Hackathons Fueling Banking Innovation4 min read
The fast-paced digital evolution of the banking industry, driven by increasingly higher expectations of excellent service and personalized products from connected customers, has transformed innovation into a business imperative. The success of any innovation project is largely dependent on a bank’s ability to foster collaboration between stakeholders. One of the most efficient and scalable approaches to sharing and developing ideas is through a hackathon.
Hackathons are moderated, multi-day activities designed to boost innovative ideas and address key customer challenges. Programmers, developers, and non-technical specialists with various backgrounds are brought together to push the boundaries of lateral thinking and tackle challenges in an inventive way. Rather than purely focusing on designing new products, a hackathon’s primary goal is to adopt the spirit of innovation and challenge existing processes and systems through a collaborative competition.
For example, if a bank wants to develop a new mobile app, the bank’s innovation and product development teams would organize and host a 12-hour to two-day event to create a working prototype of the app. Participants at this event can be experienced professionals of all career levels invited from across the industry and/or from within the bank.
At the beginning of the event, the bank organizers lay out the requirements, task synopsis, time and resource constraints, and all other pertinent project information. A key facilitator or project manager is elected to lead each team.
The first half of the hackathon would revolve around ideating, designing, and collaborating to create projects. The teams start by focusing on key pain points to determine what problem(s) the app is designed to solve, and brainstorm ideas using a diverse set of inputs from subject matter experts (SMEs). These SMEs, experienced developers and departmental leaders from the bank or from third-party companies, act as on-site mentors and offer valuable advice on technical and non-technical implementation of the project. This advice could range from how to develop the correct strategy to progress from paper-to-prototype, the provisioning of mobile statistics and insights (e.g. smartphone penetration in a specific geo-location), and more. The teams work in an open collaborative environment, reinforcing trust and solidarity to focus on complex business issues, such as how to manage and treat data with respect without being customer-intrusive.
In the second half, project teams test prototypes, prior to pitch sessions and final project presentations to judges. Participants adopt a fail-fast iterative approach using a startup methodology to rapidly develop prototypes. This is where mentors are vital, offering direction and not just critique. Prototypes are usually tested with a sample of customers with the help of user-experience research teams, but in the closed environment of a hackathon, ideas can be tested by team members and mentors. Rapid prototyping, iterating, and testing stages are absolutely crucial, ensuring working models are functional and accomplish the intended use. The final product is ready for launch once accepted and agreed by team members.
The event concludes with participating teams pitching ideas to other teams and a judging panel comprised of senior developers, leaders from the bank, or from a third-party company. Teams with the winning ideas are often rewarded with continuing development of the product, in co-operation with the bank.
Hackathons give banks an opportunity to break through conformity and quickly generate and test innovative product ideas within time and resource constraints. Blocknify, a FinTech allowing signatories of important contracts to feel secure by using blockchain technology and QR codes, was born from a hackathon. Outside of banking, prime examples include Facebook’s ‘Like’ button and file sharing company Dropbox. SoftServe’s business innovation hackathon for Amplify explored how Amazon's Alexa could provide value to a client’s educational product.
SoftServe's hackathons facilitate a collaborative and transparent environment for participants to share and harness innovative ideas transforming banking. Use our Innovation Platform to crowdsource and capture ideas, and generate workflows to deliver innovation.
To learn more about the benefits of how our Innovation Platform can help to facilitate a hackathon, read our whitepaper, "Innovation in Banking".