As President and CEO of Baker Hill, John Deignan is responsible for casting vision for the organization, ensuring all teams are aligned to deliver loan origination technology that empowers banks and credit unions to better serve their communities. John is a dynamic senior executive with broad and diverse experience in global management for large public, private, and private equity-owned companies, generating millions of dollars in profitable growth. Deignan’s career highlights his commitment to supporting the success of financial institutions, having held several leadership positions at Diebold Nixdorf before joining Baker Hill. He is successful at building, organizing, and directing multi-disciplined teams to develop and deliver best-in-class innovative solutions. Most recently, John was responsible for leading the successful sale of Baker Hill from the Riverside Company to Flexpoint Ford in July, 2023.
Transformation Takes a Team (and Iteration)
It’s time the banking industry stops viewing digital transformation as an end goal and instead thinks of it as an evolution.
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Successfully executing digital transformation is one of the biggest challenges facing bank leaders today. According to McKinsey & Co. research, only 30% of banks that have undergone a digital transformation report successfully implementing their strategies; most fall short of their stated objectives.
Given how much time, capital and operational resources banks devote to digital transformation, it is crucial to find ways to de-risk these important initiatives to increase the chances of success.
To start, it’s time the banking industry stops viewing digital transformation as an end goal and instead thinks of it as an evolution. Embracing the process as an evolution allows banks to foster a culture of continuous improvement. This mindset inherently de-risks the digital journey, and acknowledges that bank leaders and their teams will learn things along the way. By approaching projects with an open mind, banks can find new opportunities to adapt and differentiate themselves from the competition.
Digital Transformation Killers
Neglecting People and Processes
While technology inevitably plays a major role in digital transformation, change management is an equally important part of the process. Aligning the bank’s people, business processes and technology is critical to success. The last thing bank leaders want is to make significant technology overhauls or force new processes that team members struggle to adopt long term.
Ignoring Incremental Victories
Another common killer in digital transformation is the inclination to seek immediate results from a major change. With large-scale digital transformation, it’s best to focus on incremental victories and foster a culture of continuous improvement. To increase the odds of long-term success, leadership should give the institution cultural permission to break up the components of digital transformation into phases and take them one at a time.
Drivers of Digital Transformation Success
Effective collaboration and coordination across the financial institution can drive a successful digital evolution strategy. Specifically, when banks align team members and business processes with the right technology, projects are more likely to succeed.
Effective Change Management
Leaders can effectively manage change by engaging all stakeholders in the project and mapping out current processes on paper. Helping everyone understand what is going on under the hood, and discussing what processes or workflows are needed to drive success and which improvements matter most, can get team members pulling in the same direction.
For example, a commercial lending leader can enlist the bank’s relationship managers, loan officers, credit analysts and underwriters to better understand what the ideal loan process looks like from the perspective of customers and other stakeholders. Perhaps it includes consistently funding commercial loans in 45 days or less. Soliciting such input from team members can help leaders understand what the target operating model should look like and then map out a plan to get there.
Such feedback can also reveal inconsistencies in processes and policies, as well as critical points of failure that need to be addressed. For example, if each banker has a slightly different process for originating commercial loan requests, there could be an opportunity to improve and standardize those workflows. Or perhaps a bank’s current process for compiling credit memos is consistent but leaves room for errors. The last thing a bank wants to do is automate a bad process. It’s better to first map out the ideal process and then apply technology to ensure the execution is as efficient as possible.
Define Specific KPIs
When kicking off a digital transformation project, leaders often consider the key performance indicators and objectives they want to achieve. No matter how well-intentioned, these objectives often can be overly broad or generic. For example, leaders will say they want to increase efficiencies, drive loan growth or close loans faster. While these are great high-level objectives, focusing more on what is preventing the bank from getting there can help focus digital evolution and change management efforts on the things that matter most.
True Digital Evolution Takes a Team
Digital transformation is about more than embracing the right technologies. It’s an ongoing evolutionary process. Banks that strive for digital evolution by embracing a series of transformational changes that involve more than a piece of software can create a culture of continuous improvement to drive success.
John M. Deignan
As President and CEO of Baker Hill, John Deignan is responsible for casting vision for the organization, ensuring all teams are aligned to deliver loan origination technology that empowers banks and credit unions to better serve their communities. John is a dynamic senior executive with broad and diverse experience in global management for large public, private, and private equity-owned companies, generating millions of dollars in profitable growth. Deignan’s career highlights his commitment to supporting the success of financial institutions, having held several leadership positions at Diebold Nixdorf before joining Baker Hill. He is successful at building, organizing, and directing multi-disciplined teams to develop and deliver best-in-class innovative solutions. Most recently, John was responsible for leading the successful sale of Baker Hill from the Riverside Company to Flexpoint Ford in July, 2023.