{"id":3317,"date":"2017-02-06T12:38:15","date_gmt":"2017-02-06T07:08:15","guid":{"rendered":"http:\/\/www.allerin.com\/blog\/?p=3317"},"modified":"2017-02-06T14:36:42","modified_gmt":"2017-02-06T09:06:42","slug":"digital-value-creation-in-the-banking-sector","status":"publish","type":"post","link":"https:\/\/www.allerin.com\/blog\/digital-value-creation-in-the-banking-sector\/","title":{"rendered":"Digital value creation in the banking sector"},"content":{"rendered":"

\"\"<\/a><\/p>\n

To gain digital value creation, banks will have to fundamentally transform the way banking processes, clients, and banking executives operate. For implementing digital technology in banking, they must change their execution model to become more digitalized.<\/p>\n

<\/h6>\n

What are the steps in generating digital revenue?<\/p>\n

<\/a><\/p>\n

1.\u00a0\u00a0\u00a0 Create a List of Opportunities that Promote Digital Value Creation<\/h1>\n

The first step in the process of digital value creation is identifying and describing the potential digital revenue streams that can be applied to a bank\u2019s target objectives. CIOs must understand and explain each opportunity that provides digital revenue. CIOs can prepare case studies for further strategic and market use.<\/p>\n

<\/h6>\n

<\/br>
\nTake a look at the following table.<\/p>\n

<\/h6>\n

<\/br><\/p>\n<\/p>\n\n\n\n\n\n
<\/p>\n

Scope of Digital Revenue<\/o:p><\/span><\/b><\/p>\n<\/td>\n

<\/p>\n

Segment<\/o:p><\/span><\/b><\/p>\n<\/td>\n

<\/p>\n

Description<\/o:p><\/span><\/b><\/p>\n<\/td>\n

<\/p>\n

Enabling Technologies<\/o:p><\/span><\/b><\/p>\n<\/td>\n<\/tr>\n

<\/p>\n

Data Brokerage<\/o:p><\/span><\/b><\/p>\n<\/td>\n

<\/p>\n

Retail<\/o:p><\/span><\/p>\n<\/td>\n

<\/p>\n

This scope explores a proposition where clients are
\n willing to share their information with the advertisers. In such situation,
\n banks act as the broker among the clients and advertisers.<\/o:p><\/span><\/p>\n<\/td>\n

<\/p>\n

Enterprise data warehousing and mobile cloud
\n computing<\/o:p><\/span><\/p>\n<\/td>\n<\/tr>\n

<\/p>\n

Personal Data<\/o:p><\/span><\/b><\/p>\n<\/td>\n

<\/p>\n

Asset and Wealth
\n Management<\/o:p><\/span><\/p>\n<\/td>\n

<\/p>\n

This venture explores
\n the possibility of a bank that will be allowed to collect an individual\u2019s
\n personal data. The bank\u2019s task will be to protect and monetize the data
\n entrusted upon them by their clients. For instance, personal data banks can
\n perform operations like carrying out a house auction for a client or
\n communicating MRI and blood test results to any surgeon or healthcare
\n facility in advance of a surgery.<\/o:p><\/span><\/p>\n<\/td>\n

<\/p>\n

Cloud computing and IOT
\n devices.<\/o:p><\/span><\/p>\n<\/td>\n<\/tr>\n

<\/p>\n

Client Credential Tracking<\/o:p><\/span><\/b><\/p>\n<\/td>\n

<\/p>\n

Digital Business<\/o:p><\/span><\/p>\n<\/td>\n

<\/p>\n

This scope explores tracking of customer
\n credentials using third-party cookies. <\/o:p><\/span><\/p>\n

 <\/o:p><\/span><\/p>\n<\/td>\n

<\/p>\n

IGA and IAM<\/o:p><\/span><\/p>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n

<\/h6>\n

<\/br>
\nThus, CIOs can prepare a similar table as given above for studying use cases.<\/p>\n

2.\u00a0\u00a0\u00a0 Estimate the Strategic Value of Digital Revenue Opportunities<\/h1>\n

The second step in incorporating digital technology in banking is that CIOs need to evaluate the capacity of new digital revenues streams to create a positive impact on the client and boost their customer engagement strategy and financial institution performance.<\/p>\n

<\/h6>\n

Let\u2019s take a look at how to create an evaluation template to determine the strategic value of digital revenue streams.<\/p>\n

<\/h6>\n

<\/br><\/p>\n<\/p>\n\n\n\n\n\n
<\/p>\n

Number<\/o:p><\/span><\/b><\/p>\n<\/td>\n

<\/p>\n

Client Expectations <\/o:p><\/span><\/b><\/p>\n<\/td>\n

<\/p>\n

Bank Performance<\/o:p><\/span><\/b><\/p>\n<\/td>\n

<\/p>\n

ROI<\/o:p><\/span><\/b><\/p>\n<\/td>\n<\/tr>\n

<\/p>\n

1<\/o:p><\/span><\/b><\/p>\n<\/td>\n

<\/p>\n

Saving time<\/o:p><\/span><\/p>\n<\/td>\n

<\/p>\n

Boosts revenue<\/o:p><\/span><\/p>\n<\/td>\n

<\/p>\n

Payback Time<\/o:p><\/span><\/p>\n<\/td>\n<\/tr>\n

\n

2<\/o:p><\/span><\/b><\/p>\n<\/td>\n

\n

Providing transparency
\n in data access mechanisms<\/o:p><\/span><\/p>\n<\/td>\n

\n

Increases productivity<\/o:p><\/span><\/p>\n<\/td>\n

\n

Existing gaps in
\n skills<\/o:p><\/span><\/p>\n<\/td>\n<\/tr>\n

<\/p>\n

3<\/o:p><\/span><\/b><\/p>\n<\/td>\n

<\/p>\n

Giving advanced security measures<\/o:p><\/span><\/p>\n<\/td>\n

<\/p>\n

Minimizes frauds<\/o:p><\/span><\/p>\n<\/td>\n

<\/p>\n

Secured firewall solutions<\/o:p><\/span><\/p>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n

<\/h6>\n

<\/br>
\nYou can use the following scale to calculate the impact of a use case on the bank\u2019s performance.<\/p>\n

<\/h6>\n

0 = No impact<\/p>\n

<\/h6>\n

1 = Very low impact<\/p>\n

<\/h6>\n

2 = Low impact<\/p>\n

<\/h6>\n

3 = Medium impact<\/p>\n

<\/h6>\n

4 = High impact<\/p>\n

<\/h6>\n

5 = Very high impact<\/p>\n

<\/h6>\n

 <\/p>\n

You can place this indicator against each use case to evaluate which will provide optimum benefits to banks.<\/p>\n

3.\u00a0\u00a0\u00a0 Adopt an Open-Platform Strategy for Implementing Digital Technology in Banking<\/h1>\n

By adopting an Open-Platform, banks can promote the development of business ecosystems. It will help CIOs in determining a bank\u2019s industry vision and assist them in enabling value-creating conversations with clients. An Open-Platform strategy can also facilitate development and exchange of financial products, services, and social currency. It also allows banking platforms to share technological assets like data, algorithms, and interactions between people, and monetary transactions.<\/p>\n

<\/h6>\n

For enabling digital value creation, CIOs must focus on developing mobile channels that can pool data from various locations and provide valuable insights into a customer\u2019s financial journey. By utilizing these insights to develop new products and services, digital technology in banking can be implemented successfully.<\/p>\n","protected":false},"excerpt":{"rendered":"

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