Bank Structures Change as They Embrace Technology
By Michael L. Stevens
CSBS Senior Executive Vice President
Community banks are making structural changes as they fully embrace technology solutions. As technology solutions have become mission critical, technology-related roles are less likely to be a piece of someone’s job. Instead, they fall under officer titles such as “Innovation Officer” and “Chief Technology Officer.”
That’s one takeaway from our most recent community bank case study competition. CSBS has sponsored it for four years, asking undergraduate students to partner with a community bank to explore a key issue. The 2018 case study competition focused on banks use of technology, with a record 51 participating teams from 45 academic institutions in 24 states.
The case studies provide valuable insights into how banks are viewing technology in their operations, customer service and retention, new products and disaster recovery. As you would expect, you get the full range from excitement and renewal to frustration and anxiety. But make no mistake, community banks are all in when it comes to technology.
The technology-related positions are rising in the organizational chart with more responsibility and influence in the organization. It is hard to imagine that future community bank CEO’s won’t continue to come from the credit or finance part of the bank, but it probably won’t be long.
Banks are forming cross-functional committees to evaluate technology solutions, select vendors and determine which projects go forward.
Board oversight over the technology strategy and vendor management program has had to increase. Board members with a technology background and experience are a critical voice to have in the board room.
The core business of banking is the same. The way banks conduct the business and engage with their customers is changing rapidly. Community banks are realizing their staffing, structure and governance must change as well.