How DBS became the “best bank in the world”
The best bank in the world, it seems, has managed to outdo itself. For the fourth consecutive year, Singapore-based DBS Bank has been named “World’s Best Bank” by Euromoney, a leading industry publication. It also snagged the title of “best digital bank in the world”, marking the first time that the two titles have been held by the same institution. While Southeast Asia’s largest bank owes its latest triumphs to bold initiatives launched during the pandemic, including new online exchanges for blockchain-based fundraising and carbon credit trading, its rise to the top builds on a digital transformation that has been underway for years.
This transformation was launched in 2014 by CEO Piyush Gupta and his management team. Their vision: to make the bank joyful. An ambitious goal, given the tarnished image of the industry after the global financial crisis as well as a growing shift towards online financial transactions. In fact, a investigation in the United States showed that 71% of millennials preferred going to the dentist rather than their local bank branch, and three out of four preferred financial services from Google and Amazon.
The tech menace was impressed with Gupta during a meeting he had earlier in 2014 with then-Alibaba CEO Jack Ma. This hour-long meeting convinced Gupta of the disruptive forces emerging from China that would revolutionize the banking industry.
To win over a new generation of customers, DBS realized it needed to occupy the same space as tech startups, leveraging new technologies to take the hassle out of traditional banking. In short, it was a question of making the bank “joyful”. This vision would be based on three strategic principles: to become the heart of digital, to make DBS “invisible” and to create a culture of “start-up of 30,000 people”.
Go digital to the core
Part of DBS’s success is its creativity in overcoming the digital transformation challenges that other organizations face. Jtwo out of three digital transformations fail at least partly because leaders underestimate the scope and impact of the project. DBS senior executives decided early on that emerging technologies and the use of data needed to be integrated across the bank, with alignment across all divisions.
The transformation quickly pays off. First, DBS dramatically reduced the time to market for new products. For example, in 2016, it launched India’s first digital-only bank through a mobile app powered by weekly updates. The following year, digibank added over a million customers.
DBS has also built ecosystem partnerships, an essential strategy in a hyper-connected world. More recently, the bank associates with fintech Doxa to launch an automated payment solution for Singapore’s construction industry, which accounts for 4% of the country’s economy. It aims to help entrepreneurs improve cash management and reduce costs by digitizing documents and automatically tracking payments.
However, transformations are never easy. For DBS, a first challenge was to start solving problems by thinking like “techies” rather than bankers. His solution? Proclaim itself “a technology company providing banking services” and compare itself not to other banks, but to leading technology companies. To encourage employees to think like technicians, and not just any technician, but Jeff Bezos, Amazon’s famous customer-focused boss, DBS adopted the phrase, “What would Jeff do?”
He also distilled lessons from major tech companies with the catchy mnemonic “GANDALF,” after the wizard of The Lord of the Rings fame: G — use open source software like Google; A — run software on Amazon’s cloud platforms; N — use data and automation at scale and personalize recommendations like Netflix; A — design systems like Apple does; L — push for continuous learning in the footsteps of LinkedIn; and F – focus on building communities like Facebook. What about “D”? It’s for DBS, of course.
GANDALF helped inspire a new mindset for DBS’ core digital and technology transformation. The bank has identified and adopted five key initiatives:
- Moving from products to platform – replacing empowered teams with overseeing their own products for long-term projects filled with steering committees and bureaucracy
- Develop high-performing agile teams – in the pre-transformation DBS, business departments set the goals and technology played a supporting role. Now both parties come to the table as equal partners with share goals and projects
- Automate everything – build, test and deploy systems faster
- Design for modern systems – design technologies and build systems that are scalable, elastic, and ready for experimentation using the cloud
- Organize for success – equip employees with the right tools and support to enable agility
Become “customer obsessed”
At DBS, customers come first, followed by employees, then other stakeholders. Gupta believes that putting the customer first provides a unifying purpose for employees. The bank has embraced customer journey mapping – a method of viewing the customer’s interaction with the bank from their perspective – and made it the default tool for resolving customer issues. The bank also used hackathons and design thinking processes to help employees focus on the customer.
In 2017, DBS spear a platform for developing APIs, the software protocol that allows computers and applications to communicate with each other. The platform allows software developers to “talk” to DBS and connect to the bank’s services, such as a peer-to-peer payment service and mortgage affordability ratings. Today, the network has over 1,000 open APIs. For example, cars can now be bought and sold on the bank’s platform, with DBS car loans seamlessly integrated into the system. The bank becomes “invisible” to its customers while meeting their needs.
Become a start-up
One question DBS management asked early in the bank’s digital transformation was, “What’s the biggest barrier to embracing a startup culture?” It turned out that was the way meetings were run, a common bane of many large, complex organizations. There were too many meetings, and too many of them were ineffective or had no stated purpose.
Enter “MOJO”, short for Meeting Owner Joyful Observer, a campaign to end meetings that went nowhere. He had a simple rule: Meetings should start and end on time and have a set agenda. MOJO delivered serious benefits, saving the bank over 500,000 man-hours.
To develop a start-up culture, the leadership team cultivated five traits throughout the organization: agility, continuous learning, customer obsession, data-driven experimentation, and decision-making. risks. Last year, as the pandemic raged, the bank created a task force on the future of work. Today, employees have the option of working from home up to 40% of the time. For those who need flexible working arrangements, the bank offers a job-sharing scheme that splits a typical full-time job between two employees.
Meanwhile, the bank is accelerating its transition from conventional functional departments to agile, project-specific, data-driven teams made up of members from different functions with relevant areas of expertise. The workspaces are also redesigned.
On its way to becoming the ‘best bank in the world’, DBS’s revenues have grown from S$9.6 billion in 2014, the year it launched its digital transformation, to S$14.6 billion last year. But he is not resting on his laurels. The bank has developed a new vision: to be a better bank in a better world, focusing on the pursuit of digital transformation and sustainability. It aims to provide products and services that promote sustainability, engage in sustainable purchasing, support social enterprises and businesses with positive social impact, and give back to the communities in which it operates.
Robin Speculand is co-nominated with DBS Managing Director Piyush Gupta for the Ideas into Practice award from Thinkers50, a biannual global ranking of management thinkers. The 2021 Thinkers50 Awards Galaof which INSEAD is an educational partner.