James Robert Lay:
Get ready to go inside Digital Growth today because I'll be going into the Digital mailbox to answer questions that have come in from listeners around the world over the past few weeks. And these are really good questions that I know will guide you forward on your own digital growth journey, let's go.
James Robert Lay:
Greetings and hello, I am James Robert Lay and welcome to another episode of Banking on Digital Growth where I will lead you, I will guide you along your own digital growth journey, so that you can guide others on their financial journey, to lead them beyond financial stress towards a bigger, better and brighter future.
James Robert Lay:
Today's episode is part of the inside Digital Growth series and I'll be answering questions from three listeners that have come in and we're going to start here is Sherry. Sherry writes, you talk a lot about financial stress and I know why people feel the way they do about money, but what can my bank do to help these people? First off Sherry that's a great question and thanks to the production team for leading off with this one because it's always good when we can think about people. When we can put people at the center of our thinking and doing, this is where the real transformation happens, the transformation that so many financial brands are looking for.
James Robert Lay:
And it's important to note that, digital transformation Sherry, it's not about technology, and I think that's why so many struggle with digital transformation because we get lost in the technology. Digital transformation is about people, it's about putting people at the center of your thinking, it's about putting people at the center of you're doing, and in banking and financial services, we do know that money is stressful. And the number of people that feel stressed about money continues to grow year after year after year, this is the silent epidemic that I write and speak about, the silent epidemic that is taking a toll on people's health, their relationships, their overall sense of wellbeing, and we know that money can feel stressful, it can feel confusing, it can feel frustrating and overwhelming, and we also know that money is a very taboo subject, no one wants to talk about it publicly.
James Robert Lay:
It's easier for us to have conversations about sex than it is about dollars and sense. To me, this is one of the biggest opportunities for financial brands, for banks, for credit unions, for FinTechs to think about and really solve a problem here that can transform people's lives, it can transform people's families, it can transform their business, the communities that they're serving as financial brands, and then they can do this by reducing and eliminating this epidemic of financial stress.
James Robert Lay:
Yes, when we think about digital transformation, the technology, the AI, the automation, all of that is extremely important, but those are nothing more than tools that we can use to solve this great problem, one that impacts almost three out of four people that we know, and it could be people inside our own financial brands that are struggling with financial stress. And if we can address those people first, we can build stronger culture, we can build stronger organizations, and ultimately build stronger communities.
James Robert Lay:
So it is time, it is time for financial brands, for banks, credit units, FinTechs, to commit to put the transformation of people over the commoditized transactions of dollars and cents, and all of that must begin internally. If we can take care of our people first internally to make sure that they feel good, that they feel confident about their situation, then that will just naturally transcend externally so that our team can take care of others, our account holders, our prospective account holders. And so I'm excited for what the future holds when it comes to this type of thinking.
James Robert Lay:
And what I want to do now is I want to come to Jack's question here, because I think it really is a nice dovetail into your question Sherry. Jack writes, we've been dabbling in digital for a while, and my CEO is ready to get serious, where should we start? What should we focus on? Well Jack, like I've just mentioned to Sherry's question, it comes by building a strong foundation. I see when financial brands enter into the Banking on Digital Growth program, so many just want to jump to the fun stuff, the technology, the AI, the automation, the content, but none of this matters Jack if you don't have a strong foundation for digital growth. And after conducting hundreds of diagnostic studies, what we uncover is now at this point, it's not a lot of new insights it's more of the same repeated patterns.
James Robert Lay:
It's that, financial brands for the most part, they lack a strong foundation. On the flip side, we are finding FinTechs entering the scene with a much stronger foundation that they can build on, but it doesn't mean that all hope is lost for incumbent banks and incumbent credit unions. The difference here, because if you think FinTech, FinTech has the advantage because of technology, that's not the case.
James Robert Lay:
The difference is not rooted in technology but more deeply in the way that financial brands and FinTech think about their purpose, that's why purpose is at the center of the banking on digital growth blueprint, it's at the heart, everything orbits around the purpose of an organization. Once we have a strong purpose, a purpose that goes beyond the traditional mission or vision of a financial brand, it's a purpose that once again, back to the point of Sherry that I was speaking to her about, purpose puts people at the center of our thinking and doing, purpose can in fact help inform who the ideal consumer persona is that will ultimately connect with the purpose of the organization.
James Robert Lay:
Purpose can help inform alongside with personas now, product development, product positioning, purpose can also help in conjunction with product positioning, product development, the pathways that we guide people along to move beyond their questions and concerns towards their hopes and dreams, a bigger, better, brighter future if you will. All of these are elements, purpose, personas, product positioning, pathways, all of these are elements of a strong foundation that you can build upon going forward. And if that strong foundation is lacking, the best technology in the world will not help, the best technology in the world will not create value. So it all comes back to a strong foundation, rooted and built around purpose.
James Robert Lay:
Let's move over here to Allison's question. Allison writes, there are many different sides to digital, there's digital solutions for the customer, and there are digital solutions for attracting new accounts. Let's start here with digital banking in general, where are we headed? Where are we going next? So I think Allison your question is around digital banking, which is, I would actually kind of tuck that up underneath the solutions or the services side. And when we think about this, there are three core activities, there is marketing, there is sales, and there is service, and all of those elements compliment one another for ultimately achieving future growth.
James Robert Lay:
And so, I want to come back to digital banking here. Digital banking is the activity of banking, and the activity of banking is on the transactional side of the house historically, it's the online banking, it's the mobile banking, it's the loan and the deposit applications, and it's this transactional side of the house, this transactional side of the banking that is most easily commoditized. When it comes to technology and tools, I don't feel all hope is lost here because of the opportunity to use these tools, I want to connect this back to the point I was mentioning with Jack, we need to have a strong foundation first, but the opportunity comes from the data that we can glean from these tools, the insights that we can glean from these tools to make an even deeper human connection in a digital world, and that human connection, connecting this all the way back to the point that I was mentioning was Sherry, that connection comes from when we put people at the center of our thinking and at the center of our doing.
James Robert Lay:
And what I'm viewing as the ultimate human connection play is through financial coaching, to use the data, the analytics, the insights, to establish and ultimately maximize financial coaching as a core offering within an organization. This is not about financial education, this is not about financial literacy as something I know the industry has been focused on now for a very long time, financial coaching is the next level up. And back to the points that I was making with Sherry financial stress, we know that money is stressful and all of this boils down to people's habits when it comes to how they think and how they act financially, and a lot of those habits are rooted in their belief systems and structures that go back to their family of origin, their early childhood days, their environment, and even now how they think and feel about money impacts the future opportunities that they have.
James Robert Lay:
And utilizing technology, utilizing data, we probably know more about a person's financial habits than they know about themselves in many cases. And if we do believe as an organization, if we are operating from a lens of purpose to guide people, we know that we can help them identify growth opportunities. And this is where coaching, this is where accountability comes into play because, I predict financial coaching has the potential to be a future revenue stream that financial brands can add to their overall product portfolio to generate non-interest income as part of the subscription economy. Because if people are wanting to move from a present state to a future state, it is often very hard for them to do it alone, because those habits, those behaviors are so ingrained into their daily belief systems, into their daily actions, even deeper into the sub conscious mind.
James Robert Lay:
And so through financial coaching, we can help to create some awareness there, but we can also help to provide some accountability. And I'll probably do some more thinking about this on a future podcast episode, but this is what I'm looking at when it comes to digital banking and online banking, mobile banking, et cetera, is building financial coaching into that experience.
James Robert Lay:
Yes, it can be done through an app and we can provide some nudges, we can provide notifications, but I truly do believe it is the human element of financial coaching where the real transformation will happen because from a human behavior perspective, people are more likely to be held accountable by another human being than they are to be held accountable by a piece of technology. So these are really great questions here and as we wrap up another episode of banking on digital growth, I want to thank Sherry, I want to thank Jack and Allison for your questions.
James Robert Lay:
But I also want to hear from you the dear listener because, you might have a question that you'd like for me to answer and if you do, now is the time to text me the question that you've been thinking about that you'd like to get answers to on a future your podcast episode. So text your question to (415) 579-3004. That's (415) 579-3004, and always remember, always remember, there are no bad questions except for one, which is the question that goes unasked. Until next time and as always, be well, do good, and make your bed.
