Which industry faces the biggest challenges in relation to digital transformation?

There’s real trepidation around “extreme digitalization,” particularly in the banking industry. To remain competitive, banks are increasingly going beyond traditional bank offerings. Customers are no longer looking for a bank to provide exclusively financial services products; they are demanding more. As a result, banking has turned into more of a platform, with banks collaborating with a range of partners that can help them meet customers’ end-to-end needs.

Are you seeing new types of businesses turn to IBM Consulting?

At IBM, we’ve always worked with the world’s top medium and large traditional businesses in areas like core business operations, data and technology, and consulting services. However, we are beginning to see more customers in the fintech and startup space, like challenger and neobanks, automotive companies, and big retailer enterprises. It is interesting because these startups, despite being disruptors, are facing similar variations of the challenges we’ve historically seen with traditional industries. For instance, many fintechs that have recently hit unicorn status are facing fresh issues with regulators, where they now need to comply with similar compliance measures placed on medium and large banks. These are challenges many startups hadn’t factored in, so they’re turning to us to help them set up procedures and policies.

What’s next for industries as they continue to think about digital transformation?

Industries must start thinking beyond their own boundaries. The lines are blurring across many industries. Take Amazon as an example. It can no longer be classified under one industry. Today, it is a technology cloud services company, a retailer, and even a financial services provider.

Think of it this way. When someone buys a house, they aren’t just looking for a mortgage. They also want to know what shops are nearby, how safe it is, what schools are in the area, and how they will redecorate. We’re seeing more and more technology companies adapting to provide a similar ecosystem of services. If traditional companies restrict themselves to offering one piece of this puzzle, they’ll soon become irrelevant in the market.

What should companies be thinking about as they adapt to the increasingly integrated ecosystem?

For many years, bigger businesses have tended to opt for bespoke development of their software services. However, over time it’s become clear that this approach simply doesn’t make sense—it blocks innovation and usually comes at a significant cost, too. Software-as-a-service (SaaS) and cloud-based services are changing the game for big businesses, with reduced development times, greater compliance assurance, and stronger innovation—but these opportunities come with challenges.

Companies are turning to multiple SaaS providers and, as a result, are struggling to manage them all. Interoperability is key for businesses to ensure their systems remain seamless, with nothing falling through the cracks. Another risk is around obligations. If something goes wrong in an integrated ecosystem, businesses need to have a clear steer on where responsibility lies.

How do you balance local needs against broader industry trends while operating at a global scale?

We continue to see that trends are very much global. The US led the way in innovations around digital operations and online commerce, but we quickly saw these trends spread throughout Europe. And this works both ways. In banking most of the latest innovations began in Asia, and as the pandemic accelerated, the need to transform the US swiftly followed suit, with Europe not far behind.

When we’re thinking about how to serve our customers, we recognize that around 80% of what consumers are looking for is pretty similar, regardless of geography. It's the remaining 20% where there are profound differences, and that’s where we need to localize for the customer.

How do you think about innovation in relation to consumer engagement?

We’re at an interesting crossroads when it comes to consumer engagement. You have a lot of organizations largely concerned with hyperpersonalization, using as much information and insight as possible to learn about their customers.

However, what I find even more interesting and important is instant gratification. The likes of Amazon and Netflix have heightened our sense of urgency. This has big implications for the customers we work with and for organizations like Stripe. When consumers make a payment, they expect it will land instantaneously, regardless of who receives it or where they are located. As a provider or advisor looking to innovate and adapt to these expectations, you must have instant gratification front of mind.

What are the key trends you think will have the biggest impact on commerce in the next few years?

There are three foundational pieces that will shape the future of commerce: customer convenience, engagement, and instant gratification. Emerging digital capabilities speak to all three pillars. Innovations in data, including digital identities, have the potential to drastically change consumers' experiences by reducing friction and opening new doors of accessibility. Developments in digital currencies, particularly from the Asian market, have sparked a wave of countries playing catch-up. As governments grapple with the opportunity, companies of all kinds need to start thinking now about the implications of digital payment technologies—or risk being left in the monetary dark ages.

IBM Consulting continually supports businesses with their partner ecosystems. What does IBM look for in a partner?

We are in the business of helping organizations solve the most complex business problems, but we know we can’t do that alone. That is why our own partner ecosystem is at the very core of our strategy and how we work with clients.

Just as we advise traditional businesses, technology is moving faster than in-house development. By working with partners at the forefront of these respective challenges, IBM is assured that we are on top of the latest trends and advanced technologies, guaranteeing our advice to businesses is always a step ahead. Stripe, for example, is at the convergence of many industries, and is an expert in understanding customer convenience and wider online commerce trends. Having Stripe as part of our ecosystem ensures we are not only providing the best payments solutions, but that we are backed with the latest knowledge to help us provide the best advice across all our workstreams.

How is Stripe helping IBM Consulting address some of the world’s biggest business problems?

We rely on Stripe to help businesses adapt to the emerging environment in industries both old and new. By working with Stripe, we’re able to think about online commerce far beyond the banking industry, ensuring that all industries are up to speed on the latest capabilities. We are also excited to be working with Stripe in the telecommunications and energy sectors, as these industries become increasingly aware of the speed of digitalization and changing customer needs. The functionality and usability of Stripe APIs makes it easy for these businesses to integrate their existing services.

For traditional industries, evolving towards the latest innovations can be challenging. But the open and flexible platform which Stripe offers ensures that commerce is both painless for businesses and frictionless for consumers.