Digital / Agile Transformation within the Banking sector: ING Bank:

Businesses around the world across multiple sectors are looking to emulate the speed, dynamism and customer centricity of the digital players such as Google, Netflix and Spotify.

In the summer of 2015, ING embarked on such a journey, moving from a traditional organisation to an “agile” model.

McKinsey interviewed the CIO (Peter Jacobs) and the COO (Bart Schlatmann) of ING who explained why the banks needed to change:

McKinsey: What prompted ING to introduce this new way of working?

Bart Schlatmann: We have been on a transformation journey for around ten years now, but there can be no let up.

In our case, when we introduced an agile way of working in June 2015, there was no particular financial imperative, since the company was performing well, and interest rates were still at a decent level. Customer behaviour, however, was rapidly changing in response to new digital distribution channels, and customer expectations were being shaped by digital leaders in other industries, not just banking. We needed to stop thinking traditionally about product marketing and start understanding customer journeys in this new omnichannel environment. It’s imperative for us to provide a seamless and consistently high-quality service so that customers can start their journey through one channel and continue it through another—for example, going to a branch in person for investment advice and then calling or going online to make an actual investment. An agile way of working was the necessary means to deliver that strategy.

McKinsey: Can traditional companies with legacy IT systems really embrace the sort of agile transformation ING has been through?

Peter Jacobs: I believe that any way of working is independent of what technology you apply. I see no reason why an agile way of working would be affected by the age of your technology or the size of your organization. Google and ING show that this has nothing to do with size, or even the state of your technology. Leadership and determination are the keys to making it happen.

McKinsey: How would you quantify the impact of what has been done in the past 15 months?

Bart Schlatmann: Our objectives were to be quicker to market, increase employee engagement, reduce impediments and handovers, and, most important, improve client experience. We are progressing well on each of these. In addition, we are doing software releases on a two- to three-week basis rather than five to six times a year, and our Net Promoter Score and employee-engagement scores are up multiple points. We are also working with INSEAD, the international business school, to measure some of these metrics as a neutral outsider.

By Sanjay Chandarana - LinkedIn: https://www.linkedin.com/in/sanjayvertex/