“Information is power,” says Jay Rabinowitz, vice president, head of financial services and insurance at Workday. FSI organizations know the truth of that statement as well as anyone.
FSI organizations have nearly unlimited data at their fingertips. But many have yet to undergo a digital transformation that could turn their often-siloed data into valuable, impactful information. The type of information that would allow FSI organizations to provide their customers with more targeted offerings—and boost the bottom line.
Unfortunately, many FSI organizations are encountering roadblocks on their digital journeys. In 2021, only 35% of organizations achieved their digital transformation objectives, global consulting firm BCG has found. According to Workday’s global survey of senior business executives “Closing the Acceleration Gap: Toward Sustainable Digital Transformation,” financial services leaders say organizational culture and analytics are the biggest transformation blockers, at 40% each.
Rabinowitz recently offered his expert insights into the benefits that FSI organizations could reap from digital transformation—and the challenges they’re facing to attain it.
Digital transformation is such a major undertaking. Where should FSI organizations even begin?
FSI organizations need to first focus on data. We talk a lot about how technology organizations, such as Amazon, Facebook, and Google, know so much about us because of how we click on their sites. Our financial services providers also know a lot about us because how and where we spend our money and time informs them. They need to harness that data to drive innovation and growth, provide more robust offerings to their customers, and create a better customer experience.
And just like technology organizations, FSI organizations can make better recommendations to their customers by using data to make more specific, less generic offers. For instance, if customers have a bank account with their financial institution, why don’t they also have their mortgage there? If the customer’s credit score is great, why don’t they have a bank’s credit card? From an insurance perspective, why do customers have their home insurance policy here, their auto insurance there, and their life insurance over there—what if insurers offer them a bundle?
As they undergo a digital transformation, what are the main considerations FSI organizations should keep in mind?
Perfection is the enemy of the good. There are many digital transformations to consider. Waiting to get the perfect intersection of each is impossible. Instead, FSI organizations should focus on small progress, analyze what’s working, and gain a lens on their customers from their product specialists and salespeople. Deciphering the best methodologies for each organization takes time.
How does siloed information hinder business transformation?
As a lot of organizations have grown organically, their sales leaders and engineering teams often have grown in silos. The definition of a customer may be different between a consumer-lending team versus an investment-management team. FSI organizations need to understand that their customer is the same person regardless of which team is serving them. Connecting those dots is much harder than people think.
Why else do you think digital transformation is difficult for FSI organizations?
Investment dollars are precious. Digital transformation is one journey that FSI organizations need to make, but they also need to continue to evolve their product stack and their customer service. They must weigh their transformation investment against new innovations, products, and partnerships.
According to a new Workday survey, 62% of FSI executives say “the pace of digital transformation has either slowed down from where it was a year ago,” or they expect it to slow down in the future. Why do you think that is, and how would you advise them?
The new way we work probably plays a role in the reported decrease in digital transformation. What workers accomplish together is different in an in-person environment versus a remote environment. Companies are trying to determine how to be productive in group settings while being remote. The economic environment, with the changes in interest rates, will also inform how we invest our dollars.