Sunday, 14 January 2018

Role of Mobile in Digital Transformation

Our world has become increasingly digital. 

The mobile-first strategy is no longer valid as we live in the mobile-only world.

Today number of people having mobile phones on the planet is much bigger than bank account holders or credit card holders globally.

People use mobile devices as Swiss pocket knives: they serve a range of needs, activities, and purposes.

We shop and buy more of our products online or via mobile, we decide where to eat, buy a car, and hire a plumber by looking at the app digitally. Any critical decision that is made, a credit decision, admissions into a top university, accessing your social security benefits statement etc. are all made electronically.

With the proliferation of new digital platforms, businesses of are forced to rethink their physical presence. Gone are the days where you just have an app and a website: it’s vital now that mobile’s role is understood within the larger digital ecosystem.

Mobile is now present along every step of the end-to-end customer journey, from research and inspiration to return. Mobile is one of the most important touchpoints in the customer lifecycle.

Mobile has already stormed the Banking, Travel, Retail industries. Mobile has become an integral part of the shopping experience as consumers spend more time with mobile devices than with desktop and laptops combined.

Users leave billions of data points, which brands use, by applying analytics to personalize & keep them actively engaged to generate revenue. Integrating social media networking channels with the mobile apps would further allow the consumers interact freely with the enterprise, paying the way for increased brand loyalty.

With so many advances in mobiles, the mCommerce has also changed the face. Since the launch of iPhone, mobile commerce has moved from sheer text messages to apps. There are so many uses for ticketing, to money transfers, information services like news, stocks, traffic alerts etc.

Mobile payments have gained momentum and as more options become available, usage is set to surge. Consumers are adopting mobile wallet apps, Google wallets, smart watches and devices with Apple Pay, Samsung Pay t capabilities.

Mobile brings various advantages like portability, instant connectivity, personalization & localization of services. Further, it allows businesses to be visible to the customer at all times, build brand and recognition.

Even at work and out of office employees can benefit from mobile access to information, work from anywhere, reduce traveling and increase overall efficiency. While an organization can benefit from easy collaboration with team members, helping sales folks with quick information at their fingertips.

Businesses are focused on delivering growth and profitability with faster; better decision-making, & mobile technologies appear to be in the driver’s seat in this Digital Age.

Sunday, 7 January 2018

Artificial Intelligence in Financial Lending

I remember the 90s when I wanted to get a home loan and it took me 3 months to complete the process from providing all the hard copies of my income, tax returns, identity proofs then bank checked my creditworthiness & provided the approval.

Today everybody has some kind of loans like home loan, auto loan, education loan, two wheeler loan or even loan to buy appliances like HD TV and Refrigerator.

How do they assess your creditworthiness? There are so many cases of defaulters, which keeps increasing and hence established banks or lenders constantly looking for ways to improve the returns or proactively identify risks.

Lenders traditionally make decisions based on a loan applicant’s credit score, a three-digit number obtained from credit bureaus such as the TransUnion, Experian, and Equifax.  But these credit scores are based solely on credit-history and do not take into account rich data available, which can potentially give lenders access to data points as varied as online purchases, the strength of social connections and travel patterns. When viewed this data holistically, lenders can get a complete picture of potential borrowers & can significantly improve their ability to predict loan defaults.

Today digital transformation has changed everything. While the interest rate and closing costs on loans are still primary considerations, the speed, simplicity, transparency and customer service of the entire process is important.

As the purchasing power among millennials & gen Z continues to increase, they tend to purchase property and acquire assets that will provide stability & generate wealth.

The ability to cross-sell to these customers on loan products drives a significant portion of new loans. The difference for a digital-first customer is that they do their shopping online and may select an alternative provider based on the right combination of cost and ease of process.

Artificial Intelligence is used today, to determine the creditworthiness of those who don’t have any credit history like students or immigrants etc. It also helps to improve customer experience, e.g. by showing pre-approved loan amount. AI makes loan approvals quick and easy, reduce operational costs and these savings can then be extended to customers in the form of lower rates. Artificial Intelligence can process large amounts of data that human underwriters would simply not be able to make sense of.

Machine learning streamlines the process, drastically reduces the likelihood of errors and significantly cuts down the time it takes to approve a loan and disburse funds to the borrower, thereby enhancing the customer experience.

AI & Machine learning also helps to detect fraud by comparing customer behavior with the baseline data of normal customers and removing outliers.

Today apart from credit score and income, lenders are also looking at the digital footprint, payment data from other sources, purchase history, professional reputation from LinkedIn and other sources.

This is called alternative data sourcing. The use of machine learning to analyze this alternative data in loans and credit rating is going to raise some privacy, ethical, and legal concerns.

The future of digital lending will reduce the friction associated with the borrowing process, eliminating paperwork and moving all of the steps of the customer journey to an online and mobile capability. AI and Machine learning will become an inherent part of financial lending.

Sunday, 31 December 2017

How to develop the Vision for Digital Transformation?

Digital Transformation is now a number one priority for many businesses. Over the past two years, businesses have put increased focus on digitally transforming their brands from the inside out.

It is an ongoing process of change based on the market and needs of the customers. To deliver this change successfully, there is a need to establish a clear vision with objectives & expected outcomes.

Simply put vision is a picture of how the organization will look like after stipulated time.

Importance of Vision:

·      Provides the big picture and clearly describes what your organization will be like in several years
·      Clarifies the right direction of change to ensure that everyone is moving forward
·      Inspires everyone to take action in set direction
·      Synchronizes the action of different people. It provides self-sufficiency to individuals and teams while reducing conflicts.

There are some do’s & don’ts for setting up a vision:

Do’s:
·      Develop a Vision that is in line with company growth strategy.
·      Connect with partners who support your vision, not only third-party technology vendors but your own customers and employees
·      It should create the sense of urgency
·      Link vision to specific goals in future
·      Describe how the company will actually change
·      How will you engage differently with customers?

Don’ts:
·      It remains only as floor branding and marketing
·      Restricting the employees with set vision & its boundaries
·      Vision is way too complicated, vague and lacking actionable initiatives
·      Poor communication of the vision beyond the involved few stakeholders
·      Setup the vision before analyzing current systems and operations

Vision brings in the cultural change that is required for Digital Transformation. People are extremely important in this roller-coaster ride. 

When the digital vision is not clear, that affects the speed of adoption of both senior management and middle management. People will not act just because technology is ready. 

Some successful vision statements, which helped companies in their digital transformation:

Google - To provide access to the world’s information in one click

Amazon - To be Earth’s most customer-centric company, where customers can find and discover anything they might want to buy online

Walmart - To be the best retailer in the hearts and minds of consumers and employees

GE - To become the world’s premier digital industrial company, transforming industry with software-defined machines and solutions that are connected, responsive and predictive

Ikea – To create a better everyday life for the many people

Southwest Airlines - To become the world’s most loved, most flown, and most profitable airline

A top-down vision is a cornerstone & catalyst for digital transformation. These and many companies have created great vision statements to survive in this digital age.

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