Navigating tech-enabled transformation of core banking processes | Part 1: Business execution readiness as a foundation for success - Banking blog


In an environment where change is constant and customer expectations are continually evolving, this blog series provides a valuable compass, guiding change leaders in the Financial Services sector through the intricacies of tech-enabled transformation of core banking processes with a focus on lending as an example.

In this blog, we explore business execution readiness in tech-enabled transformations and consider three common pitfalls that cause delays, setbacks, and ultimately additional costs for banks: (1) the absence of well-defined guidelines within the governance framework, (2) a suboptimal PMO set-up, and (3) failure to sufficiently consider non-IT change management activities.

This blog is the first in a series that Deloitte will publish throughout 2024. The objective is to provide change and transformation managers with insights into pitfalls that banks often encounter at various phases of tech-enabled transformation. The series will also explore key success factors, both structural and cultural, that must be integrated seamlessly into banking operations to avoid the pitfalls.

Insights from our dedicated Deloitte Banking Digital Transformation survey [2], gathered through the responses from over 20 digital change and transformation leaders in Financial Service institutions, are used to identify the key pitfalls that banks face in different phases of tech-enabled transformations, as well as their impact on project timelines (i.e., frequency with which pitfalls have caused setbacks and delays in transformation projects). Experience from our extensive Deloitte lending transformation projects is used additionally as tangible examples throughout the blog.

Financial Services Institutions are responding to a rapidly changing environment that is driven by the impact of digital technologies, where macroeconomic events such as the COVID-19 pandemic, and evolving customer demographics such as the growing influence of millennials, have accelerated the demand for digital access to banking services, as well as increased process efficiency. The imperative for banks to meet customer expectations has prompted a rapid digital transformation in their offerings and a shift to more End-2-End (E2E) modular workflow systems, especially around core processes such as Lending (e.g., with new Loan Origination Systems (LOS)) or Onboarding.

Recent Deloitte research highlights the pervasive nature of the digital shift, with 68% of the survey respondents agreeing that digital transformation is the single most important investment for driving enterprise value [1] and ~75% of their ongoing change projects within banks revolve around digitalisation [2]. Despite efforts to expedite digitalisation, considerable work remains to be done. This is evidenced, for instance, by data on digital customer journey NPS (Net Promoter Score) for lending products, revealing a substantial disparity between industry leaders (NPS approximately +90) and lagging competitors (NPS approximately –60) [3]. The rapid pace of transformation, while crucial, carries a greater risk of encountering pitfalls that can disrupt project timelines and negatively impact overall productivity: a recent Deloitte study found that approximately 70% of digital transformation efforts fail, leading to major deviations from the target objective [4].

When we look more broadly at E2E tech-enabled transformations within a Financial Services Institution, we can identify six phases. Phases 1-3 involve strategy and design. This blog explores Phase 4: Transformation readiness, which is the link between Phases 1-3 and subsequent implementation (Phase 5). Phase 4 is composed of two sub-phases (in dark blue in Figure). Phase 4.1, Overall execution readiness, involves critical business-owned activities, such as carefully assessing transformation needs and dependencies (e.g., KPI and SLA ambitions such as Turn-Around- Time, Time-to-Yes, Time-to-Resolution) and establishing clear roles and responsibilities (e.g., updated credit approval authority matrix, new workflow logic for E2E credit processing). Phase 4.2, IT set-up and infrastructure readiness, includes thorough preparation of the IT environment and development tools (e.g., credit decision engine parametrisation), as well as documentation for system transformation (e.g., new LOS features and user stories).

Overview  of E2E tech-enabled transformation approach

Overview of E2E tech-enabled transformation approach

Business execution readiness: Top 3 pitfalls

Pitfall 1: Undefined roles and responsibilities, resource allocation, and lack of clear ways of working between all units internally and externally
An absence of well-defined guidelines within the governance framework often results in a lack of strategic alignment, both at the project level and across initiatives. We often see this in inefficient resources allocation (e.g., resources operating in silos without the flexibility to work across products, and a lack of dedicated change resources, resulting in change activities being carried out by staff already engaged in the day-to-day business activities); ambiguity in roles and mandates, including unclear ownership and accountability; and insufficient collaboration. Our recent Deloitte survey highlights the pervasiveness of this pitfall, revealing that it occurred in the transformation projects of all survey respondents and caused weekly delays and setbacks in over a third of cases [2]. Especially in lending in large Financial Services Institutions, it was found that Credit Product Management, Credit Operations and Credit Risk had their own digitalisation initiatives without an E2E view and alignment despite their interdependencies.

To avoid this pitfall, the following two success factors were deemed most important by the digital change and transformation leaders in the survey:


Financial Services Institutions must take proactive measures at both the top levels in the organisation (i.e., leaders of individual initiatives in the Executive Board, and leaders of the transformation office) and the operational layers of management. The leadership should integrate digital change into strategies and decision-making processes, exerting influence from the top down, in particular to break up silos. At the same time, clarity in tasks and duties of all cross-functional stakeholders involved in the project, and the alignment of these with the objective of the transformation and the institution’s strategic ambitions becomes the foundation on which success is built.

Pitfall 2: Non-transparent set-up or insufficient authority of the project management office (PMO) function (e.g., reporting standards, aligned KPI and impact targets, deadlines, and status tracking)
A missing or sub-optimal PMO set-up limits project oversight and control, making it difficult to compare, analyse, and communicate project information across the Financial Services Institution. We have observed that these shortcomings have a significant impact on the overall predictability and impact of the initiative, and contribute to flawed decision-making processes, often diluting the achievement of targets set at the beginning. Our survey found that this pitfall occurs often during the transformation readiness process and, according to about 70% of the respondents, had caused significant setbacks and delays on the timeline at least once during their projects [2].

The top two success factors that can help avoid this second pitfall are:


Pitfall 3: Focus only on IT development, neglecting preparation of non-IT change management activities and related dependencies
Banks often put the entire emphasis on IT activities, optimistically believing that these alone will lead to a successful transformation, and they underestimate the value and the effort needed to prepare non-IT activities (e.g., policy review and simplification, business requirements validations, staff training needs) which are critical elements for transformation success. Overlooking non-IT change management activities can result in communication breakdowns and misalignment between IT developments and broader organisational goals. In E2E banking transformation projects, especially for complex processes involving several functions, we frequently observe this problem, culminating in technology solutions that inadequately serve business goals. It can also lead to bigger inconsistencies (e.g., between control documentation and new systems) or even non-compliance with regulatory requirements and prevents leveraging the full potential of the new digital tools in place. Additionally, lack of training and socialisation leads to employee resistance towards change and unsuccessful transition to business-as-usual, which impedes the adoption of new IT systems. Results from our recent Deloitte survey found that 92% of participants have underestimated the importance of the change management component in parallel with IT activities and did not sufficiently account for them [2].

To help Financial Services Institutions avoid this third pitfall, two key success factors change leaders are recommended to focus on are:


Tech-enabled transformation, such as digitalisation of lending processes and new LOS integrations, requires the ability to quickly adapt to changing market conditions while fostering a culture of openness where employees are encouraged to question the status quo and challenge existing assumptions. This can be achieved operationally by adopting agile development methodologies and implementing processes that allow for rapid prototyping and testing. An impact on the Financial Services Institution’s culture can be achieved by communicating a change narrative to employees that helps them comprehend the rationale and value of the change, along with appropriate training and development programmes. First tangible results within a few months (e.g., with implementation of identified Quick-Wins) can further show employees the benefit of change and fosters the openness to a zero-based mindset (i.e., avoiding reliance on existing assumptions in decision-making).  

In any banking tech-enabled transformation, business transformation readiness is a critical link that bridges the gap between strategic planning and actionable implementation by laying down robust foundations to achieve the desired impact in the market (e.g., NPS, market share, etc.) as well as internally for employees and shareholders.

At Deloitte, we have the experience and enablers to support Financial Services Institutions throughout their E2E transformation initiatives, such as for digitalisation of lending products. Reach out to us if you want to participate in the Deloitte Banking Digital Transformation survey (2024 edition) and gain deeper insights into your bank’s positioning relative to industry peers, or if you want to discuss how we can help you better prepare for your next process transformation initiative.


[1] Deloitte. (2023, February). Measuring value from digital transformation. Retrieved from
[2] Deloitte. (2023, September). Deloitte Banking Digital Transformation Survey.
[3] Deloitte. (2022, September). Digital Banking Maturity. Retrieved from
[4] Deloitte. (2023, April). Do You Really Know The Financial Impacts of Your Digital Transformation? Retrieved from

Key contact


Eric Gutzwiller - Director, Financial Services Transformation

Eric is a Director in the Financial Services Transformation team of Deloitte's practice in Zurich. He focuses on leading process optimization and digitalization as well as TOM design projects. He brings over 11 years of strategy consulting experience in financial services for both leading global institutions and emerging players, as well as central banks and regulators in several established markets (Switzerland, UK, US, HK, Singapore, Germany, Canada) and emerging ones (CEE, Middle East).

Email | LinkedIn 


Nadia Moutiq - Manager, Financial Services Transformation

Nadia is a Manager in the Financial Services Transformation team of Deloitte's practice in Zurich. She brings more than 6 years of experience at several financial services providers in Switzerland, Europe and the Middle East in medium to large, complex and tech-enabled front-to-bank core banking process transformation programs covering topics from change management, smart PMO, process optimization and re-engineering to testing capabilities, risks, controls and reporting frameworks.

Email | LinkedIn 


Monica Bertolotto - Senior Consultant, Financial Services Transformation

Monica is a Senior Consultant in the Financial Services Transformation team of Deloitte's practice in Zurich. Her main focus areas include front-to-back core banking processes optimization with a focus on change management topics in asset digitization projects. Monica has developed additional expertise in the fields of risk management and regulatory compliance of Swiss and international G-SIBs and private banks.

Email | LinkedIn 



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