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Assessing your digital maturity model

Nikhil Asthana Nikhil Asthana

Digital transformation remains a priority for the financial sector, and COVID-19 has increased the urgency of adopting digital services. Nikhil Asthana looks at how to optimise your digital journey and make the most of your digital capabilities.

Digital transformation is about using digital technology to improve customer experience, streamline processes and update ways of working in line with organisational need. It can improve agility, support innovation and attract new business. While digital transformation is a top priority for firms, there are still many un-realised benefits, including reduced costs, managing regulatory risk and maintaining operational resilience.

In addition to operational and financial benefits, the FCA is currently implementing its Open Finance plan. This broadens the scope of Open Banking to a wider range of firms in the financial sector, including investment firms, insurance firms, consumer credit firms, mortgage providers, investment and pension providers. Open Finance uses big data and APIs to improve data portability, interconnectedness across the financial sector and support growth in the FinTech sector. User consent also allows data to be shared across multiple providers to deliver an improved and bespoke service.

We look at some of the key benefits, challenges, and how to grow your digital maturity to realise them.

Benefits and challenges

An effective digital maturity model will help firms make the most of their digital propositions, and maximise the value of their investment in digital transformation programmes.

Customer centricity

The challenge of financial services organisations is to develop an integrated, digitalised, personalised customer journey covering all customer segments. Developing an integrated omnichannel experience for customers to interact and engage proactively will be an important differentiator for financial services organisations.

Cost reduction

Reducing discretionary spending will include prioritising manual activity automation and leveraging efficient operations and work-flow across all front-office, middle office, and back-office processes. Cost efficiency in essential risk, regulatory, resilience and cyber activities will also be a focus. Leveraging smart data platforms, RegTech tools and intelligent automation enablers will provide cost-efficiency returns.

Risk and regulation

Firms face increased risk and regulatory challenges, especially in the cyber, fraud, financial crime, resilience and Brexit regulatory divergence components. The ability to select and use integrated RegTech tools can reduce compliance risks and streamline processes.

Value creation and protection

As clients respond to economic conditions, maintaining value is a key theme. The ability to optimise digital channels, data underpinned by efficient automation and technology will create a competitive advantage.

Building digital maturity

Successful digital transformation processes rely on mature digital capability. To achieve this, there are six key areas for consideration, as demonstrated below. This is a useful framework for firms to assess digital maturity and establish key areas for improvement. It evaluates how well firms have incorporated digital processes into their operating models and the effectiveness of customer engagement and digital initiatives execution. A mature digital maturity model can drive long term business model sustainability and profitability.


1 Culture

Exploring your approach to culture and open communication will assess the extent to which employees are empowered in the decision-making process. This includes areas such as organisational adaptability, collaboration, experimentation, and diversity and inclusion. Getting these factors right can improve digital maturity and grant teams the freedom to find innovative new use cases for digital approaches.

2 Customer

Think about how the customer is placed at the centre of the digital strategy from engagement to insights. As discussed above, customer-centricity is a key benefit from digital transformation, but it relies on effective client engagement, good customer experiences, and trust. These factors are integral to create a personalised customer journey.

3 Sustainable Operating Model

Assess how people, processes and technology are organised within your business, to achieve sustainable strategic business objectives, whilst placing the customer at its core. Sustainable operating models rely on agile processes and procedures, intelligent workflows and operations, and integrated digital processes across all channels. This includes drawing on partnerships and outsourced providers for specialist expertise.

4 Capabilities

This looks at your business's digital expertise level and how you empower employees with technology to support digital strategy and execution. This can have a direct impact on talent retention, growth and employee engagement. Learning, development, and research approaches can help build digital skills and establish a future digital workplace.

5 Data

Look at the full suite of data capabilities required to enable successful digitalisation. Effective data strategy and governance underpins all digital processes. It supports platforms that can apply data science techniques to big data, supporting analytics processes and visualisation.

6 Technology

Consider how effectively digital concepts are implemented within your business and how they are being used to develop products and services. This includes how well infrastructure, cloud and applications have been optimised to support digital processes and new ways of working. It also includes reviewing your DevOps processes, intelligent automation, information governance and cyber security processes.

Next steps

Digital transformation is essential for any organisation looking to grow and stay ahead of the competition, but successful transformation programmes rely on a mature digital model which includes the elements above. Drawing on specialist expertise and partnerships can help you strengthen your model and embed digital solutions sooner.

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