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Banking Reimagined

by internationalbanker

Satya Ramaswamy - TCSBy Satya Ramaswamy, Vice President & Global Head of TCS Digital Enterprise, Tata Consultancy Services



Financial services, like any other industry, are feeling the effects of the Digital Consumer Economy. This is a new era, which will see digital technology revolutionise the way in which enterprises understand, anticipate and engage with their customers. We have now moved beyond the Internet Economy that introduced the world to a new level connectivity and consumer empowerment with a wealth of information at their fingertips. 

As the world moves forward into the digital era, banks will thrive, or fail, based on their ability to effectively harness the technologies driving this change. Success will require the complete reimagination of everyday transactions and processes by capitalising on the benefits this new era will bring. 

Many banks have already acknowledged the importance of digital. According to a recent report from Tata Consultancy Services’ (TCS) The Road to Reimagination: The State and High Stakes of Digital Initiatives, ninety-five percent of companies now recognise digital technologies as a critical way to connect with their customers. A further seventy percent stated that digital initiatives were either the most important factor or of major importance to the success of their organisation. In short, businesses have realised that, in the Digital Consumer Economy, the default is digital. 

The report looked into the traits of those organisations that are leading the way and those who will initially fall behind and eventually follow. 

TCS defines three categories that make up the timeline towards digital maturity. These are known as digitisation, digital transformation and digital reimagination

Digitisation covers initiatives which take a physical business process and make it digital. In simple terms this could be defined as the movement away from pen and paper to a tablet, or adding a mobile-based process to a desktop-based business process. 

Digital transformation adds a degree of sophistication and typically involves transforming a company’s channels to its customers. An example of this could be providing customers with the ability to purchase or manage their relationship with the organisation through mobile devices or social media. 

The third category, and the pinnacle of the three approaches to digital, is what we call ‘Digital Reimagination’. 

Digital Reimagination initiatives leverage a combination of digital technologies – what we refer to as the Digital Five Forces – to completely reimagine an enterprise along six dimensions; business models, products and services, customer segments, channels, business processes and workplaces. Here we use the term ‘reimagine’ to denote the creation of things that are fundamentally new and not just incrementally better. While Digitisation and Digital transformation are incremental innovations to existing process, Digital Reimagination is truly a disruptive innovation that has the power to fundamentally change companies and even entire industries. 

Cloud computing and mobility conceptSo what are these five digital forces? We categorise them as the following: 

Mobility and pervasive computing, enabled by smartphones and tablets, has transformed customer services into anytime, anywhere contextual interactions. Mobility has also liberated information technology from the desktop, enabling an empowered field force. 

Big data, by allowing businesses to process massive amounts of data at high velocity, and in formats that may not fit the fixed schema of structured data, can deliver genuine business insights that otherwise may have been entirely lost.

Social media means that for the first time in human history businesses can listen to the unfettered sentiments of millions of consumers.

Cloud has enabled highly scalable, fault tolerant computing capability that is democratised and cost effective.

Finally, modern developments in artificial intelligence and robotics are creating a highly scalable automation of human intellect and physical dexterity that promises to genuine transform the way corporations make decisions and act upon them on a day-to-day basis

True digital leaders are those who are leveraging all five of these forces in combination, while those businesses that are not truly embracing digital typically tend to focus only on one or two in isolation. 

An example of this in the banking sector; currently financial advisors provide mostly-generic and un-personalised advice, which rarely factors in research reports. Often they have a one-size fits all method which takes time to become tailored to the customer’s needs. 

Using the Five Digital Forces, banking and financial services organisations can provide artificial intelligence (AI) based textual mining to pick appropriate research reports; sentiment analysis on trade data in social media; and customer insights and real-time information on mobile devices to enable appropriate investment advice. 

The effects of this change will not only be seen in the banking and financial services sector. Every industry, from utilities and retail to manufacturing and media, will need to be reimagined if it is to take into account the rich possibilities that digital technologies can enable. This process has already begun. The challenge for today’s banks is to make sure they are at the forefront of this transition so that they can reap the rewards. 

‘Digital by default’ will without doubt be the basis for successful companies in the future, digitisation and digital transformation will not be enough to succeed. The change is already happening, and banks must act quickly if they are to flourish in this exciting new era.



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