Agile in FinTech for Responsive and Sustained Innovation

Most banks are bound to a physical branch distribution strategy, making them just as vulnerable to disruption from tech companies as the retail industry once was. Many big financial services firms are under increasing pressure from new, unconventional competitors. The most disruptive of these entrants create and deploy many innovations, identify the winners, and then expand at rates that these big institutions cannot match. The same destiny could await financial institutions if they fail to digitally alter their business models in a timely manner.

What is Agile in Fintech?

Agile is an operational approach that focuses on decomposing complex, long-term hierarchical operations into smaller, continuous-execution increments. Initially conceived as a methodology for software development. Agile has subsequently spread to a variety of operational operations, ranging from marketing to procurement.

An agile financial firm, on the other hand, is an organization that has a robust yet flexible process for choosing which product features should be produced next, who will take the lead, and how new projects will be integrated with existing processes.

Gathering Around Agile

To become more flexible, financial services firms must adopt one of three paths:

1. Assessment and planning.

They must establish their vision, identify internal barriers to agility, and devise an enterprise transformation strategy. It’s about having a resourced change management strategy. Any systemic change requires a way to gather and analyze stakeholder feedback. Progress is driven by feedback.

2. Plans for implementation.

Agile transformation seeks to swiftly produce customer value. Companies should form teams focused on specific aspects of the client experience. Managers should intervene often to remove obstructions that hinder the work of digital product teams, rather than using classic command-and-control methods.

3. Engineering platform and culture

Micro-services and application programming interfaces (APIs) are modern IT architectures and designs that take advantage of the latest technology infrastructure designs and cloud-based systems. Moreover, product engineers must adopt an automated systems culture, automating manual technological tasks whenever possible.

What Agile can do for your bank?

Banks with agile cultures bring innovative products and services to market considerably more quickly. Additionally, they are more adept at discovering and implementing cost-cutting measures. Additionally, customer satisfaction rates improve. The result can be illuminating:

• A financial services business situated in the United States reduced the time required to launch new features by 55% and the time required to test them by 70%. The cost of product development decreased by 40%.

• A major mortgage banking services provider in the United States reduced the time required to roll out new product features by up to 75%, from an average of 3-6 months to 6-8 weeks. Additionally, the percentage of customers who used the new features increased from 50% to 87 percent. Unsurprisingly, the company’s JD Power customer satisfaction score increased.

• After implementing an agile methodology, a large worldwide bank that was launching a digital channel for consumers seeking a mobile-first experience reduced the cost of customer research by 94%. Additionally, it lowered the time required to execute payments by 60% and the average time required to open a new brokerage account by 75%.

Benefits of Agile for Fintech

No component is more critical to the success of digital transformation than agility, and this is especially true in financial services. Cloud Primero has aided various financial services firms in adopting agile methodologies to maximize value realization on a global scale. Our experience demonstrates that agility is founded on five fundamental concepts.

Understand the larger picture

A digital transformation plan, a product release schedule, or a chart of desired outcomes may and should be displayed. Seeing the wider picture helps agile teams figure out what measures to take to accomplish their goals. Agile teams are multi-skilled and work effectively with business divisions to identify problems, discuss solutions, and implement them. Financial services organizations might employ this technology to change front-to-back consumer experiences (e.g., lending, customer onboarding). In other words, going from a conventional organizational structure with functional divisions like sales and fulfillment to an agile Spotify “Squads, Tribes, Chapters” model. The adoption of agile to improve business-IT cooperation on a big digital transformation initiative reduced time-to-market for new features by over 80%.

Agile is more than an IT concept for enhancing project delivery

Agile is a new way of thinking that demands commercial value from every project. A top broker/dealer used agile to transform a traditional platform into a distributed transaction posting system, boosting transaction rates and reducing market volatility.

Get results from agile digital

Agile helps digital capabilities produce unambiguous results. Shorter and more frequent release cycles give ongoing visibility to the company, making it simpler to pivot based on developing needs. Agile produces great results. Extending market coverage – new and national markets – giving additional value-added services, such as pre-approved or proactive offers, and curating new offerings outside banking, for example, helped a US bank grow income from digital channels by 25%. (e.g., lifestyle services).

On-Demand Delivery via DevOps

Agility is about building a continuous lifecycle of product development and delivery. New capabilities and high-quality goods or services may be offered on-demand via iterative delivery and business feedback. Using DevOps requires a specified technology and tools ecosystem. A large Australian bank discovered that DevOps increased the business feedback loop by 20X and expedited release cycles, resulting in quicker time to market and faster reaction to changing market demands.

Innovate constantly and responsibly

While agile helps firms build a culture of experimentation and invention, this culture must be cultivated throughout the company and not be limited to a single “innovation team.” Events like hackathons and ideation, which concentrate on cross-functional cooperation, help organizations stay ahead of the innovation curve.

Cloud Primero can help your company build modular teams and adopt Agile and DevOps practices.

Change is required by consumers. Markets are subject to fluctuations in price and liquidity. When it comes to controlling their operations, many banks, on the other hand, are stuck in place. Determinations are made from the top down, and by the time an essential concept is delivered to the appropriate individual, a more experienced rival has already introduced a new feature.

With Agile, businesses of any size and background can function as agile startups, which is exactly what the banking sector needs. Cloud Primero has worked with several big financial institutions in adopting agile at scale and has defined many leading processes by focusing on its clients’ experiences to help them with innovation and smooth process execution.  In banks, Agile enables the rapid deployment of squads to release new features faster, the formation of cross-functional teams to plot the next best growth vector, and the provision of technology leaders with tools to ensure that IT infrastructure can effectively scale and support the expanding spectrum of business requirements without fail.