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What are you willing to do to win?

What are you willing to do to capture your ROI? When you decide to move forward with a technology you are committing to an upfront cost plus ongoing costs with the hopes of capturing new revenue, reducing operational costs, or avoiding some other losses like customer churn. But that’s not enough if you want to maximize the return on your investment. 

 

In the early days of Alloy Labs, we focused on helping banks improve their technology adoption strategies to accelerate their digital transformation. The biggest barrier was the sourcing approach. The longstanding RFP processes were inefficient, requiring tremendous resources from banks to manage over long periods of time. They were also ineffective, failing to identify the best solutions for the banks and most importantly, their customers. The high operational cost combined with the low-quality output created low ROI initiatives; and therefore, perpetuated a reluctance to invest in digital transformation.  



A group of employees reviewing files on a table.
You won't find hidden ROI by overanalyzing spreadsheets.

Alloy Labs member banks, today, are much better at sourcing solutions to solve their needs. They approach each problem and opportunity with a greater focus on customers by understanding their problems, forming hypotheses, and conducting experiments. Our member banks now run accelerated evaluation processes that prioritize the elements that drive success, while managing the risks that can doom a project with more progressive strategies. By improving their partner evaluation agility and quality, our banks have positioned themselves to achieve stronger ROIs with more tech partners. 

 

There are many ways to get better at generating a return on your tech investments. Let’s recount them: 

 

Step 1: Increase your hit rate: Don’t commit to and waste resources on bad solutions.  


✅ By performing experiments that test our customer hypotheses, we find what customers are more likely to use, and get more confidence when selecting solutions. More effort spent validating the customer desirability leads to banks hitting on more of their investments and having fewer projects fail. Fewer failures is a great way to move the needle. 

 

Step 2: Decrease the investment: Improve the process efficiency. 

 

✅ Get through the process faster. Focus on the questions that matter rather than every possible question that could be asked. Utilize the plethora of resources at your disposal (like leaning on your Alloy Labs peers!) to learn more, faster. 

 

Step 3: Lean into your winners: Maximize the value from your best investments. 


❌ Step 3 is where banks will achieve the next step change in the return on their technology projects. To do so, banks must invest more time in their technology AFTER it’s been pushed live. 

 

Great technology products grow into their customer bases; they aren’t great right out of the box. They morph as they capture wider segments. They reinforce their value to existing customers with new features that enrich its offering. They improve acquisition funnels, growth drivers, targeting, messaging, everything. They embed themselves in other parts of our lives.  

 

Banks aren’t structured to build great products though. 

 

Tech implementations are hard. Projects are long and require an incredible amount of resources, attention from the innovation group, business unit leaders, steering committees, and, of course, risk and compliance. If any change triggers a new project, the bank will be much less excited to invest versus harvesting the existing success and investing in other areas. And to that point… 

 

Roadmaps are long. The technology gap between your average community bank and a fintech or large bank is vast and increasing. Even the banks with aggressive technology strategies have long product roadmaps to tackle. Once a project is complete, they must begin preparing for the next one. 

 

No one is managing the product. Product managers still don’t exist in banking at scale, and when you do find them, they are more likely to oversee banking products, not digital products. Product managers drive the iterations that allow products to become great. When a solution is deployed, it becomes owned by the business unit, which is typically made up of relationship managers, underwriters, and other bankers in charge of supporting their customers. After the product goes live, no one is managing it and trying to maximize its value. 

 

Banks are in the lending business, so it’s easy for them to understand the importance of minimizing losses and increasing efficiency. The next stage of their development will come when they act more like technologists and maximize their winning investments too.  

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