3 Major Challenges Financial Institutions Face When Implementing Business Insight Technology

StrategyDriven Organizational Performance Measures Article |Financial Institutions|3 Major Challenges Financial Institutions Face When Implementing Business Insight TechnologyIf you’ve been in the market for new business insight technology, such as a financial services analytics solution, the benefits of these are obvious. Promises made by your technology partner, such as increased analytics capabilities and improved compliance with regulators, are probably at the top of your mind. But you must also remember that any new technology you onboard will bring change to your bank’s operations—some of which isn’t welcome just yet. It won’t be as simple as rolling the software out across your enterprise, then expecting everything to go smoothly from thereon.

It’s usually the job of a bank’s chief financial officer (CFO), chief risk officer (CRO), or chief technology officer (CTO) to oversee tech implementation. If you’re in any one of these positions, you must be wondering how you can complete your implementation or modernization initiatives with the least amount of friction possible. It helps to know the challenges associated with introducing this kind of technology, so that you’re better prepared to win staff buy-in when needed. To guide you, here are some common obstacles to implementing new business insight technology. You’ll learn what drives these problems, as well as how to address them and guarantee an integration process that’s as smooth as possible.

A Resistant Culture

The first challenge that you’re likely to encounter is a familiarity bias within your institution. People may be partial to the bank’s existing way of doing things, especially for major tasks like financial analysis and reporting. They might be intimidated by the new software, as this will be their first time to see robotics and machine learning applied in banking processes. Or, they may be skeptical about whether it’s worth the cost, or the risk to a high-stakes profession such as finance. This kind of resistance is possible across different levels of the enterprise, from upper management to rank-and-file banking staff.

Those directly in charge of onboarding the technology must accommodate these doubts and prove that the new software isn’t as scary as it seems. Try to illustrate in concrete terms that the tech will serve a very practical purpose. It will make the task of deriving insight easier—not harder—to do.

Also worth explaining to your colleagues is that the tech will put you in a highly competitive position: that of an early adopter. It will allow your institution to master important business trends faster than your peers. You’ll also be better equipped to leverage your brand as a forward-thinking and future-ready one.

Admittedly, it may take some time for your institution to get over its initial resistance. But eventually, they will see for themselves that the investment is a rewarding one.

The Need to Align Technology with Human Capabilities

The next major challenge is ensuring that staff can sync up their human abilities for deriving business insight with that of their new technological counterpart. After all, it isn’t only technology that you should depend on to improve your bank’s situation. You also need to pay attention to the technology’s intended users and how the tech can enhance the way they work.

The staff who are in charge of financial analysis and compliance will likely have to adjust their workflow to accommodate the technology. So even if you’re onboarding a solution that’s easy to use, it would still be prudent to schedule further training with staff. You should also ensure that your bank’s IT staff are properly oriented on basic troubleshooting. If technical analysts run into sudden problems like server errors, at least your IT team will know where to start.

One thing’s for sure: the use of AI and machine learning in financial services analytics doesn’t necessarily mean that work done by humans is obsolete. The tech can actually enhance the quality of human staff work while relieving the latter of the more rote aspects of financial analysis. A smooth transition into staff members’ workflow and some additional practice with the software will make all the difference.

The Fear of Breaches to Data Privacy and Security

The final challenge pertains to assuring stakeholders that the bank’s financial data will be safe. Since banks handle huge volumes of sensitive customer data, this anxiety is very much warranted. It isn’t only money that a bank would stand to lose in a major data privacy breach or system-wide error. The institution could also lose the trust of its customers and the general public, which takes years to build.

You must have enough proof that the new business insight technology isn’t weak against malicious attacks and isn’t easily compromised by human or server error. That’s why it’s crucial to sign on a technology partner of good repute, with an established track record for information security. Look for clear and strong policies on their part for how to protect sensitive data. Your technology partner should also demonstrate an adherence to a security standard befitting of your bank. Lastly, they should be forthright with you about how to work through the worst-case scenario and craft an effective recovery plan.

Conclusion: Overcoming the Challenges, Reaping the Rewards of Using Business Insight Technology

Given that new business insight technology is such a high-stakes investment, it’s all right for the decision to be subjected to scrutiny. The bank’s stakeholders deserve answers to their questions, and they deserve proof that onboarding the software will be beneficial to the institution.

If you adopt a solution you truly believe in, your enhanced ability to derive and act on key business insight will speak for itself. Don’t be afraid to invite conversation about how the technology will change things for the bank, and its potential for improving everyone’s analytics capabilities.