27 Tech-Enabled Initiatives on the Table: Where do I Start?
Today there are more technology applications available to financial institutions than ever before. These applications are in every area imaginable; from loan origination, client relationship management, payments, APIs, core overlays, to fraud control, and more. With similar marketing language such Cloud Native, Holistic, and Digital First the challenge for financial institutions has become not a lack of options, but instead sorting through an over-abundance of choice, and choosing where to start.
If you and your leadership team have a crisp understanding of your goals, you’re in a good position to begin prioritizing technology initiatives.
Slow Down to Speed Up - Know Your Goals
When considering strategic initiatives, clearly articulating your institution’s goals is an important first step. Consider high-level goals such as:
- Does ownership want the institution to remain independent, merge or be an opportunistic buyer of other institutions?
- What financial metrics do we expect the institution to achieve and do the selected initiatives support those objectives?
- Do we want to grow our geographic target market, focus or expand in niche areas where we have expertise, or expand into other business lines to achieve these goals?
- Do we have obstacles to overcome before we can successfully implement new technology? (Staffing, regulatory, margin compression, or other challenges …)
- What is our time frame to reach these goals and how much money and people-power are we willing to commit?
The time you spend upfront exploring and defining, or reaffirming, your institution’s goals will be gained back in the long run as you’re able to execute your plan more efficiently and directly.[i]
Keep the End in Mind
Whether your customer is a small- or mid-sized company or a single family, they have a goal in mind when they come to you — and they want you to help them achieve them. The same is true for your institution.
With your goals clearly stated, question how each of the identified initiatives will help your institution achieve them. Consider items such as:
- How will this improve our end-users’ experiences?
- What is the expected return on the project and over what period of time?
- Which short-term/long-term goal(s) are aligned with this initiative?
- Will this project create multiple value streams?
- What is the opportunity cost?
- What will we measure and how will we define success (on budget, on time, and with the expected results)?
- What additional resources will be needed if the initiative exceeds expectations?
- At what point should we terminate the project if it’s not achieving desired outcomes?
If you are considering several new initiatives at once, analyze and prioritize each one by potential return, amount of time required to reach that return, and total cost (both upfront and ongoing). Some technology initiatives bring a big return on investment but take longer to implement, whereas others might yield quicker results with less overall impact.
Build Upon a Solid Foundation
In order to achieve success, your chosen technology additions must be built upon a solid foundation. Before proceeding, consider the following foundational items:
- Does our technology staff understand the strategic objectives? Do they have the experience necessary to ensure your investment achieves the results you’re seeking?
- What project management time will be required for implementation and maintenance of the selected applications in the future? Does our team have this capacity available?
- Have we considered all the infrastructure requirements that we’ll need related to hosting and data communications?
- What security, regulatory, and internal control tests are in place to reduce risk?
- Can we gain insights from other institutions that have chosen the same technology applications? [ii]
Technology has an expanding role in helping you achieve your goals, and the answer to prioritization starts with a clearly defined strategy, a solid foundation, and a consistent approach to evaluating options.
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