SFF 2020: Digital and Cultural Transformation in a Co-COVID World

image of singapore fintech festival

Resilience Series: During the Singapore Fintech Festival, CFTE covered sessions related to the themes of Resilience, Agility, Innovation and Culture Changes. Topics covered  in the new Intrapreneurship course, launched recently. 

In this panel discussion on the finance industry in a co-COVID world, Matthias Kroener, Nigel Verdon, Sheel Mohnot and Dr Leda Glyptis shared how the industry is coping with the challenging new environment and changes that need to be made to ensure its survival.

If you would like to know more on how CFTE is working with organisations around the world to engage their employees in digital transformation, reach out to us here.

SFF 2020: Digital and Cultural Transformation in a Co-COVID World

During the festival, we had the privilege of listening to some of the industry experts in banking and FinTech share their views on the transformation of banks and institutions, both digitally and culturally, and what more needs to be done for the industry to progress. Joining the discussion were founder and former CEO of Fidor Bank, Matthias Kroener; Co-founder and CEO of Railsbank, Nigel Verdon; Chief Client Officer of 10X Future Technologies, Dr Leda Glyptis; and Founder of Better Tomorrow Ventures, Sheel Mohnot.

Tuning in to a COVID world

When asked about how financial service providers are currently responding to COVID in support of societal needs, Dr Leda shared that in the short term, they are doing relatively well in dealing with the challenges of equipping their colleagues and teams with the necessary capabilities to function. To help users better cope with difficult financial situations, institutions have also created payment holidays and other practical solutions. However, Dr Leda criticises how bold moves have not yet been taken to make significant changes in digitisation. In recent years, digitisation efforts have been too cautious, impeding progress and hence the gaps of not having digitised capabilities have been surfacing, especially in a COVID world. The large reluctance to commit to a full-scale digitisation effort has an inevitable role to play in the difficulties coping with the current challenges.

Nigel, Matthias and Sheel also have a common consensus on digitisation being a key component of managing future challenges, and we are still a long way from reaching the end goal. Incumbent organisations need to start making progress to inspire a future norm radically different from traditional methods. Digitisation not only comprises technology, but a holistic transformation of corporate culture, target operating models, data management and innovation, as accurately emphasised by Matthias Kroener.

Thriving in a Crisis

Nigel Verdon is a strong advocate for banking to be accessible to the vast population, that it should be a human right instead of a privilege. Hence, this brings about the need for changes to be made in the core structure of the banking industry through new methods and technologies. Nigel parallels the deconstruction of the banking industry to other industries such as music, where Apple deconstructed the conventional music album to individual digital tracks that could be purchased on its own. Consumers could easily afford these singles that were available everywhere, and the purchase of such tracks could be customised based on their specific needs. Such revolutionary deconstruction and reconstruction needs to be introduced to the financial services industry, where their services are broken down to its core components to create an environment that can better suit the needs of their consumers. The fundamental value needs to be transitioned from being institution-centric to more consumer-centric.

To better understand the needs of people, Matthias Kroener suggests that institutions need to take a closer look to identify major trends within society, and make use of those to form foundational cornerstones upon which they can transform their services. For instance, the increasing use of mobile services, e-commerce and interaction on social media platforms can give service providers a good understanding of user trends, to allow them to focus their work based on consumer behaviour. Dr Leda also brought up an excellent point on how banks are no longer in control of timings, such as when a pandemic will hit or when digitisation will affect the life around us, hence they need to be prepared for such situations and cannot remain complacent. Another issue brought up was that banks should no longer use regulators as an excuse for the lack of innovation and progress from legacy banking, since regulators now have a much better understanding of the potential value that digitisation can bring for consumers and will no longer cover for their lack of action.

Cultural Transition from Legacy Systems

Through the experience of how a pandemic can cause such a catastrophic impact on the industry, we now understand the urgent need of cultural and digital transformation. There is no doubt that such a transition is extremely long term in nature and will not happen over a few years or even a decade. Hence, companies and institutions need to start the change as soon as possible. Matthias emphasises how such changes reach deep into the core of the organisation, whilst  firms need to be fully driven by the CEO, shareholders and major stakeholders for there to be an effective change. The few people that are against digitisation will pounce on any failure of technology to revert to traditional methods, hence the drive for change must be strong to overcome such negative influences. The COVID pandemic has taken a toll on companies’ budget for customer experience, and the focus is more on compliance and risk management. Companies need to overcome the fear of getting into trouble, and see the value in taking risks and moving towards digitisation for the long run. Adding on to Matthias’ points, Dr Leda urges companies to step out of their comfort zone and stop hiding behind compliance, as an excuse to stick to legacy methods. A balance between the opportunity cost of not having any transformation and the possible risk of using technology is key for banks to achieve success in the upcoming years.

Sheel Mohnot shares that even in the FinTech industry, companies are going after compliance at much earlier stages, and it is getting more common to see Chief Compliance Officers around. Companies need to shift their focus away from risk management and understand the value-added by taking risks with digital transformation. Nigel Verdon focuses on the necessity for risks to be taken for successes to be achieved, just like in any other area such as trading. Compliance should not be an excuse not to do something, but a guide for rules to be followed. Ultimately, the DNA of the organisation and the industry needs to be fundamentally changed for transformation to truly happen.

If you would like to know more on how CFTE is working with organisations around the world to engage their employees in digital transformation, reach out to us here.

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