Digital Maturity Model for Banks' Digital Transformation

As I noted in my last post, Banks should define their roadmap for Digital Transformation, But it is mandatory to have in hand the definitive Digital Maturity Model, something like the well-known CMMI for the Software Industry. This model should provide levels of maturity for Banks. I´ve been amazed to see a lot of banks struggling with their own models. Consultants imposing their models, models built on the GO.

Since the Banking industry, just try searching the web for this term and easily there will be more than 250K results, none of them is a clear standard, none of them comes from a common source. So, as we are in such a state of multiple efforts to have a good model, the only way out is to evaluate the success possibilities around and take one. Any other suggestions? Yes, right, the best path eventually be not the best one. We fail in the dilemma of choosing the best based on the nearest truth. This means, that after benchmarking the market that affects the bank, something will come up and that will be the ideal model. Sad but true, as Metallica´s song says??. Not at all, the truth is that the banking industry is big, the threats vary from place to place, and it is not practical to compare one bank in New York to another one in Sri Lanka. Different realities? yes. In the end, there are different approaches, full of good intentions. This means that the bank across the street will implement a different model than its neighbor.  boooo, scary!

It is scary just if you think that Bank 1 considers that the level of digitalization for, let´s say its front office is roughly 80% and the Bank 2 assumes that for them the same level is 70%, but wait, The Bank A has 40 applications and Bank 2 has 110 applications. Sorry for Bank 2, now is paying for having a lot more in applications than its rival.

Now, the point here shows how important is to adopt the right Maturity Model and be prepared to understand where is located the bank in question. Something like the problem of two-speed runners, the first one like Bolt, tall, slender, etc, the second one will be a small man from X country who runs 100 m just 0.2 seconds behind Bolt. It is clear that regardless of the runner´s height and other physical factors, the winner is the one who scores less time for the same distance.

A common approach to measure the maturity index is to consider

1. Front Office
2. Middle Office
3. Back Office

and determine the percentage of Medium, Basic and Advanced degree of digitalization in everyone.  As far as now, the Front Office in all banks has more chances to improve its digital face, nevertheless, all 3 have an impact on Customer Experience and are affected by Service Design. Again, the Maturity Model comes to show that it is important to measure Digital Maturity as a whole. What an intersting point,  isn´t it?

Keep in mind to have KPIs and adopt a standardized model.

Most solutions fall in Customer Service digitalization, but the real Digital Transformation is a whole.   Hence, the maturity model should encompass internal and external actors affected by systems and operations.

Back in 2011, the vision of the branch of the future defined a revolutionary approach in customer service at the branch level, it depicted integrated channels for service, Mobile as the biggest container, then inside these web applications that covered call center and the call center keeping inside the traditional Branch and the philosophy behind the concept is to have a continuous process of performance improvement. The missing concept behind this proposal was the model itself, there are thousands of banks, each one living a particular reality, that is why we need a common framework, no less no more.