Bankers are no longer thinking about whether to build new and better ways of doing business; rather they are puzzling over exactly how to do so.

A lot of projects so far have been about keeping up with customer expectations. But at most that just helps maintain value. Going beyond that is essential to gain a competitive advantage and create value.

So as the industry undergoes a digital transformation — and fintech challengers encroach — make choices about where and how your bank can best compete in this evolving ecosystem, then invest accordingly. The point is to create a digital strategy that fuels shareholder equity, said John Lester, a partner at Oliver Wyman and co-author of a new report that addresses this topic.

"I think the real question CEOs should be asking, and I'm sure are beginning to be asked is, 'What is the value we're getting from all of these digital initiatives?' And I think for too many incumbents, the answer is, 'Not a lot so far,' " Lester said in a video discussing the report. "What we're exploring is a way to reorganize and rethink the way you do digital transformation so that you actually drive towards value directly, in a systematic way."

Digitizing all aspects of the businesses generally results in spending a lot and doing nothing really well. Instead, the report, titled "The State of the Financial Services Industry 2017: Transforming for Future Value," suggests picking one of three business models as a way to help define goals and choose technology best suited to add value.

In the first model, "demand aggregators" provide a frictionless experience that helps customers with all aspects of filling a particular need, like buying a car. This might entail partnering with other providers to offer services the bank doesn't.

The report cites USAA's Auto Circle as an example. Over the past five years, USAA went from simply providing auto finance and insurance to assisting customers through the entire car-shopping process. It partnered with the comparison website TrueCar to allow customers to shop for and purchase cars online.

Car shoppers spend most of their time deciding what to buy, then often take whatever loan the dealer offers during the purchase. By inserting itself into the process as customers compare cars, and offering financing and insurance options in real time, USAA set itself up as a preferred provider, the report said. Since the launch of Auto Circle, USAA's penetration of its customer base for auto loans has more than doubled.

In the second model, "platform providers" that already process massive amounts of transactions leverage those capabilities on behalf of other companies. Platform providers earn fees, so the more interactions they facilitate between customers and product providers, the better.

The report listed Uber, Airbnb and eBay as examples. Within the financial services sector, payments networks and stock exchanges are both platform providers.

A lesser-known example that the report cited is Goldman Sachs' Marquee platform, which launched in 2013 to provide access to the global investment bank's proprietary analytics. In particular, a structured debt instruments marketplace called SIMON connects brokers seeking debt solutions with banks that issue them.

Offering competitors' products through SIMON might seem risky, but the strategy has been paying off, with Goldman rising from fourth to first in structured note issuance over the last three years, according to the report.

In the third model, "component suppliers" focus on being the best in what they offer. They invest in consumer insight to design new products and retool existing ones, and plug into as many potential customer experiences as possible, including nontraditional ones, the report said. Low cost, low cycle time and specialized expertise are all important here. is one example. It offers automated plug-and-play sales and marketing tools via the cloud and incorporates established technology, including Amazon Web Services, Slack and Microsoft's email platform, the report said. As such it covers the whole sales and marketing spectrum, rather than just one component, making it more compelling.

Strategic approach aside, going digital is essential to serving millennials, who are less likely to adopt current products, and less likely to acquire products through established distribution models, the report warned.

But regardless of target audience, the key is to focus on providing value to people's lives, rather than getting caught up in the next big technology craze. And choosing where to invest starts with knowing your own value proposition.

Bonnie McGeer

Bonnie McGeer is the executive editor of American Banker. She oversees its monthly magazine and chairs the Most Powerful Women in Banking and Finance program.

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