ABA Banking Journal - September/October 2017 - 8
> CHAIRMAN'S VIEW
What Does the Tyrannosaurus Rex
Say to the Triceratops?
BY DOROTHY SAVARESE
NOTHING. THEY'RE BOTH LONG GONE. Dinosaurs. Video Rental stores.
Netflix. Each has been invoked in warnings to banks: Evolve. Disrupt or be disrupted.
Keep pace or experience a new kind of ice age moment-losing relevance.
Many bankers have been concerned
about the potential competitive
threat posed by the growth of fintech
companies. At the same time, more and
more fintech companies are seeking
partnerships with banks, as if they have
received their own quiet counsel: Don't
try to go it alone-banking's harder than
it looks. So is fintech a friend or foe?
For banks, understanding how to
navigate the rapidly changing world
of technology seems overwhelming
at times. Stepping back, I think the
most important rule is not to embrace
technology for technology's sake, but
to keep pace with it and anticipate
customers' wants and needs. That's
no small challenge, given the variety of
customers we serve.
A recent survey of consumers
conducted for ABA shows that bank
customers are not monolithically
leaving behind some channels, like
branches and ATMs, in favor of others,
like online and mobile. They are
consuming them all. As with so many
trends today, this poses both challenges
As an optimist, I like to focus on the
opportunities. When I started at the
Cape Cod Five Cents Savings Bank 24
years ago, I was a commercial lender.
I noticed that our customers were
changing in terms of their expectations,
so in 1998, I volunteered to coordinate
the rollout of our internet banking
ABA BANKING JOURNAL | SEPTEMBER/OCTOBER 2017
channel. We were the first Cape-based
bank to do so. It was, coincidentally, the
same year that iTunes was introduced in
limited release. This seems like a lifetime
ago in tech years.
Customers, their lives and expectations
continued to change, so I moved into
the role of change agent-a.k.a. the
director of product planning-and rolled
out a debit card, relationship package
and other innovations. Since then, our
product and delivery systems have
continued to evolve to accommodate
But as they say, past performance is
no guarantee of future results. Our
future success lies in providing the
sophisticated products and services our
customers need before our competitors
do. Yet the sheer volume and variety
of fintech opportunities leaves one
wondering: what should we do next?
New technologies are transforming every
part of banking, from lending and the
customer experience to payments, backoffice efficiencies and data mining. So
what is the best way to keep pace and
know you are implementing the right
technologies for your bank?
One way is to lean on your associations.
ABA helps keep bankers abreast of
innovations through resources like this
issue of the ABA Banking Journal and
other resources found at aba.com/
fintech and a host of Endorsed Solutions
from fintech companies that we have
vetted and declared best-in-class
solutions. These are great resources.
In addition, I think it is imperative to
adopt fundamentally new approaches
to running our banks. A good way to
keep up is by changing how we plan,
implement and manage risk. The
evolving needs of our customers take
center stage in planning. We have
reorganized our bank's strategic steering
committees based on the lean approach,
with technology integrated into each one.
We have recalibrated our risk appetite
in terms of innovation and technology.
When we made the decision to
implement the mortgage mobile solution,
there had been only 30 banks who had
signed up for the product. In other days,
we would have waited longer to see how
these deployments fared. Instead, we
realized we needed to move quickly or
risk being at the back of the line.
I mentioned earlier that we rolled out our
internet bank at the same time iTunes
was originally introduced. Within a few
years, iTunes became the dominant
player in the music market. Now, of
course, we have seen its market share
erode due to the disruption of streaming
music. The lesson there is that even
technologies that are on the upswing
now could soon be disrupted by new
innovations. The only constant with
technology is constant change. Get
comfortable with that and you're well
on your way to ensuring your bank's
ABA chairman DOROTHY SAVARESE is
chairman, president and CEO of Cape Cod Five
Cents Savings Bank, Orleans, Mass.