Southern Bancorp Chief Innovation Officer Vance Smiley focuses on in-house innovation to solve client friction within wealth management and access to capital.
“We’re focused on identifying problems first and then being methodical about looking for solutions,” Smiley told Bank Automation News. “Some of those can and will be found externally, but only after determining our exact needs. Of course, with an innovation team on hand … we can tinker around solving these problems ourselves and have a little fun doing it.”
The $2.5 billion, Arkadelphia, Ark.-based bank’s innovation lab, TeamWALT, has introduced new digital services for Southern Bancorp clients, including automated savings app Wealthable and savings game Envie Envelope Challenge, each of which launched in fewer than 120 days.
BAN caught up with Smiley to discuss Southern Bancorp’s innovation lab strategy and how automation plays into innovation. What follows is an edited version of that conversation.
Bank Automation News: How does Southern Bancorp prioritize its digital strategy?
Vance Smiley: It’s a high priority, but it’s also running parallel to the needs of the traditional, geographically focused side of the business, which is what made us what we are today and continues to be a strong growth driver, so we continue to look for innovative ways to grow.
However, much like within our traditional markets, there are individuals, families and small businesses across the country experiencing challenges to their own wealth-building journeys, and a digitalization strategy focused on those problems and addressed with purpose-driven mobile apps is how we’re working to scale.
BAN: How does the bank decide on an innovation project to pursue?
VS: We do a lot of prototyping and testing, both internally and in our markets. We talk to our staff on the ground, who are working with people to overcome challenges, and then we design solutions with their input to test.
A large focus of ours lately is working to get capital safely into the hands of those who aren’t using the traditional financial system. Either because of a bad experience or a general mistrust of banks, these folks have opted to utilize what we call the alternative financial system, which is high cost and often predatory. Our mission is to develop alternative solutions that are affordable, trustworthy and easy to use and access.
BAN: What role does automation play in your approach to digitalization?
VS: In the process of innovation, we learn, then build process improvements that make sense to share with the traditional bank, which doesn’t always have the time to stop and determine them for itself. Automation is one of those areas that can result in valuable enough process improvements that you could actually pay for an entire innovation department’s budget with the savings.
BAN: What is the bank’s approach to in-house innovation?
VS: While I’m certainly not opposed to developing partnerships, especially when it comes to improving efficiencies and scalability, I do come from the school of thought that says the main parts of innovation can’t be outsourced, and I don’t believe that we as banks can buy our way into innovation.
It takes smart, creative thinkers who deeply understand the mission and operations to imagine solutions for the problems we face. Once we do that, assembling the technology is the easy part, and we’ll often look for partners to assist with that.
BAN: What is your best leadership advice?
VS: The first is that we can’t outsource what makes us … us. If we do, then we might as well get out of the way and let someone else do it. Another piece of advice I strongly believe in is to go get good at something. I think too many banks seek to be generalists when focusing on serving specific groups and types of customers. Finally, recognizing that the customer relationship is moving from in-person to online, whether we like it or not. So, we better prepare accordingly.