October 29, 2020 | Karen Kislin
The International Monetary Fund (IMF) recently downgraded its global economic growth predictions for 2021 due to the deeper, negative impact COVID-19 has had during the first half of 2020, as well as the slower recovery rate in the second half of this year as previously predicted. In the report, the IMF emphasized how abnormally large the uncertainties surrounding their predictions are due to the lack of clarity regarding the health crisis.
This level of economic uncertainty complicates strategic planning for financial industry leaders, as well as intensifies the importance of strategic planning. Financial institutions must constantly challenge their paradigm about financial performance, customer or member service satisfaction, and the market position they have attained. The strategic planning process provides that opportunity.
The key strategic initiatives financial institutions should consider for 2021 fit within the three pillars of their brand: employees, accountholders and market. Successful strategic initiatives should align with your mission, which defines the purpose for your organization and employees, and your brand is the epitome of your mission. When you align your initiatives and culture with your mission, you are able to deliver authentically on your brand.
The most critical pillar of your brand is your employees; therefore, addressing workplace culture and how diversity and inclusion contribute to that culture should be the top priority. Additionally, expanding employee skillsets is a critical strategic initiative as consumer expectations of service delivery have evolved. The more customers or members leverage digital service channels for daily transactions, the more the role of the branch must transform. Therefore, branch staff skillsets must fulfill a more universal role.
Over the course of pandemic stay-at-home orders, consumers have embraced the ease and convenience of e-commerce and digital banking capabilities. As they experience various service industry digital offerings, consumer expectations of the financial industry’s digital service have reached new heights. Technology that was offered in the recent past may no longer meet existing expectations; therefore, other key objectives to address during strategic planning include simplifying service delivery channels, enhancing digital offerings and investing in scalable technology.
All products should be examined to see if the process, both internal and external, can be improved. Financial institutions should consider all channels, including payment technologies and mobile wallets, as part of the accountholder experience. The easier your tools and processes are, the more your customers or members will likely think of you first when needing additional financial products.
Small businesses have been devastated by the impact of the pandemic. Whether they can come back plays a significant role in the level of uncertainty regarding economic growth. Financial institutions should evaluate your community focus and identify opportunities to further cement your institution as the financial institution of choice in the community you serve. A key strategic initiative for 2021 is reviewing how your bank or credit union might further support the recovery of small businesses. Their success leads to new employment opportunities, which fuels the economic strength of your community.
Your own organization’s growth is paramount to achieving sustainable success. The way your market perceives your brand is critical to your ability to attract new customers or members. Addressing your market strengths and opportunities is a key strategic initiative. Growth by merger and acquisition is also a critical initiative to consider. Proactively organize guidelines to help make quick decisions on whether a particular merger opportunity is appropriate.
To succeed in this environment, financial institutions need to leverage the strategic planning opportunity to prioritize key objectives with quantifiable measurements. When you align your initiatives with your mission, you can deliver authentically on your brand promise. Also, leaders can direct the entire organization to support enterprise-wide objectives and hold people accountable. When the strategic objectives are clear, measurable and transparent to the entire organization, you will gain more buy-in from employees while reinvigorating their motivation toward your mission and achieve stronger results in the year to come.
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