The future of banking and the adoption of the blockchain
The potential of blockchain is now only emerging; in its simplest form as an open, secure and efficient way of managing and recording transactions.
Digital Transformation and the blockchain:
The rise of digital transformation is not only about moving businesses to the ‘digital world’ but also about how they learn, interact and satisfy customers daily. The shift away from legacy systems and the increasing use of cloud technology is causing financial service enterprises to adopt Cloud technology and keep up with the rate of innovation within the industry.
The comparisons between the rise of digital transformation within a business and the rise of blockchain technology are strikingly similar. Both are being met with starting trepidation, however, the move to an ‘omni-channel approach’ is something that will not only save cost, time and will-power but most importantly transform the industry towards the innovation and change that it needs.
The technology behind the blockchain combines the openness of the internet with the security of cryptography to give consumers and companies faster ways to verify key information. The potential of blockchain is now only emerging; in its simplest form as an open, secure and efficient way of managing and recording transactions. The reason many financial institutions choose not to implement such technology is due to the size of the task. In a recent report by Gartner, it was said that “Exploiting blockchain technologies to the fullest extent will require enterprises to creatively deconstruct current business models” (Gartner, Predicts 2018: Top Predictions in Blockchain Business, 10 November 2017). A comparison can be made with the rejection of digital transformation, with many institutions preferring the legacy systems that are already in place.
A lot like blockchain technology, digital transformation is attempting to rebuild the systems that institutions use. This is one of the reasons why such large financial institutions have not adopted such technology as once again, the task is a large one. However, the breaking down of the silos within a system and placing it all onto one solution would create an ‘omni-channel’ experience for the business and customer. Through Microsoft Dynamics 365 we empower a single view of the customer, a 360-degree view of both the business and customer at any time, across devices and the enterprise.
Blockchain and Digital Transformation
The benefits of applying both to industries are similar. They would both create an efficient and systematic plan of action that would allow for a solution that would save money, attract and retain customers and help better manage risk. The goal would be to save costs and protect margins, whilst enhancing productivity via collaboration. CIO’s must drive blockchain technologies into areas where the technology recognizes differentiated value. Achieve the right balance by recognizing that blockchain is not a panacea, meanwhile ensuring that you do not miss out on any transformative opportunities. Gartner has predicted that “by 2022, more than a billion people will have some data about them stored on a blockchain, but may not be aware of it”
(Gartner, Predicts 2018: Top Predictions in Blockchain Business, 10 November 2017).
The comparison of both the benefits and the outcomes of applying both blockchain technology and digital transformation to financial institutions are almost symbiotic. With digital transformation, we can assist financial institutions in developing bespoke cloud capabilities to improve workflow performance, personalize B2C integration and maintain a competitive advantage in a highly demanding market. We reconstruct, replace and renew administrative systems to allow for integrated and streamlined channels throughout the organization.
By aligning with your strategic priorities to sustain and grow your business, utilizing a digital culture where Microsoft Dynamics 365 will break down the silos and provide a 360-degree view of your customer interactions. This market shift is happening now because along with reducing infrastructure costs and internal operating costs, cloud-based platforms are mature enough to meet ongoing demands. The similarities with the blockchain are apparent and the time for organizations to adopt such technologies is upon us. Just recently we saw the news that Santander became one of the first banks to apply blockchain to a newly released payments app, enabling customers to make international payments 24 hours a day, clearing the next day. It’s only the first step, but blockchain will eventually enable banks to provide real-time payments whilst reducing operational costs, human error and fraud. Questions? Reach out to us here.