"To become a digital-first organization empowering people towards financial independence."

Understand how your digital transformation will positively impact every aspect of the business. The term "digital" is synonymous with business, yet it encompasses the entire organization and is not only about technology.

The insights contained in this article were shared by Thomas Novak, Vice President, and Chief Digital Officer at Visions Federal Credit Union, during the 7th CULytics Virtual Summit. He discussed his engagement with a diverse range of stakeholders, and how he aligns with them, prioritizes their initiatives, and delivers value. Additionally, he addressed several of the lessons he had learned along the way - What would he do differently if he had to do it all over again, and what should other credit union presidents keep in mind when investing in digital? 

A. Digital-First Mindset

Define and share the purpose
Determine the driving force behind your efforts to begin a digital transformation initiative. How are we improving the lives of our members?

Priming the pump
Working with key stakeholders to understand the narrative behind the initiative.

The Digital Advisory Board
An employee-based group focused on tackling challenges they see every day.

Fintech Collaboration Framework
Determining how, when, and why the organization will partner with fintech companies.

The Payments Strategy Forum
Money movement is changing everywhere – how can your company keep up?

Digital Roadmap
Setting the course for the next three to five years on your transformation journey.

B. Defining Your Digital Transformation’s Purpose

The following points have a direct impact on the business as a whole:

Advocacy

How can we continue to help members beyond digital banking? Digital banking is a major touchpoint for member interaction, but how do we make it more human and meaningful?

Empathy

What are our members concerned about? Trust How do we bring peace of mind to the adoption of the digital space?

Trust

How do we bring peace of mind to adoption of the digital space?

Adjacent Innovation

Moving beyond traditional banking products, what products or services make sense?

Partnerships

Supercharge our digital transformation efforts that go beyond vendor/client relationships – i.e., embedded fintech.

Modular Banking

Is our business model evolving? What role does Banking-as-a-Service (BaaS) play in our strategy?

C. Co-create Your Future

Cross-Functional Teams Are Crucial

Your vision must be supported by a defined plan and an iterative approach. Two key components are:
A . Prioritization Method
B.  Member Feedback
This human element of business member feedback and a continual feedback loop is really crucial to this whole operation.

D. Digital Advisory Board

Managing Up to Executive Leadership

• The purpose of the group is to scan the market and review potential fintech partners, advising executive leadership on trends and opportunities.
•  Fintech partnerships cover identity verification (KYC/AML), digital education, and charitable giving. Not only does it make it easier to spot fraudulent activity and potential threats, but it also simplifies the digital account opening process for members.

E. Fintech Collaboration Framework

Leveraging BaaS and Embedded Fintech

Credit unions may achieve their goals considerably more quickly, more effectively, and with greater efficiency when they work with a partner who has complementary skills in the field of financial technology (fintech). Educating the organization about harnessing the power of fintech to move at speed and scale to deliver products and services that benefit members. Several examples are:

• Digital Appointment Booking
• Enterprise SMS
• Buy/Sell/Hold Bitcoin
• Decide on Build, Buy, or Partner

F. Payments Strategy Forum

Payments Are Intertwined with Financial Health

• RTP Network - Credit unions benefit from the RTP Network by connecting their members to more efficient payment options. Credit unions can use RTP as a platform to develop new, cutting-edge products and services.
• Researching Bitcoin as a form of Card Rewards-Credit and debit card reward schemes are increasingly using cryptocurrency, such as Bitcoin. These reward programs may be attractive to members who are inquisitive about cryptocurrencies but do not want to put their own money at risk by purchasing it.
• Overhauled retail and business card program focusing on cash back.

2022 Focus

Get the right people at the table to start discussing substantively. The challenges we notice from members, industry news, and the market as a whole, and start taking action.

• Retail and Commercial Wire Transfers (Domestic and International)
• BNPL
• SMB Services to support invoices, payroll, and more

G. Digital Roadmap

The digital road map comprises five key areas:

Digital End-to-End

We need to automate every step of the process, from the beginning to the conclusion, if we're going to truly digitally transform operations.

Personalized Banking

Personalized banking is essential. How can we make the digital banking and public website experience more intuitive, attentive, and responsive to members' needs as they walk through the digital experience?

Payments

Financial institutions that streamline and simplify money transfer processes really advocate for their financial well-being. It actually creates ties with members.

Marketing and Product 

Credit unions have a lot to offer the communities they serve, but if they're not campaigning and raising awareness, it's all for naught. Therefore, marketing and product must work in tandem to ensure they have the appropriate megaphone to get the word out.

Infrastructure

We need a solid foundation. You need a robust tech stack and the willingness to rip and replace. For the proper solution, you can construct on top of it or around it, but sometimes you need to rip and replace.

Operating Principles and Prioritization Matrix 

Growth, Member Empowerment, Employee Knowledge, Financial Impact, and Community Impact - These values are helping us develop and scale not only in terms of profitability but also in terms of our ability to support more members.

H. How Do We Achieve Results?

Cross-Functional Collaboration

Digital Strategy and Culture
Leveraging the roadmap, the leadership team aligns efforts. That's one's culture.

Member and Staff Engagement
Co-create future via ongoing collaboration amongst working groups to make life easier and achieve financial independence.

Process and Innovation
Creating an ecosystem of partners—fintech and modular banking— True innovation comes from a team working together, aligning resources, and putting people first.

Technology, data, and analytics
Co-create our future via ongoing collaboration amongst working groups. A decision-making process that includes both quantitative and qualitative data is critical to our success. Research and consideration of our members' best interests are at the heart of our decision-making process.

I. Tenets of Digital Transformation

An Engine for Change

Define your values and purpose

Having an open discussion about the direction the organization is heading in and why should be a top focus.

Make it a Top Priority

Some ideas may be wonderful, but they may not be right now. But keep an eye out. Prioritize them according to a strategy so you can return to them.

Create the Plan

As soon as a plan is completed, it is almost always just the beginning. This does not mean that we should be paralyzed by analysis, but you must be really careful about why you want to move forward.

Partner Internally and Externally

You're not interested in partnering with external providers entirely; you're not interested in doing everything in-house? You want a healthy balance based on your organization's competencies and an understanding of when to push and pull.

Iterate to Innovate

Embrace the constant iteration of your digital transformation journey. For both your members and staff, constant development is a winning strategy.

Here is the link to the entire session - https://culytics.com/articles/transformative-lessons-from-a-chief-digital-officer