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Execution Biggest Mobile Bank Challenge

2010 October 25
Mobile Risk Management

It's more risky to NOT take risks on mobile banking & remote deposit Photo: (c) ColdCut

As a consultant, I see inside a lot of organizations. Increasingly mobile is the competitive battleground for customers and revenue. Mobile is critical in a number of industries like retail, health care, and insurance; but, mobile banking is shaping up to be an especially dangerous battleground.

As banks roll out mobile banking and other mobile innovations, like mobile payments and mobile remote deposit capture, the ability to execute strategic plans is becoming the key difference between offerings. There’s not a creativity or enthusiasm gap between banks. Often there isn’t even a budget gap. The difference is in getting the job done.

Since the advent of online banking, banks have developed detailed formal processes for development, testing, and risk management. Organizations have blossomed even in relatively small banks and credit unions. So now, many institutions find themselves unable to implement even modest mobile projects in a matter of months. The sheer number of organizations involved cause implementations to be measured in fractions of a year rather than weeks.

Mobile banking is also uncharted territory for lawyers, risk managers, and information security. It’s far safer to stall or say no than to approve unfamiliar projects, despite a compelling business case. Sometimes even competing lines of business inject themselves into the process. Perhaps it’s cynical, but it seems groups want to ensure they’re associated with the high-profile success of mobile, or they want to disrupt what they perceive as foolishness. Either way, the process gets slower and slower and time-to-market gets longer and longer as each group piles on.

I cannot overstate the amount of gridlock I’ve seen in organizations.

Executives (this is you, CEO) must change their culture. Risk should be managed and process should keep groups organized, but they should not stop projects with compelling business cases if the benefits outweigh the risk.

CEOs should earn their hefty pay from making decisions like this.

The irony is that the gridlock caused by risk and process creates more risk than it removes. Gridlocked companies risk getting passed by their more nimble competitors. USAA and PayPal are two examples of more nimble companies getting something done and attracting customers from their competitors.

Business is about taking calculated risks to serve customers better. So do it.

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