Independent Banker - February 2023 - 31

PORTFOLIO
Here are three key areas where
digital twins could help banks:
4 steps to implement digital twin technology
1. Increased profitability
and growth
As online options proliferate,
traditional banks are often up
against tools and platforms that
are faster, cheaper and easier for
consumers to use. To avoid the
commoditization of the products
and services they provide, many
banks have placed an emphasis
on personalization and hightouch
service.
Digital twins of customers are
already occurring in a way, as
consumers continue to live their
lives online through social media.
Combined with bank data, a
financial institution can paint
a fairly full picture of customer
behavior and needs. By collating
that information into a model,
banks could beat a faster path
to profitability. They can quickly
bring to market new products
and services, using the digital
twin to tailor the offering, test
out messaging and deliver to the
right channels.
2. Sustainability goals
ESG (environmental, social and
governance) frameworks are hot
topics, but actually instituting
processes to meet ESG goals
is another matter. Digital
twinning offers a way to assess
the potential for sustainability,
providing banks with a tool to
make informed decisions and
evaluate environmental impact.
For example, a digital twin could
generate comparative data to
help plan out branch locations.
It could help banks measure
the environmental impacts and
associated costs of building a new
branch, versus repurposing and
retrofitting an existing building.
As with any new technology, there are challenges to rolling out the
concepts and processes involved in a digital twin simulation. Be
sure to take these steps first.
data you collect, and educate
your leadership and board of
directors to get their buy-in.
1
2
Increase your
security. A digital twin
is a cross-functional
tool, and as such, it touches
various systems. This can create
vulnerabilities; if a digital twin
is compromised, it can open up
access to sensitive data. Make
sure your systems are protected
before you begin.
Develop a clear
vision for what you
want to do with the
3
Upgrade technology.
A robust digital
infrastructure is
necessary to allow digital twins
to connect and communicate
with your systems, including
legacy tech, API integrations,
cloud computing and more.
4
Develop your team's
cross-functional skill
set. Time to break
down the silos! For digital twin
technology to be effective,
collaboration is key.
3. Operational efficiency
Good resource management is a
constant organizational goal for
any business, and current and
impending economic conditions
are making it more important
than ever for banks to do more
with less.
Develop and conduct
tabletop exercises virtually
to gain data before testing in
a real-world environment;
analyze business continuity
plan results in various
scenarios
Creating a digital twin to
mirror complex processes can
provide valuable data that could
supercharge the risk management
process for banks, generating
information to create efficiencies
in the following areas:
 Compliance: Streamline
repeatable processes and
manual work; formulate
potential responses to
regulatory changes
 Business continuity:
 Cybersecurity: Mimic
hacker behavior and collect
data that can help predict
criminal tactics; rehearse
cyberattacks to refine
incident response plans
 Resource management:
Simulate and compare
workforce models, such
as on-site, hybrid or fully
remote, to visualize how
they would work in terms of
costs, communication and
productivity
30 // ICBA Independent Banker // February 2023
Independent Banker - February 2023

Table of Contents for the Digital Edition of Independent Banker - February 2023
