Without the alignment of goals and proper change management, innovation becomes impossible.
October 12, 2010 | Aldo JosonAt no other time was innovation more in demand than during the previous economic cycle when banks were forced to adopt low-cost measures and still maintain healthy or near-healthy levels of productivity. As they slowly emerged from the crisis, disciplined governance was still needed to sustain the investment in innovation, ensure that these projects were still beneficial for the bank in the long term, and embark on projects that would address the changing demands of a rapidly changing client base.
Banks now have the capacity to use the savings from increased efficiencies generated by process- and platform optimization to invest in new technology and expansion opportunities. “However, banks need to demonstrate the sustainable addition of business value from investments in innovation,” Andrew Butcher, managing director, head of operations and technology, Asia Pacific at Citibank, said at The Asian Banker Summit. Without proper governance, these investments will go to waste, as measured by key metrics his bank has laid out.
Butcher said that the metrics used to measure the success of these investments come from two different perspectives. Business metrics include financial measures such as market share, revenue, expense, margin and operating leverage, while operational metrics such as channel utilization, channel performance and adoption rates are used as decision tools. While it is not always possible to perfectly correlate individual metrics to all projects, benchmarking externally and measuring performance over multiple quarters give a good perspective and the ability to separate external factors from the direct outcomes of a particular project.
It’s also important to decide on a set of measurements and then abide by
them. Using consistent historical reference data to learn from previous
experiences is a powerful tool in measuring the value proposition of new
initiatives.
<...
Categories:
Innovation, Technology & OperationsWithout the alignment of goals and proper change management, innovation becomes impossible.
October 12, 2010 | Aldo JosonAt no other time was innovation more in demand than during the previous economic cycle when banks were forced to adopt low-cost measures and still maintain healthy or near-healthy levels of productivity. As they slowly emerged from the crisis, disciplined governance was still needed to sustain the investment in innovation, ensure that these projects were still beneficial for the bank in the long term, and embark on projects that would address the changing demands of a rapidly changing client base.
Banks now have the capacity to use the savings from increased efficiencies generated by process- and platform optimization to invest in new technology and expansion opportunities. “However, banks need to demonstrate the sustainable addition of business value from investments in innovation,” Andrew Butcher, managing director, head of operations and technology, Asia Pacific at Citibank, said at The Asian Banker Summit. Without proper governance, these investments will go to waste, as measured by key metrics his bank has laid out.
Butcher said that the metrics used to measure the success of these investments come from two different perspectives. Business metrics include financial measures such as market share, revenue, expense, margin and operating leverage, while operational metrics such as channel utilization, channel performance and adoption rates are used as decision tools. While it is not always possible to perfectly correlate individual metrics to all projects, benchmarking externally and measuring performance over multiple quarters give a good perspective and the ability to separate external factors from the direct outcomes of a particular project.
It’s also important to decide on a set of measurements and then abide by
them. Using consistent historical reference data to learn from previous
experiences is a powerful tool in measuring the value proposition of new
initiatives.
<...
Categories:
Innovation, Technology & Operations