Maximizing System Utilization: Implementing Technology Solutions

A key part of assessing whether a financial institution is maximizing its system utilization is evaluating its current technology stack to ensure it aligns with their stated strategic plans and goals. A thorough evaluation is likely to uncover a technology gap list where the current technology is not fully supporting their goals. Identifying a technology gap list and marrying it with the strategic direction of the organization can help the institution properly prioritize the changes they need to make and identify potential solutions that can augment the existing stack. In this fourth installment in a series of blogs about maximizing system utilization, PRI Director of Systems and Automation Mike Neale says if the technology gap list is substantial and focused on a specific platform, it may be time to seriously look at evaluating alternative providers.   

As we’ve highlighted in the previous blogs in this series, an institution often can achieve their objectives by simply making the most of what they already have. By automating manual processes, understanding and adjusting system parameters and capabilities and leveling up on reporting processes, banks can significantly improve profitability and position themselves for competitive advantage and long-term success. However, as the institution evaluates its system and digs deep for ways to improve and maximize their investment, they may discover wide gaps in the technology piece of the puzzle. How they choose to fill those gaps can look different at each institution.

When evaluating the technology stack, leaders should shine a flashlight into the following areas and ask, “Are my current systems supporting the FI’s long-term growth? What’s missing here?” Some areas to dig into include:

• Core
• Account and Loan Origination System (AOS/LOS)
• Digital Channel Delivery
• Reporting and Business intelligence
• Risk solutions
• CRM/MRM
• Workflow and Process Automation 

Best of suite vs. best of breed 

Neale said that there are multiple approaches for filling gaps in specific functional technology offerings.  The institution may buy a solution that is part of its core vendor suite (“best of suite”).  In addition, almost every core vendor sells ancillary systems for each common functional area, such as solutions to help originate loans or establish online banking. Frequently, these are more tightly coupled with the core solution. Alternatively, they may purchase ancillary solutions from another vendor (“best of breed”). 

“If an institution is strictly a ‘best of suite’ technology buyer that sources most of its tech stack from the core vendor, it may be time to open their minds to consider a ‘best of breed’ ancillary solution. As the market advances and evolves, there may be solutions out there that did not exist just a few years ago,” Neale said. “However, when considering that type of change, be sure to assess whether the overhead of supporting solutions from multiple vendors won’t overshadow any savings contemplated by the change.” 

The explosion of automation 

Neale said in many cases, technology gaps can be resolved through the addition of process automation software. Functionality in this area has exploded in the last few years, producing solutions that go well beyond historical Robotic Process Automation (RPA) to AI-driven intelligent workflow automation systems. 

But while it can be tempting to get excited about the “bells and whistles” innovative technology can offer especially in this time of emerging AI, Neale said institutions must always ask what they are trying to accomplish and how they will do it more cost effectively than the competition. He recommends focusing on continuous improvement that helps the organization reach its strategic goals, rather than having all the cool toys that are available. Be selective, he advises. 

“You can’t cross digital payments off your list because you implemented Zelle or think you’re on the other side of the digital banking divide because you finally have digital account opening. The world keeps moving and the bar keeps getting higher. That doesn’t mean you need to mindlessly try to keep up in the digital arms race, where 98% of banks are hopelessly outgunned. It means understanding where you choose not to play, where you need to play defense to stay in the game, and picking those few spots where you can win.” Why Your Strategic Plan Sucks, Alloy Labs

Don’t skimp on the talent piece

Neale said it’s important to have team members who “own” the technology the institution has already purchased. They should be well versed in its limits as well as its potential, and they should take advantage of any training or education opportunities offered by the vendor. Vendors often offer periodic, free operational reviews of the system, which can be a good source of additional training for the tech team. Outside experts like PRI also can help guide banks in their selection process by knowing what’s out there and how certain solutions may fit with strategic goals. 

“With great consistency, the organizations that I see being most successful in achieving high system utilization and high levels of efficiency have developed talent that are well versed in the capabilities of the systems they’ve already acquired,” Neale said. “Be sure you’re thoughtful in your talent acquisition process and then give them the resources to get the most out of the systems you’ve already acquired.”

PRI experts and series contributors

Mike Neale, PRI’s Director of Systems and Automation, has more than 25 years of experience in organizational transformation and acceleration, specializing in financial technology and operations. He has served as CIO for multiple financial institutions and financial technology companies where he developed and led execution of strategic business and technology plans including infrastructure design as well as assessment, selection and negotiation of core and ancillary solutions.

Resources 

4 Tips for Aligning Technology with Business Strategy – Profit Resources, Inc. 

Why Your Strategic Plan Sucks – Alloy Labs 

From the Maximizing System Utilization series…

Maximizing System Utilization: Ditch Paper and Manual Processes – Profit Resources, Inc. 

Maximizing System Utilization: Understanding Parameters and Capabilities – Profit Resources, Inc. 

Maximizing System Utilization: Harnessing the Potential of Reporting Systems – Profit Resources, Inc. 

PRI specializes in identifying profitability improvement areas for financial institutions through revenue growth, cost control, streamlining processes, and effective use of technology. Contact us to learn more about our personalized approach to propel growth and improve profitability.