The Art of Digitalization
Digital transformation has made its way to the top of everyone’s buzzword list recently, mostly due to the Covid-19 pandemic. In the U.S., the coronavirus forced most organizations to go digital sooner than many had planned or imagined. While Vanguard successfully navigated the sudden need to move crew, i.e our employees, to an effective and secure work-from-home environment, the firm has been on a digital transformation journey for several years.
In fact, Vanguard has long been at the forefront. We are a global asset manager that’s been disrupting how people invest since 1975. Today, we have more than 30 million clients worldwide and manage more than $6.6trillion in assets. We offer more than 422 investment products and have no physical retail branches. We are, in nature, a digital company. More than 90 percent of our client interactions happen digitally.
But as technology changes, so too must our systems and businesses. That has been a priority for Vanguard, especially with the onset of cloud technology. Almost a decade ago, a small group of IT leaders came together to discuss how cloud technology might enhance our business.
One of the first critical steps in any digital transformation is to identify why you’re transforming—what will you be able to achieve as a result of the transformation? At Vanguard, we wanted to move faster without sacrificing security. We wanted our cross-functional teams to innovate with modern technology to attract top talent from around the globe. And most importantly, we wanted to continue to create world-class, personalized client experiences, as our core purpose is to take a stand for all investors, treat them fairly, and give them the best chance for investment success.
After identifying our ‘why,’ we were able to move into the ‘what’ and ‘how’ of our digital transformation. For us, that meant pivoting to cloud technology and retiring legacy systems and monolithic applications. It meant building cloud-native software with a security-first mindset. And it meant accessing data to build out our client experience. Because of this, we are delivering business value at startup speed, decreasing the cost to compute, building software faster, and increasing our ability to deploy capabilities.
One of the first critical steps in any digital transformation is to identify why you’re transforming— what will you be able to achieve as a result of the transformation?
If you are considering a digital transformation, or have started one recently in light of the global pandemic, here are three things to remember:
1. While the transformation may seem technology-driven, people make it possible. Prioritize their well-being, empower them to make decisions, and take ownership of products and of the company culture.
2. Fail fast, and try again with the speed that technology changes, your choices for what to buy or build can feel overwhelming. Rely on the advice of the people working closest to what you’re trying to solve, test it, learn from your results, and test again.
3. You can’t solve every challenge at once. Prioritize the critical changes that need to be made – that will set you up to make other changes you’d like to see down the road.
4. Put the client at the center of the experience. Digital transformation allows you to be agile; being agile enables easy and frequent experimentation; frequent experimentation and client feedback can help you achieve client obsession.
Digital transformation is a journey we’re all on now, whether we were planning for it at the start of 2020 or not. I’m very proud of where our digital transformation has taken us so far. But that’s the beauty of a transformation— one layer is modified, and the next layer begins to change. We are on a constant journey of innovation and improvement so that we can deliver on our core purpose every day.