Many banks are currently facing the challenge of digitizing processes and services - with limited resources and strict regulations. We explain how the digitalization of banks can succeed despite all the obstacles and what is important in the process. Andreas Werner-Scheer and Nico Pantelmann, who have published an article on the topic in the second volume of the Enterprise Transformation Cycle (ETC).
Note from the TCI editorial team: Read also part 1 of the interview - Transformation in the banking sector - IT is becoming increasingly important for banks
"Banks can only hold their own against FinTechs through digitalization"
Beate Greisel (BGR): What is your assessment: at what point is the digitalization of banks in Germany?
Nico Pantelmann (NPA): In the Digitization of banks has great potential. Unfortunately, regulation often stands in the banks' way. In my view, there is a risk of over-regulation in Germany in particular, which leads to missed opportunities.
Andreas Werner-Scheer (AWS): Almost all banks worldwide have now recognized that the only way to win the competition against FinTechs and BigTechs is to massively expand digitalization. Unfortunately, banks are struggling to provide the necessary budgets, which are heavily tied up in regulatory issues, and legacy systems make it difficult to implement the necessary architectural changes.
BGR: What role does IT governance play with regard to optimization potential in banks - in theory and in practice?
AWS: IT governance is a necessary prerequisite for channelling increasingly scarce resources into the right digitalization projects. It provides the necessary transparency and control impetus.
NPA: With functioning governance, the balancing act between what is possible and what is "allowed" can be managed and controlled.
Quick start, quick success: how to digitize banks successfully
BGR: What are typical sources of error in the application of such processes (and in realizing the potential)?
AWS: A typical mistake is to try to improve too many processes at the same time. Most IT organizations cannot cope with this. It is more promising to start with the most important processes and make successes tangible quickly.
The second mistake is a lack of accountability. Every process needs a process owner whose success is also measured by the improvement of the process.
The third mistake is an overly ambitious approach. A bank, for example, does not need a maturity level of 5 in the area of IT quality management. A software manufacturer does. Appropriate targets must therefore be defined for the respective company.
NPA: In addition, I would say that a company must also be culturally positioned in such a way that it can admit to using a process with a low level of maturity and that nobody is attacked or feels attacked when this low level of maturity is identified.
BGR: How can the Enterprise Transformation Cycle, or ETC for short, help to tackle these challenges and achieve sustainable improvements?
AWS: The ETC offers a tried-and-tested procedure for achieving sustainable positive change in a continuous improvement cycle involving all stakeholders and dimensions of consideration.
BGR: Mr. Pantelmann, Mr. Werner-Scheer, thank you very much for this interesting interview.
The interview with Nico Pantelmann and Andreas Werner-Scheer was conducted by Beate Greisel for the TCI editorial team.
Read also part 1 of the interview Transformation in the banking sector - IT is becoming increasingly important for banks.
"Mastering transformation projects with the Enterprise Transformation Cycle" - published August 2020
The Transformation Consulting International has been supporting national and international transformation projects in companies for many years. Based on this extensive wealth of experience in practical implementation, the second volume, entitled "Mastering transformation projects with the Enterprise Transformation Cycle: successfully planning, implementing and completing projects" published by the renowned Springer-Verlag. As a continuation of the first volume, this one takes into account further wishes and suggestions from readers and presents concrete transformation projects and action situations of TCI experts in their daily application of the ETC. The editors of this 500-page volume are Mario A. Pfannstiel and Peter F.-J. Steinhoff. You will find numerous theoretical and conceptual contributions as well as practical case studies on the "Enterprise Transformation Cycle".
(Cover image: © AndSus | Adobe Stock)
