Digital fluency—being able to use digital tools and technologies to create something new—is a business imperative for banks. Andy Young explains why.

Which musical artist has had the longest-running streak at the top of the Billboard Hot 100 list? If you guessed The Beatles, Madonna or Prince, guess again. The answer: Lil Nas X. The singer-rapper holds the record with “Old Town Road.” If you’ve heard the song, you’ll curse me for getting it stuck in your head. If you haven’t, consider yourself lucky, because it’s a serious earworm.

What I find fascinating isn’t the song’s commercial success, but its origin story. It’s a country-rap song, based off a “beat” purchased off a digital marketplace. That beat was made by a Dutch record producer who sampled the industrial rock band Nine Inch Nails. Lil Nas X recorded the song in one day, then uploaded it to Soundcloud. He spent a few months creating and tweaking memes on TikTok until one took off. Cue a record deal, remixes with Billy Ray Cyrus and Korean phenoms BTS, and 17 weeks at the top of the Hot 100 chart.

Digital has fundamentally changed the world.

What on earth does this have to do with banking? Everything. Digital has fundamentally changed the world. It breaks down traditional value chains, removes historical boundaries and creates entirely new ones. It changes the way that banks interact with their customers—and how customers expect to interact with their banks. It enables circles on a Venn diagram to overlap where they never did before. It enables innovation and creativity that we can’t even imagine yet.

What is digital fluency?

Digital fluency was important before the pandemic, and it’s even more important now. But let’s start with the obvious question: what is digital fluency?

When we learn a new language, being literate means understanding the basic tools of the language: being able to read and write. Fluency, on the other hand, means having synthesized those tools and being able to use them to create something new. It’s the difference between being able to read a road sign and being able to write a poem. It’s the difference between understanding a concept and being able to extract knowledge or insights, connect disparate ideas, and innovate.

Digital fluency means the ability to not just be able to use digital tools and technologies, but to be able to use them to create something new.

Our research has found that digital fluency can enable business performance. For example, compared to their peers, digitally fluent companies are 2.7 times more likely to have experienced high revenue growth (of 20 percent or more) over the past 3 years, and 5.4 times more likely to still be projecting high revenue growth over the next 3 years.

What’s more, digitally fluent companies win with customers and employees: 69 percent are considered a great place to work by their people, and 68 percent lead their peers in customer satisfaction. Digitally fluent companies also lead their peers in innovation (62 percent) and operational efficiency (61 percent).

Despite this, the 2020 Accenture Global Digital Fluency Study shows that just 14 percent of companies are digitally mature.

And it’s crucial to distinguish between offering digital services and being digitally fluent. For example, our Banking Consumer Study found that the pandemic rush to provide digital services is depriving banking of its traditional human touch, which exacerbates the risk that banking services will becoming commoditized. As we’ll see, digital fluency goes far beyond self-service banking tools.

Digital fluency is an imperative for banks’ business survival

What kind of business is a bank? If we take your clients’ money out of the equation, banks are technology, data and people companies. In that context, the need for digital fluency becomes clear. It’s imperative for your bank’s business survival.

Within banks, work has evolved so rapidly that digital fluency is a must-have, even in banking jobs that didn’t used to require it. Customers expect personalized and relevant experiences to an extent they didn’t used to. Banks also face pressure from fintechs and neobanks. Incumbent banks can’t just be the most convenient or established option; they have to be the most relevant, chosen option.

What does that mean for your bank? Let’s think of this in two timelines.

First, there’s the near- and short-term, in which banks are adapting to a distributed workforce and perhaps planning for a hybrid workforce that mixes in-person and distributed work. To make either of those work, basic digital literacy is important—as is the provision of digital solutions that actually enable people to work effectively, rather than adding tools on top of tools (a phenomenon that Accenture calls tech-clash).

Second, fluency is required for the long term. One bright spot to the pandemic was that for many companies, it meant taking their 18-month plans for digital transformation and achieving them within weeks. That pace of change is only sustainable if you bring people along with you, because it’s their use of the technology that sparks the innovation and creativity that creates a definitive competitive advantage. And that means equipping people with the skills, culture and processes that they need to use technologies—like AI, cloud, blockchain—to innovate.

Digital fluency is important in the short term as an enabler of people’s day-to-day work—and in the long term to support creative, innovative thinking that drives your organization forward.

Finally, the onus for digital fluency falls on your bank, not on your people. I touched on this in my discussion of an organization’s responsibility for leaving its people Net Better Off. Here are five sweet spot practices to help you get the most ROI for your efforts.

Digital fluency for now: Remote work and hybrid work

COVID-19 caused a sudden shift to remote work that stress-tested business continuity planning like never before.

Our research shows that across industries, more than 60 percent of the global workforce is working remotely. When we surveyed FS C-suite officers in the US about their shift to remote work, the vast majority (99 percent) reported they implemented remote work in some form.

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However, the gap between CIO/COO and CHRO responses highlights the disconnect between being technologically prepared for remote work and being culturally prepared. Most banking and capital markets firms were prepared from a technology standpoint, but roughly half were not prepared from a cultural perspective. In other words: digital fluency is about tech and people, not either/or.

In addition, we asked more than 5,000 workers across the globe about working during COVID-19. In banking and capital markets, 18 percent said they worked remotely before the pandemic; during the pandemic, this rose to 80 percent. However, when we asked what proportion of the time they wanted to work remotely, they said 43 percent.

As the pandemic continues and banks look to reopen in some form, it’s not just about being able to work remotely—it’s about being able to work well remotely.

In other words, remote work is not going away anytime soon. So digital fluency is essential for banks to continue to support a distributed workforce.

Digital fluency for the future: True transformation

There’s clearly a short-term, tactical need for digital fluency. But digital fluency is also the lynchpin to unlocking long-term benefits for your bank. It enables agility—which, as the pandemic has shown, is key to being able to respond to change.

Accenture research has uncovered a four-part digital fluency framework that predicts 54 percent of a worker’s ability to be agile.

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When we talk about digital transformation, technology tends to dominate the conversation—but tech is only one piece of this framework. The other three parts—skills, operations and culture—are the other parts of the puzzle. And crucially, when transformation fails, it’s typically not because of faults in technology or its deployment, but in one of the other three dimensions.

For banks in particular, it means having a new mindset, of moving away from seeing tech as the purview of the IT department or a matter of just changing processes. It means:

  • Moving toward a transformation mindset that it starts at the Board level and goes throughout the organization
  • Innovating to find new business models, a broader ecosystem, new value propositions and more effective experiences that provide customers more value
  • Shifting away from long-cycle transformation programs and embracing iterative, rapid-ROI programs that can sense and respond at scale
  • Embracing a more open perspective on technology-led competition and collaboration, rather than holding to a bank fortress mentality

Turn the change into a game changer

Digital fluency is about a bank’s overall readiness for constant change and market preparedness. We saw this in the early days of COVID, as digitally ready companies fared the best in the transition to a distributed workforce. Digital fluency is also about making specific changes within your organization, to look at how you’re new-skilling people between roles or into entirely new roles. And digital fluency is linked to competitive agility, which is more and more important as disruption increases.

Banks have fared reasonably well during the pandemic, but to sustain business performance, digital fluency is essential to not just lift the workforce—but to change it.

“We quickly uplifted all the same technologies, processes and ways of working into the home without actually reimagining the work experience. New technologies and new ways of leading and working are required if we are to sustain this shift in the long run.” –People experience officer

It’s up to banks to create the right environment and culture for learning and digital fluency. In my next post, I’ll look at how to hone your bank’s digital fluency.

To learn more about how to improve your workforce’s digital fluency, contact me or reach out on Twitter at @andyyoungACN.

Many thanks to Eva Sage-Gavin, Emma McGuigan and David Shaw for your leadership, and Kelly Monahan, Ph.D. for leading the research study.