However, they also are facing difficulties: Customers move fluidly between products and channels, yet most FSIs are not organized to address this new behavior, with nearly all companies organized by product and 60% housing separate digital and marketing functions, according to internal research by Adobe’s Digital Strategy Group. To deliver personalized experiences that place customers—not products or channels—at the center, companies must adapt their structures for new digital capabilities, collaboration, and agility.
We identified three organizational structures that can effectively address these goals: centers of excellence (COEs), customer journey teams, and agile marketing teams, with the ultimate vision of integrating all three components. Each one requires increasing levels of digital maturity to be successful and comes with its own set of challenges and opportunities. Yet, if implemented successfully, companies are empowered to deliver the experiences that customers crave, and they reap the rewards of improved efficiency, retention, and customer satisfaction.
1. Centers Of Excellence
COEs, the most common of the three structural elements, are effective in developing digital capabilities. A COE is a concentrated team of subject matter experts who execute a specific capability and build expertise throughout the organization. This helps reduce redundancy, align initiatives, and enable teams in a unified effort. A COE’s mandate can range from broadly digital to more specific functions (e.g., personalization).
COEs have a maturity lifecycle, beginning as a centralized COE and evolving into a governance COE. Centralized COEs both develop and execute strategy to introduce new capabilities in an organized manner. For a smooth adoption, centralized COEs should clearly define KPIs, responsibilities, and workflows to ensure alignment. One retail bank we work with uses a DACI model (a framework indicating who drives, approves, contributes, and is informed for different activities) to establish how the COE works with the rest of the company, especially with key stakeholders such as compliance.
As the centralized COE’s capability begins to scale and the demand for more sophisticated capabilities grows, it can no longer own execution without hindering speed. The centralized COE then transitions to a governance COE, responsible for best practices, standards, and empowering business units to execute. Without direct influence over execution, it is important that governance COEs invest in high-touch relationships with business units to better understand their needs and set the right expectations. For example, a global financial services company we work with allows its business units to fund its global governance COE. By nature of this transaction, the relationship and expectations of the business unit for the COE are clearly delineated.
2. Customer Journey Teams
Once digital capabilities are developed, more mature banks are leveraging customer journey teams to move toward customer-centricity. Customer journey teams are responsible for orchestrating the end-to-end journey for a key audience (e.g., SMB customer) across channels. By embedding the journey within their structure, companies place customers, not channels, at the heart of their operations and create accountability for delivering a unified experience.
Customer journey teams in most companies fall into two categories: intelligence and execution. Cross-journey intelligence teams surface insights across the journey and share them with relevant teams. Cross-journey execution teams go one step further by also owning the cross-channel activation of these insights.
By embedding the journey within their structure, companies place customers, not channels, at the heart of their operations and create accountability for delivering a unified experience. For example, one retail bank’s journey manager for the loans product identified that the mobile loan application had significantly higher friction than other channels and prioritized testing on this part of the experience. As a result, mobile loan applications increased by 20%. By having teams responsible for looking across the entire customer experience, companies are better able to prioritize activities, optimize resource allocation, and deliver a more holistic customer experience.
Customer journey teams must begin by implementing a robust, unified data service that is agreed on by all parties (channels, product teams, etc.). Cross-journey analysis leverages a variety of data, and without trust in these insights or the data that supports them, teams will find it difficult to effect change.
3. Agile Marketing Teams
Customers and their behaviors change fast, and many banks are feeling the frustrations of organizational silos (among creative, marketing, brand, IT, etc.), impacting speed to market, our research has found. To address this challenge, the most mature FSIs are expanding agile beyond IT and into their digital and marketing organizations. Agile marketing organizations have tribes with a specific digital goal (e.g., grow digital acquisitions) who create scrum teams to execute discrete projects toward that goal. Scrum team composition varies but typically includes a scrum master and individuals from digital marketing, analytics, IT, and compliance.
Due to the disruptive nature of implementing agile, companies should start with a pilot scrum team focused on a singular use case with measurable results. This allows companies to create a business case for transformation.
Agile marketing can have tremendous benefits, yet it is the most difficult structural element to adopt due to the disruption required across teams. Companies should have a strong foundation of data, marketing technology, and capabilities before investing in agile.
People And Process
It is important to remember that structure is only part of the solution and is ineffective without the right talent, controls, and processes. While each of the above structures require differing talent and processes for success, there are universal truths that span across all companies.
First, companies should not only invest in training employees in the technical skills required to execute digital initiatives, but also the digital concepts to understand the purpose of these initiatives. Formal training programs that balance these two topics can help employees be more strategic about their execution.
In addition, involving compliance early and often is critical. FSIs should educate compliance teams on digital marketing concepts and goals and arrange preapproval processes to increase speed. By involving compliance early in the conversation, digital marketing teams can build a partnership instead of face opposition.
In an increasingly digital-first world, FSIs must develop new ways of working to meet changing customer behaviors and expectations. When properly executed, COEs, customer journey teams, and agile marketing can help banks deliver enhanced capabilities, unified customer experiences, and improved speed to market.