SAN FRANCISCO — Digital transformation is trending in the lending community, but while many banks initiate the process “very few actually succeed,” Starling Bank founder and Chief Executive Anne Boden said Wednesday at FinovateSpring 2022.

“Everybody wants to transform, everybody wants to be a new, innovative, creative player,” Boden said. “But actually, launching a digital transformation … is ever so complicated.”

Chase and Citibank, for example, started digital transformation initiatives, but the projects ended up failing, she said, noting that while “most change initiatives fail” that is how change happens.

At Starling Bank, which has 3 million accounts and represents 8% of the business banking market, the focus is on new technology and constant change, Boden said. The bank releases software roughly 10 times per day, she added.

While implementing new technology and eliminating the fear of change presents a challenge, lenders can lean on the following four strategies to change the experience for consumers from the core of the bank outward:

1. Less planning, more doing: “Why are we still spending 90% of the time on project planning and only 10%, or even 5%, on doing?” Boden said. Lenders need to move away from the idea that planning is cheap and coding is expensive because now, technology “is easier to build and easier to iterate.”

“For those chief technology and chief information officers in the audience that have been told to plan, plan, plan … forget that knowledge, it is no longer relevant,” she added.

2. Change is not a risk: “Modern-day technology and modern-day projects are all about a little bit of change very, very often,” Boden said. Lenders must spend less time worrying about what might go wrong, and more time worrying about their reaction if something actually does go wrong.

“Don’t be fearful of change,” she said.

3. Delegate decision-making: Lenders benefit from delegating their decision-making power to those with day-to-day knowledge about an organization’s technology and coding, Boden said. People at the top often think they know it all, but they don’t. And giving up power – which might seem terrifying – will result in “better decisions,” she said.

4. Strengthen the bank’s core: Lenders implement service partners, build apps and automate their core systems, “but nobody is replacing [their processes],” Boden said, noting banks are afraid of changing their core systems because “projects go wrong.” However, “you’re not going to get the real benefit of a new transformation of a new set of technology of your business unless you transform the core,” she added.

Editor’s Note: This story was previously published on Bank Automation News’ sister site, Auto Finance News.

Bank Automation Summit Fall 2022, taking place Sept. 19-20 in Seattle, is a crucial event on automation and automation technology in banking. Learn more and register for Bank Automation Summit Fall 2022.