SunTrust operates a network of nearly 1,500 physical bank branches but, as its CIO Anil Cheriyan told me recently, “Very few people actually visit a bank branch. They need access to their financial information when they need it, whenever and however they need it. We are responding with a mobile-first, customer-first approach, providing a great digital experience.”
All businesses today are digital businesses. The customer’s digital experience paves the way to new revenue streams, provides a sandbox for experimenting with new ideas, reveals what customers want, and helps improve customers’ satisfaction and loyalty. When your business is born on the Web, your business is digital by definition. But when it has been around for a long time, the challenge is to embrace the new while reinforcing and reinvigorating existing strengths, skills, and processes that differentiate your business from the competition.
Adding a new digital layer to doing business is especially a challenge in an industry such as banking where everything used to revolve around face-to-face interactions conducted in a specific physical location. SunTrust traces its origins to 1891, when the Georgia General Assembly granted a charter for the Commercial Travelers' Savings Bank in Atlanta. Today, it is one of the largest banking organizations in the U.S. Under the leadership of William H. Rogers, Jr., CEO since June 2011, it has embarked on a new strategic thrust, focusing on three priorities: Optimizing the balance sheet and business mix; deepening customer relationships; and improving efficiency. Rogers has recruited new executives to his leadership team, among them Cheriyan, who joined SunTrust in 2012 after more than 25 years in IT consulting, most recently as the executive in charge of IBM’s insurance industry consulting practice.
“Within 60 days I was in front of the board, presenting the IT transformation needs,” Cheriyan told me. “It took another month or two to create the team that developed the roadmap and the transformation plan. It couldn’t be my plan, it needed to be my team’s plan,” added Cheriyan. Following the new strategic direction for the bank, the plan called for developing five main strategic capabilities across the bank’s operations and IT, the two areas Cheriyan leads. These include developing digital channels and analytics capabilities; making process and operations “variable,” so they can more easily adjust to the ups and downs of the business; developing shared componentry and shared services across the bank; and infrastructure refresh and modernization.
The development of these strategic capabilities and the progress along eleven “transformational tracks” derived from them supported Cheriyan’s overall goals of business alignment, effectiveness, and efficiency. “There was a pressing need for us to be innovative, but only in early 2013 I felt comfortable talking about innovation and that we had the right leadership to make that happen,” says Cheriyan. “The new story became, how can we accelerate, innovate, and renovate.”
Renovate? Yes, Cheriyan understands the downsides of extreme transformation: “Being a bank that has been around for many years, renovation became a big theme because the cost of decommissioning and creating something new. I wanted people to understand that it’s not like buying a new car – it needs to be thought through as part of the overall investment and budgeting and portfolio management. It’s great to accelerate and innovate, but you have to think about the base that you’ve got and how you can keep it. Most people forget about this simple thing, they just want to add the shiny new object onto their platform.” Recalling a team that called itself “Banking 5.0” and wanted to build everything new, Cheriyan says he told them “we are not going to do banking 5.0, we are going to do banking 2.0.”
To do banking 2.0, Cheriyan has instituted a number of creative ways to surface IT challenges and develop innovative solutions. First were “innovation hubs.” These are 2-hour virtual discussions to which everybody in the organization is invited. They start with Cheriyan throwing out an idea or an issue and have people comment and debate it. This turned out to be a great way to create a culture of sharing and challenging ideas and breaking down the barriers between different groups to encourage collaboration. “It allowed people to stick out their heads out of their little silos and look across the aisle and see who else was there,” says Cheriyan.
Then they took some of the ideas coming out of the innovation hubs and developed them further in “Innovation Fridays.” These are day-long, in-person events where they bring together the people who were most vocal in the innovation hubs and people from other groups, including the business teams, and try to develop together a solution. This accelerates the “time-to-market” of new IT applications, improves their quality, and ensures their success.
These and other new mechanisms for tapping people‘s creativity and drive collaboration resulted in a number of innovative initiatives at SunTrust. A good example is the “innovation branch” the bank opened earlier this year in Atlanta. The branch has ATMs outfitted with a monitor that allows customers to initiate a video call with a remote live teller when performing various transactions, including check cashing. Customers visiting the branch are also treated to a “Tablet Bar” and a guest Wi-Fi so they can test the bank’s mobile apps and an interactive 80-inch touch screen allowing them to learn more about SunTrust services. Another innovation is a fully automated safety deposit box system that allows customers to access their valuables using their debit card, pin number and hand scan.
SunTrust plans to open up additional innovation branches by the end of the year, including in grocery store locations, allowing the bank to test its new ideas in a completely different setting. “We are guessing what the client really wants,” says Cheriyan, “no one really knows where clients want to go.” Digital-native companies such as Google, Amazon and Facebook have perfected the practice of experimenting with new ideas, profiting from their online presence that allows for rapid testing and discovery of the real value of a new product and service to their customers. Now, companies in traditional businesses, such as SunTrust, are bringing this spirit of “let’s see what works and what doesn’t” to bear on the way they have served the customer for years. Doing this at the time when their customers are rapidly changing the way they interact with the bank, using all manner of digital channels and experimenting themselves with what’s best for their particular situations, requires a sandbox in which to provide customers new offerings, collect data, and analyze the results to understand better what should be implemented elsewhere and what shouldn’t.
I asked Cheriyan to compare his long career as a consultant to his work now as a CIO. “Putting all these ideas that you have in practice and seeing them in action is pretty exciting,” he says. “As a consultant you are doing a project for a client and here you are doing several projects for the same client. You can’t get away from what you’ve done, which is a good thing. And then you feel a sense of owning what you are doing.”
