By Kevin Tweddle
As community banks accelerate their innovation efforts, I continue to receive great questions from bankers across the country related to evaluation of potential solutions.
Since addressing strategic questions that guide internal innovation strategy are fundamental to any plan, here are a few key questions I often suggest bankers answer so they are in the best position to score a big win.
- What problem are you trying to solve? Focus on use cases that align with your strategy and make those your priority. This is part of the reason we launched the ICBA ThinkTECH Accelerator: to help community banks find providers to address some of their most pressing challenges.
- Who at your institution supports this innovation? If it’s not your CEO, COO and CFO—or your top three leaders—stop right there. Innovation needs to be woven into the unique strategy of the institution, with the top three executives leading the charge.
- Who is the project manager of this innovation? Once you’ve been given the green light, you’ll need someone with strong project management skills to lead the day-to-day implementation and dialogue and coordinate efforts with appropriate staff. The more diverse and collaborative the group, the better.
- How will you formalize your relationship with your vendor partner? One of your first steps should be to establish a legal agreement where both parties feel comfortable and have skin in the game. I know one bank that, as part of its agreement, made a small investment in a vendor’s company. It also committed to helping the partner resell the product to other banks if it lived up to its potential. Be creative, and make sure your partner is invested so it makes sense for all parties.
- How will you define return on investment? With innovation, ROI often is not about the bottom line. So, it’s important to develop a written explanation of why you’re doing it and how you’re going to evaluate impact. You want to start the project with a unified vision of success.
- Are you willing to fail? This may be the hardest one for all of us, but the answer needs to be “yes” before you proceed. Community bankers are Type A; fail is not in our vocabulary. But to truly innovate, we must be comfortable with not always coming out on top. Thomas Edison famously said, “I have not failed. I've just found 10,000 ways that won't work.” Let’s go with that.
Innovation is a tough nut to crack for any organization, but we need to push ourselves beyond our comfort zones and embrace the technologies that can help us meet our customer needs now and well into the future. Asking ourselves and honestly answering these questions gives us the framework to do just that.
Kevin Tweddle is chief operating officer for ICBA Services Network.