Imagine this scenario: A bank executive meets with an innovative and forward-thinking tech leader and is immediately taken in by their offering. They think it would make a lot of sense for their bank, and ask the tech leader to meet with the team who are similarly impressed. They do their due diligence, and find that all of the tech company’s customers give them glowing reviews.
They move forward, and after some time and effort the product launches. Everyone is excited… except the product falls completely flat, and ends up doing nothing to help the bank do business better. So what happened?
Strategy Before Structure
Unfortunately, too many banks work with those vendors without first considering whether their products actually fit into the larger strategy of their bank first. Instead, they do the opposite, and end up molding their strategy around the technology vendor they end up working with.
In these situations, the principle of strategy before structure is really important. When thinking about the actions you and your bank are taking, are they defined by your strategy? Or is your strategy being driven by your vendors. It should be the former.
One example that comes to mind is banks that invest a lot of time and money into online lending or account opening applications, only to be disappointed when they are met with mostly with fraud and spam. Often this is because they never built out an online marketing strategy for the software to support. Conversely, we have seen banks have tremendous results through the same channels — when it was part of a deliberate strategy to go online.
Building a Strategy
If the above scenario hits a little too close to home, that’s ok, you are not alone. But in order to keep it from happening again, there’s a few things to keep in mind moving forward:
Understand what is out there. As a banking leader, it’s important to understand what is available when it comes to new technology. You should be speaking with and engaging with tech leaders to understand what is possible.You should also be speaking to other banks, and finding out what they are doing. Find a banker in a different state or market where you don’t compete and ask them what tech stack they are using, both successfully and maybe not so much.
From there, take the information you have gathered and go back to your drawing board. Think about your strategy, and be empowered to use what you now know is possible to advance it.
Work with transparency. When working with vendors, it’s common for banks to be secretive about their evaluation process and which vendors they are considering. In my opinion, this is the wrong way to go about it. Working with vendors should resemble WWF’s Royal Rumble — everyone is standing in the same ring, and the last person standing wins.
It’s the best way to ensure complete transparency and get you the clarity you need to make a decision. It also allows vendors to work together and balance off each other, rather than tying one hand behind their back and asking them to design a system without knowing all the pieces in play. We have seen scenarios where two seemingly competing vendors can actually come together to form a better total solution.
In my opinion, it’s also the best way to cut through the noise and see who really understands you, your bank, and your strategy the best. Ask the vendors to explain the differences between them and the other organizations you are reviewing and compare notes.
Run a pilot program. Where possible, any time you implement a new tech product in your bank, you should implement it first as a mini or pilot program.
Find a division in your bank, or maybe even just a single banker, and let them try out the product first. If that’s not possible, ask the vendor if they can set up a sample instance or use dummy data in a workshop before going live.
These kinds of tests allow you to agree on the success criteria (and see if the vendor can meet them) before spending the time and energy to go live on a large scale. And any vendor worth working with should have no problem offering such an option.
When you work with DocFox, we keep each of these tips in mind. We are often called on to help banks think through their technology strategy even outside of our product. At the end of the day, its in our interest to make sure you succeed and make the right decision including if that is to use another business.
In an effort to make it even easier for commercial banks to give us a try, we recently launched DocFox Accelerated, which can be live in 48 hours, allowing you to test our products and see how they fit into your larger goals.
Want to know more? Reach out to a member of our team today!
CEO & Co-Founder at DocFox