What lies at the core of digital transformation? It’s clearly the customer expectations. Today the customers expect everything to happen seamlessly; in real time. Customers expect that as a bank or as the brand, one must know and understand them in and out. To do that, organisations need to leverage the data they collect. Customers leave a lot of information. It depends on organisations how they mine the data to make informed decisions and ascertain customer’s choices and make their lives simpler. These paradigmatic changes are now becoming the core of business that is forward looking and aiming growth. Unless one keeps customer experience at the core of business, one will have a challenge staying relevant. To do or not to do is not a choice anymore. If one has to stay relevant, one has no choice but to take this path.
Secondly, the customers are not as tolerant and forgiving as they were a few years ago. While customer acquisition cost has climbed down, customer retention and engagement are bigger challenges. Unlike past, customers have many options today. They can easily exit any network, system or platform if their demands are not fulfilled instantaneously. The modern customer expects the best-in-class experience. Whether it is about shopping, entertainment or dining, experience is all that counts. They expect similar experience from banks as well. That doesn’t hold true for any service-oriented industry today. Most importantly, one of the reasons why these things are changing is because cost, revenue and efficiency depend on the constant drive to keep creating value.
Digitizing for the Sake of It is a Bad Idea
Disparate digital initiatives undertaken or activities done just for the sake of doing it neither create a meaningful impact nor are sustainable. The core of digital transformation lies in the philosophy that a firm carries. Initiatives can change, but the core philosophy central to firms never do.
Excerpts from the Chapter by Deepak Sharma, Chief Digital Officer, Kotak Mahindra Bank in the Book Titled “Accelerating Enterprise Innovations”
A piecemeal approach is destined to doom. You need to pick up a set of initiatives that are in continuation. Within those initiatives, you have to prioritize, which is why digital transformation is called a journey – the goal post is always moving. You accomplish one priority and then move to another, says Deepak Sharma, Chief Digital Officer, Kotak Mahindra Bank.
This is precisely how we work at Kotak Mahindra Bank. The core philosophy here is to try and do things, which deliver sure-shot outcomes. We look at how technology can help us acquire customers digitally, engage with them, grow the portfolio and measure customer satisfaction on various parameters of success. That’s not the philosophy only for a digital transformation project but for the entire organisation’s value chain. No matter at what touchpoint you are – be it a bank branch, operations, contact center, finance or legal, the focus has to be on how your action can create meaningful impact for the customers. This helps align people to the core philosophy. This is where the culture and mindset transformation kicks in.
In order to successfully embark on the path of digital transformation, one needs to zero down on both initiatives and outcomes. We have to first identify the initiatives and then assess their impact. Ideally, they should either solve existing problems or create new business opportunities. Assess the initiatives on parameters like efficiency, cost, turnaround time and other similar measurable impacts.
The third important aspect is communicating the outcomes to the consumers, employees and key stakeholders internally. This builds confidence that the cultural shifts and disruptive initiatives are leading to the right outcomes, that are measurable and visible. If we get these three things right, it becomes much easier to follow the vision. There would obviously be an underlying technology agenda, investment, design, etc., but once we get the core right, the engine can pick up steam. Sustainable transformation journeys for organisations need to create meaningful impact.
Excerpted from the Book Titled “Accelerating Enterprise Innovations”