Accelerating growth in technology is reshaping every industry. Owing to this digital disruption, competition is also accelerating. Digital transformation is crucial for Credit Unions.
Digital disruption is member disruption. In the face of this rapidly changing landscape, what is the role of a CEO? In this article, we have shared insights on digital transformation, as shared by Joe Mirachi, CEO, Launch Credit Union, at the 6th Annual CULytics Virtual Summit. He shares a framework that credit unions can use in their digital transformation journey.
As a CEO, it is important to determine how to respond to these changes, and embrace digital disruption by aligning internal digital transformation of the Credit Union. Here is how to start -
For Credit Unions, strategy is changing the organization to respond to a changing environment in order to better serve members.Three key components of the strategy are, business model, target market, and a unique value proposition. The question you need to ask in order to align your strategy is , “ How does technology change your business model?” Does it change your business model? How can you use it to improvise your business model and better serve your members?
Here are some driving strategies -
- Omnichannel Strategy - Omnichannel is a member-driven strategy, how they interact with us needs to be frictionless. It needs to drive your digital transformation plans. The switch from one channel to another should be connected and seamless.
- Ecosystem driver platform strategy - This model leverages digital capabilities. The emphasis of this business model is based on access to the member via the digital channel. For example- besides the key products, it can be beneficial to include relevant products in an efficient and personalized manner, which can result in additional revenue and provide one-stop shopping convenience to members.
2. Technology - Investments in technology are expensive, long-term, and most often cannot be redone. You should remember that technology is a tool and you should pick the best one.
- API Infrastructure - API infrastructure is an open system that helps you plug in various other systems in a highly integrated manner so that they can work well as one single system. It opens doors to innovation and can seamlessly help integrate member experience. It can support both omnichannel and platform strategy. It is flexible, scalable, and improves the ability to innovate quickly. API Is a technology that enables digital transformation. With this technology, everchanging member expectations can be matched with innovative solutions. For Launch Credit Union - Core system, digital banking, and debit/credit cards were the technology trifecta which formed the part of the API structure.
When you acquire a new tool, you need to change how you interact with the tool. This step is where you can convert the benefit of technology to tangible benefits.
New skills are needed for digital transformation and this directly impacts our organization. Digital transformation must be matched with the transformation of the skills of your people. For a CEO, the starting point is to get the right people(attitude, aptitude, skills) in the right place(organization structure/jobs). This is supported on a dynamic basis by the coaching matrix- the right people in the right place develop advocates and willing followers
Credit Unions need to become learning organizations- a collaborative group skilled at creating, acquiring, and transferring knowledge and insights. A learning organization is a key catalyst for a successful digital transformation
Digital transformation is a requirement and not an option. It is a journey, not a destination. Strategy added with technology and people equals results. This is the digital transformation framework.
Your digital transformation journey is driven by your strategy, enabled by your technology, accomplished by your people, and measured by your results. It is crucial to demonstrate continuous learning.
As said by Charles Darwin, “It is not the strongest of species that survives, nor the most intelligent, but the one most responsive to change.” In the face of change, your Credit Union needs to stay relevant and viable. One piece of advice is to have a seamless integration of technologies, and not have digital silos. Workflows must change and processes must be redesigned. Equally crucial is to change how your people interact with the new tools and to upskill. Today, Credit Unions need to be learning organizations - Embracing uncertainty and doubt, making data insight-based decisions and experiments are attributes of a learning organization.