Management Strategies

04:14 PM
Edward R. Merchant, Cognizant
Edward R. Merchant, Cognizant
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Using Social Media to Drive Operational Change: Part 2

The second article in this two-part series offers three core principles that financial institutions must embrace in order to start using social media to help drive operational change.

In the first article in this two-part series I suggested that there is a significant opportunity for the financial services industry to leverage social media models and technologies in operations. More specifically, I stated that the use of social media would enable organizations to more dynamically overcome the efficiency impediments perpetuated by historically-biased organizational structures and semantic limitations of IT architectures. Most importantly, the use of these tools would allow organizations to transform operations staff from being a necessary cost to a true service differentiator. Here, I offer three core principles that financial institutions must embrace in order to move forward with such initiatives.

Understand the "Chess Board"
Although the world is still in the process of figuring out how to make money from social media, one concept that has become pretty widely accepted is that this capability comes from the way in which connections enable unanticipated interactions around products, services and ideas. Just as importantly, progress comes from watching these interactions and then opportunistically exploiting what is learned.

Like a game of chess, where pieces are constrained by the boundaries of the board and various conventions regarding their movement, operations are bound to observe certain policies and norms. However, the trick is to determine which rules are inviolate and which are self-imposed. For example, many organizations will concede that most of their internal policies on data security are not driven by specific regulatory requirements; they are put in place based on a "better safe than sorry" principal because it is too difficult to properly monitor communication channels.

Going back to the subject of chess, one calculation suggests that there are 10120 possible game variations despite the boundaries imposed by the board and rules. So is it really all that daring to suppose that there may be more than two or three ways to effectively execute a given operations activity? Advances in information processing and communications capabilities have altered middle- and back-office operating models before. Why should we think this new stage in technological evolution doesn't apply?

Role definitions, operating procedures and service provider strategies should all be subjected to a "5 whys" exercise: Ask why something is done a certain way and then ask why the answer is what it is four times. I am relatively sure that phrases such as "too hard," "too complicated," "too costly" and "systems can’t support it" will come up more than once. When those phrases do come up, take a step back and ask another series of questions:

  • What would happen if you had a means of getting to the people who might have answers more quickly?
  • What would happen if everyone else involved in a particular issue got the answer at the same time you did?
  • What would happen if the people had a way of being recognized for their contributions and the slackers had no place to hide?
The answers to these questions will provide the foundation for your pilots.

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