The shift towards digitalization has impacted every business sector, but true change comes from within. This holds for financial institutions that are moving away from traditional methods and embracing an agile approach. By adopting agile development, these institutions can prioritize innovation and better meet customer needs. In addition, the agile methodology allows for flexibility and continuous improvement in how services are provided. For more information on how agile development benefits the banking industry, refer to this blog.
Agile: It’s Not Only for IT Anymore
To stay competitive, financial institutions must choose the same project management systems and data flows that software development organizations use.
“A key factor for digital transformation in banking is for these companies to adopt an agile methodology,” states Jennifer Borchardt, Director of Omnichannel Experience & Strategy at U.S. Bank. “This involves not only in software merchandise improvement, where the method is well-known but also during the whole team to deliver business goals quicker and great.”
Improving the standard in the Silicon Valley tech industry, agile development leads to the iterative manner of construction and testing outcomes rather than waiting until the finished project is presented. With clear focus, if problems occur or modifications are required anywhere along with the plan, they can be addressed quickly. And with more limited influence than having to fight and repair a complete product from origin to end. Unlike “waterfall” development presenting a final product before testing, agile principles enable organizations to follow a clear-cut, data-driven strategy and continuously test and discover. This system also helps in speeding time to business by providing a minimum viable product (MVP) that matches users’ requirements and can be changed quickly.
“Agility is the several powerful means of implementation for digital change,” states a report by McKinsey & Company. McKinsey tells that agile methodologies can improve product development activity and decision power by five times.
“Agile culture needs to be trained across the business and not be assigned to a particular “innovation company,” suggests Dennis Gala in CIO Magazine. “Actions such as hackathons, ideations, or immersive learning activities based on the teachings of the failing firm with a focus on cross-functional collaboration aid firms remain forward of the innovation curve.”
Agile methodologies in banking can follow more than just IT-relevant plans. Banks can profit from adopting agile methods on business-wide data, including client service, wealth administration, and purchasing.
Agile Banking in the Real World
Agile is still comparatively new to the world of business. Due to the commonality of in-house advanced rules, alliances and assets, and aging core principles, banks’ access to their data begins with complexities not covered by many of their new tech rivals. “As time goes on and legacy methods are substituted by new policies built-in more current languages, the possibility to try agile practices of software development start cracking up,” states James O’Neill, a superior analyst at Celent.
One case is BBVA Compass, which has pledged itself to agile methods. BVA currently produces 60 percent of its software, adopting agile. The bank has previously cut development time from two years under a waterfall model to six months or less.
A Customer-Driven Model
One key principle of agile methodology is that it concentrates on meeting clients’ requirements rather than only making products and back-end technologies. Enhancing consumer knowledge through every touchpoint is the number one preference.
“An agile banking provider is controlled with the consumer experience,” states Jeffry Pilcher in The Financial Brand. “The organization makes judgments first based on what’s most suitable for the client, then on what’s most suitable for the financial system.”
Acquiring nearly half of America’s households, with assets of more than $2.5 trillion and services global, JPMorgan Chase & Co. practiced agile methodologies in their business to digitally transform. They indicated serving clients, with the focused purpose: “To facilitate the delivery of highly personalized, real-time encounters that consumers frequently require.” The group highlighted critical areas in which consumers rely on Chase’s digital contributions throughout their everyday lives. Their four pillars of consumer activity are to give a better option, safety, ease of doing business, and personalization.
Banks hold a solid competitive choice when it comes to the bottom, opportunity, and personal level of the consumer data they hold. Harnessing strong analytics, agile allows the swift and resilient development of treatments that use such data. This system assists in engaging with and serving clients with more innovative results — at important times in customer journeys and life experiences. Continuously building and improving such customer-focused products will encourage banks to prove that they know their clients. Learn their requirements, and can recommend the most suitable offers at the best time.
Making the Jump to Agile
“In banking, the iterative method that is the hallmark of agile allows faster development of and change to digital banking programs in acknowledgment to consumer demand,” says industry advisors Marc Harrison and Isaac Sacolick.
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