8CIOReview | | NOVEMBER 2021IN MY OPINION"One false step anywhere in the chain, and you've lost our confidence forever." That's how a Gen Z-er described to me how crucial it is for banks to deliver technology flawlessly. While we all know that keeping pace with consumer demands by offering great user experiences is critical for banks, we also need to provide perfect execution, soup to nuts. Younger consumers grew up in a world of Instagram, Amazon, and instant gratification. If technology doesn't work, they are unforgiving. For older generations, too, if they're going to experiment with technology, it's got to work. Otherwise, they'll never use it again, not with you, not with anyone. So I don't think high banking expectations are necessarily age-specific. It's fair to ask how small and mid-size banks can compete in this environment. Larger banks can disproportionately invest in technology. They can afford to build their systems and sink the kind of money into R&D that makes creating great solutions a slam dunk. Meanwhile, small and mid-size banks have to depend heavily on off-the-shelf solutions with less control and limited capability of customization. To compete, smaller banks must be focused on how they deliver technology, and this inevitably means tradeoffs when it comes to functionality. When you are on a budget and resource-constrained, providing all the bells and whistles in online banking, for instance, is difficult, given that you need a product that is easy to use, visually appealing, and most important: reliable. Outages--planned or unplanned--have to be minimized; you have to have a solid high-availability strategy and the right resources and contracts with vendors to ensure stability. Focus is key.On top of the basics, banks need to home in on their differentiators so they can be significant where it is most critically important. These differentiators must be tangible, meaningful, and aligned with your bank's business strategy. What makes my bank different from the bank down the street? What's my secret sauce? These questions can be challenging for any bank to answer, but the answers yield critical guidelines when it comes to investing your technology dollars.Does all this focus on digital mean branches are dead--as has been predicted for decades? If I had my crystal ball, I would say in the future there will be fewer full-service branches, but branches don't go away. While digital banking has become more common, the digital space still has limitations. Mobile phones even can't print cash, every bank has limits on ATM cash withdrawals, many businesses need a place to drop off money, and not everyone accepts digital payments.Plus, many consumers still want a physical presence. Even for millennials, I think it's a fallacy to say that they don't wish to branches. We've talked to younger folks, and they tell us that while they do want access to an office, what they don't want is the traditional branch model. And that's where TECH'S LESSON: MEET CONSUMER BANKING EXPECTATIONS EVERY STEP OF THE WAYBy Rich Fusinski, SVP & CIO, Flagstar Bank [NYSE: FBC]
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