Tuesday, April 7, 2015

Target Innovative Process and Business Models: An Example

If your organization does not target innovation in their processes that serve business products and services, someone else will. I certainly wouldn't want to answer to my executives when a competitor throws down the gauntlet with a threatening innovative process. I would much prefer to deliver additional revenue and satisfied customers. This example is one that Stessa B. Cohen of Gartner has documented for the mortgage loan arena for banks and other financial services organizations. It is a great example of a target model for a digital transformation and gets the creative juices flowing as it challenges the mortgage loan industry to think beyond just gather loan information, underwriting and servicing loans from a organizational perspective. Let's start with a picture from Gartner.



















Innovative Business Process:

When searching for a home, banks are not helpful at all. Imagine driving through your favorite area and snapping a picture of your dream home at the moment. Then having your bank pre-qualify you for a loan by aggregating your financial information and suggest a loan amount and alternative houses of a similar type in a similar or same sub-division based on your priorities.When a new property hits the market that meets your home requirements profile, you are notified. Now that's a mortgage process that pleases clients. Instead of starting at the traditional steps 6,7&8 that are rather limited but not loyalty minded, this model considers the customer journey from their perspective.
Is this model realistic, you ask?  The answer is "YES" as a failing bank in the UK bailed itself out during the recent recession with this new and innovative model. Watch out competitors !!!!

Digital Impacts:

This approach demands a social, mobile cloud approach for the first mile. This approach requires a big data pool that analyzes the customers needs and rules for engagement. It also notes emerging market events and bring them to the potential buyers attention. After the offer, then the traditional jet underwriting, case management, e-signature and document management kicks in as expected. Imagine that bank instrumenting the home for water, vapor, fire and break-in events to protect their investment and having the IoT notifying interested parties?

Net; Net: 

Who will put you out of business with innovative processes while you sleep at the switch?