Driving innovation through a culture of change
Author: Jens Treskatis, Area Vice President – North EMEA Sales, nCino
Most financial institutions recognize that continuous innovation and the adoption of new technologies are necessary to keep pace with changing customer demands and tremendous competition. Yet many of them struggle to implement and manage change projects.
Numerous scientific studies have shown that poorly executed change processes within organizations lead to investment losses and negative outcomes. A mid-2000s McKinsey study of 40 enterprise-wide change projects found that organizations with excellent organizational change management (OCM) programs achieved an average return on investment (ROI) of 143 percent, while those with poor or no OCM programs achieved a return of only 35 percent (equivalent to a loss of 65 cents for every euro invested in the project). Another study indicates that excellent change management practices result in a project being six times more likely to achieve its goals. So strategically and operationally well thought-out change pays off!
For financial institutions to drive the adoption of new technologies and sustain the change management mindset, the corporate culture, processes and technologies must be in sync. Once the digital transformation project is underway, it should be an integral part of the business, as a study by Capgemini found that the companies that have a stronger digital culture are not only proven to be more financially successful than others, but also have the happier employees.
nCino has three tips on how to achieve sustainable organizational change and be successful in the long run:
- Define the goal – A key part of change is the goal. Why is the change necessary and meaningful? Employees, customers, shareholders, etc. need to be informed and convinced of the intention so that everyone can participate in the transformation. Why is the current state no longer sustainable, what benefits are sought through the change? A statement of intent should clearly present why it is worthwhile to work together on the transformation. It also serves as motivation throughout the process.
- Live the constant change – Change management is not a one-time process, but a continuous one. Launching is not the end of a change journey, but only the beginning. Financial institutions should view change as an opportunity to successfully evolve their organization. And if all employees understand change as part of their business model, they can better adapt to it and actively help shape it. Of course, flexibility and patience are required here. Since change never stops, there is no reason to rush the process. Frequent micro-transformations are often much easier to implement than changing very complex processes every few years.
- Bring in reliable partners – With financial institution leadership, leaders already have a complex role. Successfully implementing a large transformation project on the side is not possible. Therefore, it is advisable to work with partners who have already supported and accompanied many companies in the successful implementation of change projects. If financial institutions leverage their experience and outsource some of the work, they can focus on their core competencies and continue to grow their business.
The Corona pandemic has accelerated digitization enormously. Customer needs have changed accordingly. Financial institutions should successfully meet these demands with digital transformation processes so that they remain competitive in the future.