# How to define success and measure the impact of digital transformation
Author:  Pal Sinha, Barnali 
Author URL: https://financedigest.com/author/pal-sinha-barnali
Published: 2019-09-09
Category: TECHNOLOGY
Category URL: https://financedigest.com/category/technology
Meta Title: Unlocking Successful Digital Transformation in Financial Services
Meta Description: Discover how Ross Timms, Head of Strategy at Rufus Leonard, helps financial services organisations overcome barriers to successful digital transformation by
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Tag URLs: featured (https://financedigest.com/tag/featured)
URL: https://financedigest.com/how-to-define-success-and-measure-the-impact-of-digital-transformationhtml

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By **Ross Timms**, Head of Strategy at Rufus Leonard

![Ross Timms, Head of Strategy at Rufus Leonard,](https://prod.superblogcdn.com/site_cuid_cm5qst7v3003gwirgwqtxn8i8/images/ross-1736838996963-compressed.jpg)

Ross Timms, Head of Strategy at Rufus Leonard,

For many businesses, digital transformation is now a key business priority that requires immediate resolution. With 85% of enterprise decision-makers stating they have a two-year period to make significant inroads into digital transformation or they will fall behind their competitors and suffer financially [\[i\]](#_edn1) and $1.18 trillion predicted to be spent globally on digital transformation technology and services in 2019 [\[ii\]](#_edn2).

The reality is that transformation is unique to each individual business, and often fraught with challenges. It’s expensive, time consuming, and changes may need to [operate alongside existing legacy](https://www.financedigest.com/holcim-supports-resolution-with-u-s-regarding-legacy-operations-in-syria.html "Holcim supports resolution with U.S. regarding legacy operations in Syria") systems and BAU governance as they’re being introduced. (Which could be why Capgemini found that 50% of banks and 56% of insurers were found to have barely started the digital transition and are thus being classed as beginners [\[iii\]](#_edn3).) With less than one in six organisations delivering successful digital transformation programmes [\[iv\]](#_edn4) and just 12% of global financial institutions considered a ‘digital transformer’ by Gartner [\[v\]](#_edn5), it’s clear that many companies struggle to get it right.

Ross Timms, Head of Strategy at Rufus Leonard, shares how financial services organisations can overcome the two main barriers to successful digital transformation: definition and impact.

**What’s the right transformation for your business?**

To be successful, you need to know why you want to transform, and therefore what kind of transformation your [business needs](https://www.financedigest.com/pstn-isdn-switch-off-what-businesses-need-to-know.html "PSTN/ISDN switch-off: what businesses need to know "). Following 30 years of helping [business leaders](https://www.financedigest.com/economic-outlook-has-darkened-business-and-government-leaders-warn-in-davos.html "Economic outlook has ‘darkened’, business and government leaders warn in Davos") transform their organisations – from BT’s first website in 1994 to BBC’s future of voice strategy in 2019 – we typically see three distinct types of transformation, each with their own characteristics:

- **Change how you do business:** responding to changing consumer demands, running the same fundamental business but delivering it in new ways, with new processes and through new technology.

Example: Fidelity – one of the largest [asset managers](https://www.financedigest.com/iot-platform-wells-up-south-africas-silulumanzi-water-utility-power-asset-management-savings-and-monitoring.html "IoT Platform Wells Up South Africa’s Silulumanzi Water Utility Power Asset Management Savings and Monitoring") in the world, which is over 70 years old – have invested $2.5 billion a year on technology through Fidelity Labs and Fidelity Centre for Applied Technology to deliver new and innovative products to the market. With a focus on blockchain, [artificial intelligence](https://www.financedigest.com/types-of-artificial-intelligence.html "artificial intelligence") and virtual reality, they have launched an interactive money check-up, a first-of-its-kind brokerage app with a customised feed based on user assets, and FidSafe which is a free secure online tool to store all of a family’s most important documents. Fidelity have also been transitioning into a new style of business; interestingly, one that competes with tech firms like Nvidea rather than their traditional [Wall Street](https://www.financedigest.com/investors-eye-lower-wall-street-on-powell-nerves.html "Investors eye lower Wall Street on Powell nerves") rivals like Charles Schwab.

For Fidelity, their success is clear to see. In 2018, despite a slowdown of [stock markets](https://www.financedigest.com/online-trading-and-stock-markets.html "Online Trading and Stock Markets") (the worst performance in a decade), Fidelity was able to hit record financial performance; with a 19% operating income rise, 12% boost in revenue to a record $20.4 billion and hit annual income over $6 billion for the first time.

- **Change your [business](https://www.financedigest.com/lane-change-assist-systems-market-overview-business-growth-development-factors-application-and-future-prospects.html "Lane Change Assist Systems Market Overview – Business Growth, Development Factors, Application And Future Prospects"):** changing your business offering and responding to evolving needs and behaviours by solving problems in new ways.

Example: To create products and services for SMEs, NatWest decided not to use their existing business and infrastructure. Instead they launched Mettle, a new digital-only business [current account](https://www.financedigest.com/euro-zone-current-account-swings-back-to-a-surplus-in-june.html "Euro zone current account swings back to a surplus in June"). Mettle is just one example of an innovative solution coming out of the bank’s portfolio of initiatives, ventures and products to better support SMEs across the UK – responding to customer needs with new features developed quickly.

Plus, NatWest Tyl, the [bank’s re-entry into the merchant acquiring market](https://www.financedigest.com/digital-inclination-to-drive-the-mammalian-cell-banking-market.html "Digital Inclination to drive the Mammalian Cell Banking Market") was announced in May; NatWest APtimise, the UK’s only end to end accounts payable solution; and automated lending platform ESME, which announced in March it has already lent over £50m to UK businesses. These all offer [business customers](https://www.financedigest.com/why-late-payments-are-hurting-your-customer-as-well-as-your-business.html "Why late payments are hurting your customer, as well as your business") more choices in banking.

- **Change your market:** understanding how changing behaviours will [create new markets and being there to meet that demand](https://www.financedigest.com/growth-of-mineral-processing-and-mining-industrie-is-creating-demand-for-rotary-trommel-market.html "Growth Of Mineral Processing And Mining Industrie Is Creating Demand For Rotary Trommel Market") first.

Example: With a clear transformation strategy set out; moving from a products-based company to a platform, PayPal has delivered innovation, [digital experiences and partnerships which have set it totally alone in the digital payments](https://www.financedigest.com/why-anti-spoofing-fingerprint-technology-is-essential-for-the-continued-growth-of-digital-payments.html "Why anti-spoofing fingerprint technology is essential for the continued growth of digital payments") market. The company’s ability to evolve through innovation while [providing customers](https://www.financedigest.com/verasity-joins-the-brightcove-marketplace-to-provide-customers-with-proprietary-ad-tech-technology.html "Verasity Joins the Brightcove Marketplace to Provide Customers With Proprietary Ad-Tech Technology") with more freedom in how they want to pay has been key to this.

Most recently, PayPal have created partnerships with banks to enable customers to sign-up to PayPal using their bank card, link reward points from multiple banks to their PayPal wallet, and used its open technology platform to expand partnerships with the likes of [Google and Apple](https://www.financedigest.com/uk-investigating-apple-google-mobile-browser-dominance.html "UK investigating Apple, Google mobile browser dominance") to allow payment using PayPal account and fingerprint authentication.

In 2018’s full year results, PayPal posted [growth across](https://www.financedigest.com/tea-pitchers-market-sales-will-witness-stellar-revenue-growth-across-top-regional-pockets.html "Tea Pitchers Market Sales Will Witness Stellar Revenue Growth Across Top Regional Pockets") the board due to its transformation efforts. This included revenue growth of 18% to $15.45 billion, a [17% increase in active accounts to 267 million and 9.9 billion payment transactions which was a rise](https://www.financedigest.com/tods-sales-rise-17-in-first-half-of-year.html "Tod’s sales rise 17% in first half of year") of 27%.

The drive to [digital transformation](https://www.financedigest.com/digital-transformation-for-the-world-of-finance-the-rise-in-collaboration-tools-and-saas-applications.html "Digital transformation for the world of finance: The rise in collaboration tools and SaaS applications ") needs to balance two things: the practical need and the requirement for a north star. The former is driven by pressure on [profit and the need to move at the speed of the consumer](https://www.financedigest.com/adapting-payments-to-reassure-consumers-and-safeguard-profitability-during-times-of-uncertainty.html "Adapting payments to reassure consumers and safeguard profitability during times of uncertainty"). The latter is driven by your company’s mission, purpose or vision. Aligning your brand to your technology gives your platform a purpose, a role beyond the practical and a [clear point of focus which drives transformation efforts](https://www.financedigest.com/turkey-clears-away-rubble-from-earthquake-rescue-efforts-wind-down.html "Turkey clears away rubble from earthquake, rescue efforts wind down").

**Find a clear point of focus**

Defining the purpose of your transformation programme is integral to measuring its impact and success. Once you’ve defined your ‘why?’ you can distil this into a single point of focus that explicitly meets top-line commercial objectives.

Looking back at our three brand examples, all of them can demonstrate this single point of focus. Fidelity aligned everything [back to their ‘Community Bank’](https://www.financedigest.com/major-myths-and-questions-holding-banking-and-financial-services-back-from-full-digital-id-adoption.html "Major myths and questions holding banking and financial services back from full digital ID adoption") vison. NatWest decided they [need to offer simple banking](https://www.financedigest.com/traditional-banks-need-an-overhaul.html "Traditional banks need an overhaul") in an SME environment. And PayPal have always had a pinpoint focus on democratising financial services to enable everyone to participate fully in the [global economy](https://www.financedigest.com/stanchart-sees-asia-middle-east-as-bright-spots-in-weak-global-economy.html "StanChart sees Asia, Middle East as bright spots in weak global economy"). That single point of focus gave each of these [businesses a clear steer on how to define both growth](https://www.financedigest.com/extracts-and-distillates-market-overview-high-demand-recent-trends-future-growth-business-scenario-technology-2022-2029.html "Extracts and Distillates Market Overview, High Demand, Recent Trends, Future Growth, Business Scenario & Technology 2022-2029") and performance objectives.

In turn, this single point of focus acts as a guiding star for how to leverage your brand, how to shape your [customer experiences](https://www.financedigest.com/the-next-generation-of-customer-experience-in-banking.html "The next generation of customer experience in banking"), understand what’s required of the organisation and your technology platforms. Ask yourselves, ‘how might we defend or improve our brand [market position/ensure ongoing user relevance/create internal alignment/maximise platform](https://www.financedigest.com/brics-aerial-work-platforms-market-competitive-growth-strategies-based-on-type-applications-end-user-and-region.html "BRICS Aerial Work Platforms Market Competitive Growth Strategies Based on Type, Applications, End User and Region") performance?’.

**How to measure the impact of transformation**

Understanding this creates a clear platform to identify and align KPIs across the organisation. Do you need to increase brand value/equity or increase [share price](https://www.financedigest.com/siemens-ceo-watching-the-share-price-of-siemens-energy-ceo.html "Siemens CEO watching the share price of Siemens Energy – CEO")? Do you need to create channel shift through self-serve or [improve customer](https://www.financedigest.com/how-can-financial-firms-improve-customer-service-after-the-pandemic.html "How Can Financial Firms Improve Customer Service after the Pandemic?") satisfaction? Do you need to reduce employee churn or improve workforce utilisation? Or, finally, do you need to increase platform utilisation or ensure [security of data](https://www.financedigest.com/normalizing-advanced-cloud-data-security-with-normalyze-from-amer-deeba-and-ravi-ithal.html "Normalizing Advanced Cloud Data Security with Normalyze from Amer Deeba and Ravi Ithal") and information?

This approach makes sure that a micro view on performance aligns back to the macro measurement of impact and progress. It gives the business the levers it needs to keep everyone on course over a multi-year [programme of significant change](https://www.financedigest.com/ubs-makes-changes-to-buyback-programme-following-credit-suisse-takeover.html "UBS makes changes to buyback programme following Credit Suisse takeover"). And, crucially, it provides a clear goal to galvanise everyone in the business.

In recent years, we’ve helped brands like the Aviva, AA and Lloyd’s Register tackle large-scale digital transformation. As a result of [facing off the challenge](https://www.financedigest.com/how-to-overcome-the-challenges-faced-by-women-in-business-4.html "How to overcome the challenges faced by women in business") of delivering successful transformation, we’ve created the Business Impact Matrix. Built on the principles explored here, the tool establishes a clear point of focus for all business units, aligning growth and performance activities. It ensures that all customer-facing and colleague-facing activities align to a shared goal and clearly aligned objectives. The tool drives a process of prioritisation, helping to align separate agendas and providing a clear framework to decide what to do first, second and so on.

However, you choose to define success, bringing both vision and impact into a single tool is the biggest single [step](https://www.financedigest.com/single-broadband-network-is-right-step-for-italy-vivendi-says.html "Single broadband network is ‘right step’ for Italy, Vivendi says") any organisation can take to make sure they are part of the 15% of companies that are successful with their transformation ambitions. [\[1\]](#_ftn1)

[\[1\]](#_ftnref1) The Digital Helix

[\[i\]](#_ednref1) Forbes

[\[ii\]](#_ednref2) IDC – Worldwide Semiannual Digital Transformation Spending Guide

[\[iii\]](#_ednref3) Capgemini

[\[iv\]](#_ednref4) The Digital Helix

[\[v\]](#_ednref5) Gartner


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