more than one-third of executives, who participated in the survey, say they are being directly affected by competition from digital and data-savvy players in their markets.
Furthermore, a majority of executives conveyed that the risks of digital disruption are high, and many are already feeling the impacts. Around, 51 percent of the executives surveyed report a high level of risk to their organization (in terms of market share and revenue) over the next five years from technology-driven disruption by start-ups or innovations by incumbent companies.
Digital Disruption and BFSI: What’s the connection?
Digital platforms are a pivotal and critical mechanism for appealing with both existing and potential customers. It is the age where social networks have become significant tools for sales, marketing and communication. Digital platforms can now facilitate banks’ and financial institutions’, irrespective of their geographic location, via nextgen software and automation systems.
What do experts think?
Leading technology experts from across the Banking, Financial and Insurance (BFSI) sector during 4th BFSI CTO Summit organised by Elets Technomedia in Mumbai congregated to discuss the significance of Digital Disruption and the diversifying role of technology leaders in sync with it. While some called the new rage as the way to radically changing the customer experience, others termed it as the source to support the business strategies. It was always named as a way to deal with matters beyond the human mind’s comprehension and the bridge to connect the old to the new.
Joydeep Dutta, Executive Director & Group CTO, Central Depository Services Ltd
Digital disruption enables you to either create a new business model or radically changing the customer experience, using a process which is completely different from the techniques that were used traditionally. However, just doing incremental digital will not help; the implementation should be a gamechanger for disrupting the already existing scenario.
Kersi Tavadia, Chief Information Officer, BSE Ltd
Every digital journey is a continuous and inevitable one. You cannot decide a goal post for your digital initiatives. Because by the time you reach your decided destination, the whole dynamics change. So, it is important to inculcate calculate of innovation rather than just a culture of working for the sake of it. For us at BSE, we believe in the philosophy-the end is always a beginning.
Kirti Patil, EVP & CTO, Kotak Life Insurance
Most of the organisations do digital innovations and make an investment in promoting it by emphasizing on the customers. But we at Kotak are very focused towards our agencies as well. Because no customer in the morning will wake up in the morning and say that I want to buy a life insurance policy. It is well known that only a single-digit percentage of business comes from customers directly. So, we want to start our digital journey with distributers.
Jaya Vaidhyanathan, President, Bahwan CyberTek
From a transformation perspective, it is important to implement something which can go beyond what a human mind can comprehend. Technology should act as an enabler in helping humans take sensible decisions. Artificial Intelligence, Machine Learning can be really helpful in early warning systems. It can act beyond human limitations.
Amit Saxena, Global Deputy CTO, State Bank of India
State Bank of India is on the path of transforming itself. The journey that we are envisaging is to convert the whole of the bank into a digital platform, right from the customer onboarding to the lending department. The services that we would be offering will be in sync with the customer’s needs and feasibilities. We have put the customer at the centre. For example, if a customer keeps an Average Quarterly Balance with us, we may offer him a car loan for their children on their convocation day because we know the payback ability of the parent.
Sumeet Puri, Senior Vice President & Global Head of Field Technology, Solace Corporation
Digital transformation is all about leapfrogging from one set of practices to another. Customers could be paper-driven from the rural areas or they may belong to the urban scan and pay segment, transformation must include everyone and should cater to everyone’s necessity. In my view, digital transformation, if built around events, is often faster and agile.
Manish Shah, SVP & Head- Mobile and Internet Banking, Kotak Mahindra Bank
Digital transformation is not relevant if it does not support the business strategy. Prior to taking a step towards digital innovation, it is significant to first define the strategy for the bank. Digital marketing may help you look cool at a lesser cost and you may emerge as an upbeat brand but in my view, this should occupy less than five percent of bank’s plan and rest 95 percent of digital help should back the business strategy.
Rajesh Dembla, Mentor & Advisor, MOBtexting
Banking experts believe that technology should help in building customer experience and generating revenue alongside cost efficiency. MOBtexting is exactly doing the same and partnering with the banks over the months with the mentioned motive. We have launched Adept which is our omnichannel Artificial Intelligence-based voice and chatbot. We unveiled it with a view that it can be customized as per the bank’s need and priorities. It integrates Alexa and Google Assistant as well.
Listen to the complete discussion below: