In finance, digital transformation (DT) is a notion that has evolved beyond technology to become an integral aspect of a successful company strategy. The impact of digital transformation on corporate operations has been good. It has enabled speedier, more cost-effective operations, as well as fulfilling regulatory deadlines, improving employee and customer satisfaction, and remaining competitive. As a result, rather than being a technical plan, it has evolved into a business strategy.
Due to the widespread availability of business data, teams' ability to process large sets of data using now-accessible algorithms and analytic methods, and improvements in connectivity tools and platforms, such as sensors and cloud computing, digital transformation in finance is now a realistic goal.
Top Financial Services Digital Transformation Trends
Digital transformation is a must-have for any firm.
Across many industries, digital transformation is a business necessity, and financial services are no different. Almost all (97 percent) financial services companies are pursuing digital transformation in some way, whether they're still creating a plan or have already implemented one. Developing a digital transformation strategy is the top digital priority for more than a fifth (21%) of respondents.
Who is the person who is to blame? The financial services landscape is rapidly evolving. Take, for example, one of the sub-sectors: banking. While many basic banking services (such as safekeeping, payments, loans, and investments) haven't changed much in the last century, how banks manage these operations and transactions—and how clients expect to receive them—has.
Digital transformation has a demonstrated — and much-anticipated — return on investment.
The advantages of digital transformation are obvious, such as increased customer experience and operational efficiency. As a result, most financial services companies—even more than those in other industries—expect substantial returns on sales and profitability from digital transformation. Lower middle-market companies, in particular, expect the highest gain in revenue and profitability (10% or more) over the next three years, and are thus willing to raise spending by the same percentage.
Long- and short-term business goals for financial services include improving client experience and operational efficiency
1. Enhancing the Customer Experience:
Customer service is only one aspect of the customer experience. Customer experience refers to a customer's overall journey from start to finish, including every touchpoint and interaction along the way. While the latter is usually reactive (and only one component of the former), customer experience refers to a customer's overall journey from start to finish, including every touchpoint and interaction along the way.
This is fast-changing. A good "client experience" may have meant having a nice experience at a physical bank or other financial services organization a few decades ago. It may mean anything these days, from being able to access an account through various channels to having a question answered instantly by a chatbot or Robo adviser to receiving automated real-time notifications.
2. Increasing Operational Effectiveness:
All businesses strive to save money, but financial services organizations are particularly under pressure to do so. The top digital priority for financial services firms is to improve business efficiencies and operations across the supply chain (cited by 37 percent). Reduced operational inefficiency is also one of the top three long-term goals for 82% of respondents, and one of the top three short-term goals for 76%.