- Insider Intelligence spoke with Sathish Muthukrishnan, chief information, data, and digital officer at Ally Bank, about what “digital transformation” means at a digital-only bank.
- This Q&A is an excerpt from one of 15 interviews we conducted for our new report, The Banking Heads of Digital Report: 15 Leaders on Priorities, Challenges, and Opportunities.
- Do you work in the Financial Services industry? Get business insights on the latest tech innovations, market trends, and your competitors with data-driven research.
As an executive at a digital-only bank, Ally’s chief information, data, and digital officer, Sathish Muthukrishnan, didn’t have to guide his firm through a traditional digital transformation.
He’s nevertheless led his team at Ally through disruptive changes. He joined the company in January 2020, just before the COVID-19 pandemic wreaked havoc on US businesses—and upended customers’ usual habits of interacting with them.
“We could no longer predict that a customer was going to log in or trade between certain hours or shop for an auto loan once every two years,” Muthukrishnan said. “And the scale at which the customers were adapting to digital capabilities was also accelerating. We had to keep up with customer expectations.”
Tracking the behaviors of Ally’s customers and identifying their unmet needs is critical to the business’s continuous evolution.
“Technology is no longer the only key to transformation,” Muthukrishnan said. “There’s a human factor associated with it, rather than purely a technology play.”
Muthukrishnan is one of the executives Insider Intelligence recently spoke with to better understand how heads of digital define their roles and their place in the organization, the greatest challenges they face with digital transformation, and the priorities they’ve set for the future.
The following has been edited for brevity and clarity.
Insider Intelligence: Could you tell me a little bit about your professional background?
Sathish Muthukrishnan: I would call it my professional battleground instead of my professional background. I started off working for Singapore Airlines back in the ’90s, then moved to United Airlines and experienced the airline industry tank post-9/11. That’s when I got the offer from American Express. Then, in 2008 while I was working there, I experienced one of the greatest financial collapses in US history. So you can see why I’m calling it my professional battleground.
The financial crisis made us think about what the American Express of the future would look like. How can you go from asking customers to come to you, to going to where your customers are?
At that time, everybody was building a website and sending emails or snail mail asking customers to look at their brand. Instead, we focused on what we saw as the future of American Express—which is being embedded in what consumers were doing. And they were spending much of their time on smartphones and apps. So we partnered with Facebook, Foursquare, Twitter, Apple, and Samsung. And we built capabilities so that when customers were interacting in those channels, American Express became top of mind, and when payments were made, Amex was a popular choice.
[From there, Muthukrishnan worked on B2B and core operational initiatives at Honeywell Aerospace before moving to Ally.] Then, I got the opportunity to lead a digitally born-and-raised financial institution operating in multiple business models—B2B with our dealers, B2B2C with customers coming through the dealers to get auto loans, insurance, or extended warranties, and finally as a native digital bank with a B2C experience. I’ve been very happy with Ally.
II: Can you tell me more about how the end user’s experience and the IT infrastructure are related, and what’s really necessary to enable that experience—especially at Ally, which has a more modern front end?
SM: Technology is no longer the only key to transformation. The question you must ask is what truly transforms your business, similar to what we did at American Express—transforming the ways we were doing business and identifying new organic growth opportunities.
At Ally, if we modernize our core and make data available to our internal customers, our employees, then we’re modernizing the experience for our customers, too. There’s a human factor associated with it, rather than purely a technology play.
As an example, if a consumer is calling in, can we provide insight to our customer service representative—based on what we know about the consumer and learn from their tone of voice—so they can handle the conversation better than somebody who’s interacting with the person one-on-one physically?
Here’s another example. During the COVID-19 pandemic, we introduced our customer assistance bot. We created a bot using the subject matter of the highest volume of calls into our customer service reps: “What are your CD rates? Can you tell me where my direct deposit is going?” And if the bot can’t handle it, we transfer the call to a live agent while providing context. That frees up our customer service reps to work on more complicated problems, as opposed to answering questions that a bot could handle.
Like what you’re reading? Click here to learn more about Insider Intelligence’s leading Financial Services research.
II: If you were to write a short job description for yourself as chief digital, data, and information officer, what would you say?
SM: Let’s look at my title, chief information, data, and digital officer, and break it down. Each component within it reports to me.
One part is product design. Another adds the human factor by creating a user experience for the product design. Then there’s data, ranging from data management and governance to analytics and AI. Then there’s security, application and technology development, engineering, if you will, and finally network and operations. Anybody with any of those responsibilities is accountable for delivering for the business.
II: How close is the head of digital to the customer?
SM: Part of my job is listening to the voice of the customer. We gather all the customer-related data and customer feedback and put it on a single platform, and I work with my data team to analyze and identify the common themes. We take those back to the businesses to influence what features are prioritized or what new products are introduced.
For example, customers told us, “I need the ability to rapidly move funds from my deposit to my investment account so I can start investing.” The data told us lots of people were doing the same thing. We said, “Let’s create a one-click experience that lets you move your money from deposit to investment so you can start trading immediately.”
At the same time, we could also show the voice of the customer data to the marketing team and say, “Here’s where we’re seeing drop-offs when you’re marketing to prospects or cross-selling.” The marketing team works with my technology team to understand and refine their journeys or their marketing strategies.
II: What kind of challenges have you faced over the past year or two, and how have you handled them?
SM: I often say that when employees moved to working from home, we created 10,000 branch offices overnight—because that’s how many employees we had. Ally’s culture depended on people working together on location, so about 50% of them had never worked from home and another 25% rarely worked from home. We had to make sure that they got up to speed quickly and remained productive.
Another challenge was understanding the behavior of our customers. We could no longer predict that a customer was going to log in or trade between certain hours or shop for an auto loan once every two years. And the scale at which the customers were adapting to digital capabilities was also accelerating. We had to keep up with customer expectations.
We also had to stay on top of changing market conditions. For example, we were rolling out extensions for auto loans and home mortgages, and we expected a lot of uptake. We decided to alleviate strain on our customer service centers by creating a digital experience. For that, we had to be able to do contract rewrites end-to-end digitally. The team took up the challenge and rolled it out in just a few weeks. A customer requesting a loan deferral could log in and go through the contract 100% digitally, without interfacing or interacting with a person.
II: What does Ally look like five years from now?
SM: As a digital organization, we have the opportunity to treat every customer as if they are our only customer. I call it “the segment of one.” Essentially, we’re creating a consistent context and content for our customers, regardless of the channels they choose for interacting with Ally, whether it is their mobile phone, voice response, or our website.
We also have to keep looking around the corner to see where technology is going. We’ve hired our first quantum physicist, and we’re partnering with companies like Microsoft to build out a use case that will effectively leverage the computing power of a quantum computer.
II: Last question—what’s one piece of advice you would give to other heads of digital or CIOs?
SM: Cultivate the ability to operate at different heights. Think of the recent Virgin Galactic launch into space. The view from the top—which I would equate with strategy—gives you the big picture. But takeoff and landing are the most important aspects of a flight. If you can’t take off or land, you will never get that view from the top. You will never realize that strategy. So you need to learn to fly at multiple altitudes. You have to roll up your sleeves, work with your team, understand the struggles they’re going through, and help remove the roadblocks so they can bring to life the larger vision you’re seeing from a higher altitude.