De-Risking Digital Transformation
- 1. De-Risking Digital Transformation Three Keys to Success in Financial Services December 19, 2019
- 2. Introduction
- 3. Crownpeak provides the market’s only enterprise-grade cloud-native CMS and Digital Experience platform Ian leads Crownpeak’smarketing and communications department where he is responsible for generating demand and growing awareness for the world’s only enterprise-grade SaaS CMS. With over 20 years of marketing and technology experience, he focuses on content management, marketing technology, and customer experience. Ian Lowe, VP Marketing at Crownpeak 3
- 4. VShift creates digital products, strategies and technologies that drive growth and accelerate transformation Eric Feige, Managing Director Strategy Eric has been in digital transformation for over two decades, delivering innovative technology and digital experiences to firms such as Prudential Financial,J.P. Morgan, Deloitte, and KPMG. He has also led digital native businesses like his VC-backed cloud venture and VShift – a leading digital consulting firm. Eric is a board member and business advisor to several New York-basedstart-ups. 4
- 5. Digital Transformation in Financial Services
- 6. Transformation: A complete change (metamorphosis) in someone or something (like an organization) Digital transformation is the strategic, sequenced use of digital technologies and capabilities to create new — or modify existing — business processes, products, culture, and customer experiences to meet changing business and market requirements. This reimagining and realizing of business in the digital age is digital transformation. Phase 1 Phase 2 Phase 3 Phase 4 Phase 5 6
- 7. Financial services and insurance companies frequently trail firms in other sectors (like technology) Government Asset Mgt. Insurance Banking Media/ Entertainment Telecom Retail Travel/ Hospitality Digital Leaders tech businesses offering financial services are often digital leaders Incumbent financial services businesses historically rank below average in digital maturity 7 Digitally Mature Digitally Immature
- 8. Financial services firms have inflexible “structures” in place that make transformation very difficult A Intermediated & Relationship Focus Direct CX Engagement & Focus B AUM Model ($ making $) Client Acquisition Dependent C IT Resource Dependency Product Management Freedom D Hierarchy, Slow Decision-Making Flatter Orgs, Faster Decisions/Actions E Unaligned Goals & Disincentives Aligned Goals & Incentives Incumbent financial services factors compared to digital leader factors 8
- 9. Digital transformation failure rates are noted as 70 to 85% Critical issues: ▪ Lack of executive sponsorship ▪ Organizational confusion ▪ Underestimated scope (not broken down) ▪ Miscalculated risk (not isolated) ▪ Making the wrong bets Phase 1 Phase 2 Phase 3 Phase 4 Phase 5
- 10. Let’s drill down from the macro issues to three keys for success and de-risking transformation 10 Governance Decoupled Technology Culture
- 12. 1. CCO or CMO executive committee sponsors most often drive successful digital transformations. IT leaders or Operations leaders have less transformation success they do not “own” the commercial relationship between the business/brand and its clients. 2. Effective governance requires cross functional support. Teams may ignore the “northstar”, but they align more effectively on a vision and objectives “constellation of stars” that will crystalize over time. 3. Stakeholders are always being educated and engaged – phase to phase. Governance: How we decide how things (e.g. prioritization, funding, methods, resourcing) are to be done 12
- 13. Example of putting digital transformation governance structure into practice EXECUTIVE SPONSOR CCO STAKEHOLDERADVISORY Representatives from Product Strategy, Sales, CustomerCare, Operations,IT & Legal/Compliance PROGRAM MANAGER Head of Digital STRATEGY BUSINESS ANALYSIS CONTENT DIGITAL TECHNOLOGY CHANGE MANAGEMENTUX & DESIGN LEGAL & COMPLIANCE PROGRAM OWNER CMO STAKEHOLDERADVISORY RESPONSIBILITIES Advise owner and teams on the needs of the business;Identifystakeholders in their functional group as needed forparticipation in projects;Review suitability of proposed solutions and provide feedback;Resolve issues,roadblocks in their functional group; Assistin change managementcommunications through vocal and behavioral supportof the vision, objectives and roadmap. SALES & SUPPORT This group crosses silos, is aligned to common principles and objectives, and resolves issues. 13
- 14. Example of putting digital transformation governance structure into practice EXECUTIVE SPONSOR CCO STAKEHOLDERADVISORY Representatives from ProductStrategy, Sales, CustomerCare, Operations, IT & Legal/Compliance PROGRAM MANAGER Head of Digital STRATEGY BUSINESS ANALYSIS CONTENT DIGITAL TECHNOLOGY CHANGE MANAGEMENT UX & DESIGN LEGAL & COMPLIANCE PROGRAM OWNER CMO STAKEHOLDERADVISORY RESPONSIBILITIES Advise owner and teams on the needs of the business;Identifystakeholders in their functional group as needed forparticipation in projects;Review suitability of proposed solutions and provide feedback;Resolve issues,roadblocks in their functional group; Assistin change managementcommunications through vocal and behavioral supportof the vision, objectives and roadmap. SALES & SUPPORT This group crosses silos, is aligned to common principles and objectives, and resolves issues. 14
- 16. 16 Legacy IT processes and traditional technology architectures are dangerous obstacles that can sink the transformation ship. Monoliths and inflexibility are the big “bergs” to watch out for. Why most orgs have a profound challenge with digital transformation What’s visible The CIO’s legacy IT “Mountain” Ageing legacy systems (ERP, etc) Bureaucracy + overcentralization Years of underinvestment Traditional datacenter Technicaldebt Cost center focus Legacy skills Closed platforms / no APIs The real challenge
- 17. 17 Dependency on enterprise architecture decisions make in a different tech era User Interface Business Logic Content & Media Data Storage Users & Identity Hosting & Content Delivery Search (More ...) Traditional, monolithic software used in legacy IT are restrictive, force unnecessary compromises and create vendor lock-in to a prescribed vendor depended “strategy” Too much program risk (time-to-market) by leaning on “COTS” monoliths Traditional Approach
- 18. The decoupled, component-based model supporting critical business needs that support phasing and much faster time-to-market Content API Content Targeting Multimedia (Video) 3rd Party Data APIs Client Data APIs Industry Sources Tag Management Digital Analytics Account Based Marketing Social APIs Domain Service Authentication Access Marketing Auto Email Online Events CRM Digital MarketingDigital / CX Analytics User AccessData ServicesContent & Search Customer Satisfaction Onsite Search Effective transformers use governance forums to understand a bigger picture while helping with practical prioritization (shown in purple vs blue) Emerging Tech AI DLT 18
- 19. 19 User Interface Business Logic Modern, lightweight decoupled web architecture Content & Search Data Services Digital Analytics & CX Services Digital Marketing User Access Personalization and AI We de-risk transformation significantly by addressing high-risk interdependencies and integrating the best-fit tools quickly (weeks not years)
- 20. Culture
- 21. Most high-impact variable positively and negatively impacting digital transformations is culture E.g., Market Share, Revenue Growth, Innovative Positioning, New Markets, New Products, Client Obsessive Culture E.g., Awareness, Understanding, Selection, Brand Advocacy, Retention, Referrals Our Goals Customer Behaviors Product Experience Technology, Resourcing, Process E.g., Easy to find, easy to understand, complete, easy to transact, useful, valuable, resilient, secure E.g., Functionality, flexibility, easy to innovate, supported, integration, best-fit When culture goals and metrics are formalized, transformations have a good chance of success 21
- 22. Make culture visible focus area and measure progress Role model behaviors such as ownership, empowerment, client centricity, cross- functional collaboration and digital literacy Companies that have no plans or actions to change organizational culture are wasting resources on digital transformation 22 Assign culture goals to the organization – starting at the top Reduce dependency on partners whose values are not aligned Measure, test and improve culture iteratively – phase by phase 1 2 3 4
- 23. Mobilizing: beacon projects address culture activities in all phases of digital transformation 1. Scope “quick wins” as a 100-day (MOL) beacon product launch 2. Apply well accepted guiding principles 3. Ensure professionaldevelopment in product management, CX and digital occurs throughout the beacon project 4. Quantify behavior changes and impact to goals 5. Engage stakeholders and provide recurring communications 23
- 24. Questions?
- 25. Thank you.