My wife and I were sitting there the other night hoping to watch something on TV. But first we were faced with a flurry of questions that demanded our attention. We have our A List of streaming services – Netflix, Prime (with Acorn and Masterpiece add-ons), BritBox, Hulu, Apple and HBO – so the first challenge is always trying to remember which shows are on which services. Or are they on the cable carrier’s on-demand feature? When does the next six or eight-episode season start? Is the show in question bingeable or is it one of those episode-a-week deals? If the latter, did we already watch this week’s episode? Will Nigella Lawson be able to fill the shoes of Dame Prue Leith?
Oh, how I longed for the days of three VHF stations, a channel-selector knob that clunked so loudly it made the doily on the end table shimmy, and the trusty TV Guide to help navigate all those myriad choices. What I wouldn’t give for that degree of simplicity built into my current 80-inch surround-sound smart TV.
That got me to thinking about the parallels to my digital financial life. I remember scoffing when I first heard that most people have 20 or more financial apps on their phones. Then I counted mine. I had 26. Wth? All my life, I was told that technology would make our lives simpler. Juggling 26 or more apps just to make sure I have a handle on my money is anything but simple. I don’t care if each one of those apps is a masterpiece of UX art. The fact that there are 26 of them makes the whole experience a cluster.
The Death of the PFI
For decades, it was the dream of every credit union to be the member’s primary financial institution, positioning their credit card top of wallet and their usefulness as a financial resource top of mind. Some succeeded; others didn’t. But that didn’t really matter as long as they tried hard to achieve that PFI status.
Then along came digital/mobile and the whole industry abandoned that dream overnight. Suddenly, becoming anyone’s PFI seemed entirely out of reach.
I can’t tell you how many pundits, experts and wizkids I’ve heard declare that the PFI is dead and credit unions need to be satisfied with the few slivers of the financial pie that they’re able to carve out. Invariably, the response of anyone within earshot is a head nod as if to say, “Duh, of course the PFI is dead.”
Bullshit.
The PFI may be on life support, but it’s not dead. And the only reason it’s on life support is that we got lazy. We failed to truly embrace the technology and adapt to the changing world around us. The silver lining here is that it’s not too late. We have within our grasp all the tools we need to revive the PFI as the new and mighty digital primary financial institution, or DPFI.
The Point Solution Predicament
The “platform versus point solution” debate is nothing new. Platform developers can give you a million reasons why platforms are better, and point solution developers can give you a million more reasons why point solutions are better. The debate has achieved a new relevance, however, because of the incredible proliferation of fintech point solutions. Attend any of the pitch-heavy conferences and you’ll soon discover there are at least 10 point solutions available to address even the most microscopic problem.
Point solutions are a quick and easy fix, to be sure. The bank down the street offers X and some of our members have mentioned X, so let’s plug in a point solution that addresses X.
Indulge me for a moment and reimagine your credit union as a restaurant. Except in this version of the universe, you’re forced to buy spoons from one vendor, forks from another vendor, knives from another vendor, salt from another vendor, and pepper from another vendor. Multiply that by 20 and that’s where we are in today’s point solution frenzy. I’ve had CTOs from larger credit unions tell me they’re now managing 80-100 vendor relationships. That might be more acceptable if all the effort produced a better result.
Ironically, both credit unions and their members find themselves in the exact same predicament – trying to piece together dozens of point solutions in an effort to create a functional user experience. Fix that for your credit union and you fix that for your members. And you become their DPFI.
The Skeuomorphic Trap: From Bob’s to Jobs
Skeuomorphic. There’s a word you don’t hear every day – maybe not even any day. But it’s an important word to this discussion. For the uninitiated, skeuomorphic design is a style where digital or manufactured objects imitate the appearance, texture, or function of their real-world physical counterparts. Allow me to share a couple of examples.
In 1995, Microsoft introduced Bob, billed as the first human PC interface. Bob attempted to simplify Windows for beginners by replacing the standard desktop with a cartoon living room staffed by talking animated pets, where clicking a digital desk launched word processing and clicking a wall calendar opened your schedule.
Bob suffered on two fronts. First, it required a state-of-the-art Intel 80486 processor and (gasp!) 8MB of RAM when most of its target demographic was plugging along on their 386es with 4MB of RAM.
Second, by this point in digital history, common folk understood how to operate their computers. They didn’t need a screenful of idiotic visual metaphors to guide them. It took barely a year for the marketplace to say, “This is stupid. Take it away.”
The brilliant and revered Steve Jobs was also passionate about skeuomorphic design. When Apple launched the iPad in 2010 and with it iBooks, he insisted on polished woodgrain bookshelves, page-curl physics, and faux-leather stitching. After he passed away, Apple discovered that such embellishments were actually reader distractions.
Want a more current example? Think back to the Covid era when virtual conferences replaced (by necessity) in-person events. The near unanimous verdict on virtual conferences: They all sucked. Why did they suck? Because organizers attempted to replicate the IRL experience – virtual general sessions, virtual breakouts, virtual exhibit halls, virtual cocktail hours. They ignored the technology that was available to create an exceptional experience in favor of technology that created a familiar experience. (Incidentally, Finopotamus is working on a fix, but that’s for another discussion.)
I’m not aware of any credit unions that have employed skeuomorphic design. However, I do think most are guilty of skeuomorphic thinking. In the face of the digital revolution, they’ve been trying to figure out how to move that legacy member experience into the virtual world. The question they should be asking is: If I were to start a credit union today, using all the tools I have available and with all I know about my members and their needs, what would that credit union look like? Then they should work toward that.
In Part 2 next week: Why Mint and data aggregators failed, what credit unions can learn from Walmart Supercenters, and how to turn back-office orchestration into the ultimate member experience.