How U.S. Bank is Building a Resilient Digital Bank

Jim Marous (00:12):

Hello everyone. We've gone through this before. We've had events, you've seen me more than you ever wanted, more than I want to see myself. This is going to be a great session.

Jim Marous (00:23):

Our podcast today that we're recording, and we'll actually publish it on both the audio, podcast channels as well as YouTube is with a person who actually I've known even back before The Financial Brand, who've interviewed I think four times and has continually performed better than almost anyone else we've ever interviewed on a consistent basis.

Jim Marous (00:47):

My friend, Dom Venturo, from US Bank is an innovator, and we'll talk a little bit about his journey because I think it's very interesting for marketers to realize the progression of where the business is going because he's on the cutting edge. I do want to also spend some time thanking Naehas for their sponsorship of this podcast. Without them, none of this would've been possible.

Jim Marous (01:07):

So, without further ado, I'd like to introduce Dominic Venturo. So, Dom, as I mentioned, we've had you on the podcast. We've interviewed you live two years ago at the Financial Brand Forum at a room that had nobody in it because that's the way we did it back then. A little bit about your background, can you talk about where you started, at least with US Bank and maybe even before and where you are today?

Dominic Venturo (01:33):

Oh, how much time do you have? I've been at this for a long darn time. I guess the easiest way to think about it is I'll break it up into chunks. So, I spent the first about 10 years with Bank of America and its predecessors on the West coast and I started in banking and a lot of people don't go to school to go start to be a banker, I actually did that.

Jim Marous (01:54):

I did as well. So, we had that in common.

Dominic Venturo (01:57):

And so, I started out in a training program and worked my way up through the ranks. But I quickly discovered that I really liked product, product management, product design and so I spent an awful lot of time in the product side of the world.

Dominic Venturo (02:12):

I joined US Bank a little over 26 years ago, so that's quite a long time. I think we had 20 some thousand employees when I joined and we have 70,000 employees now, so a little bit different over the years, few mergers in between acquisitions and the like.

Dominic Venturo (02:32):

But from a career perspective, I've been in product, I think the big change in my career was probably about 14 years ago when we created the innovation group at the bank and that was part of the payments organization.

Dominic Venturo (02:46):

One of the things that we talk a lot or Jim talks a lot about is the competition from the fintechs, the emerging, the speed at which they change. And if you can believe it or not way back when we created the innovation group, that was the impetus for what we were doing.

Dominic Venturo (03:02):

I was in the payments organization and what we saw was the emergence of companies that were using new technology stacks, new delivery models and new capabilities to be able to rapidly build and deliver products and bring them to market.

Dominic Venturo (03:19):

And our whole thinking at the time was, we need to learn what's working there, and then we need to develop a way to be able to get that into our culture and our DNA as a company and we started in the payments business with that mindset.

Dominic Venturo (03:35):

So, thinking about the three horizons innovation, thinking about always looking up and over the horizon, doing applied research and development to build prototypes, to test them with customers, and then begin to bring them to market were the early days of the innovation.

Dominic Venturo (03:51):

And for the last four and three quarters, I guess years, I've had the privilege to run what we call the digital organization at US Bank. And that organization just very simply is consumer, small business and institutional customers, the digital solutions that serve them, so I'll just keep it simple. And then we still have the innovation practice, and then I also have the artificial intelligence COE so that brings you current to today.

Jim Marous (04:19):

So, it's interesting as a backgrounder to people that aren't familiar, one of the reasons why Dom has been on the show many times and why we've been friends for … not the only reason we've been friends for years, but has kept us both interested in each other's business, is that when people ask me, "What are the most innovative financial institutions in the U.S.?"

Jim Marous (04:38):

I will normally mention Chase, but I usually surprise them by saying, “My bank for the buck, the organization is doing the best is US Bank.” Most people don’t know that because they do it in a rather silent way. It’s a Midwestern style if it were.

Jim Marous (04:54):

And the reality is, part of that reason is because as Dom mentioned, how far back that innovation mindset was put in place, and we talk about putting innovation in the culture, but that was really one of your driving force because when you are in the product areas, as I understand it, you're kind of innovating, but you're within a nice little compartment but the innovation process as the spearhead for the way you're going to manage it really becomes key.

Dominic Venturo (05:21):

So, what did you take from your days in the innovation side to the digital side? Did it help because that digital progression was a whole lot faster than the innovation progression?

Dominic Venturo (05:35):

Yeah, I mean, I guess you have to think about this thing in a couple of contexts, and I want to kind of just make it very tangible for the audience. One of the things that you ultimately have to be able to do is look at your delivery model.

Dominic Venturo (05:51):

Financial institutions have legacy systems that a lot of them still do waterfall delivery, we've talked about agile and the speed of agile and there's agile decision making, there's agile organizations, and then there's agile delivery and you have to be able to do all of those, so you actually have to infuse that into the organization.

Dominic Venturo (06:10):

So, the speed at which make you decisions, the speed at which you then can do your quarterly planning and your release management means you have to re-architect your software delivery lifecycle, you have to go back farther up the funnel and re-architect your product development lifecycle so that you can continue to do that and operate it at speed.

Dominic Venturo (06:29):

And what we learned in the innovation group was that you also needed to be able to trust the ability to build something, pilot it, test it, and kill it if it doesn't work, which a lot of people have a hard time doing.

Dominic Venturo (06:45):

Because if you think about the investment curve going sort of up into the right, which is the bigger the project, the longer it takes, the more money you spent, the more money that you now have at risk on that decision, which is why you see a lot of what I'll call zombie products that are around, which is we spent a lot of money on it and never really got traction, but we can't kill it because we spent a lot of money on it.

Dominic Venturo (07:06):

What you want to really be able to do is compartmentalize down to your most lovable product or most valuable pilot and be able to bring that to market, you have to redesign the whole system to do that.

Dominic Venturo (07:20):

You can't just decide you're going to do that, you have to bring the risk team into the front end of product development, you need to bring the product owners into the front end of product development and the technology and the engineering and the architects so that now the teams are able to sort of say, "Oh, I know what you want to do.

Dominic Venturo (07:35):

Here's how we're going to test it. Here's how we're going to make sure it's compliant, here's our success criteria but you got to send in advance, otherwise you'll convince yourself later changing the bar is a good idea and it was good enough. Set your success criteria and then have a go-to market and scale plan.

Dominic Venturo (07:54):

And to do that across an entire company and an entire portfolio of products means you have to be consistent, you have to have a process, you have to have a machine, and you have to be able to monitor all of that at pretty significant scale for a bank our size.

Jim Marous (08:13):

So, the capsulized summary of what we are going to be talking about today, talked about resilience. Now we're among retail bankers, many of them managing front-facing systems, wondering about what's the next innovation that's come through and wondering how are we going to keep up with the pace of change.

Jim Marous (08:33):

But when we talk about resilience in banking, it's usually a back-office reference. It is usually about how do we keep uptime at a very high level? How do we make it that if something happens, it unbreak itself very quickly.

Jim Marous (08:47):

I'm not the tech person, so I'm abusing the wrong terminology, but when you think about resilience in banking, it has always traditionally been how do I make sure that I never break the trust with the customer on a fraud, on a risk, on a technology, and in a digital world, on an uptime basis.

Jim Marous (09:04):

The difference though is as we look forward, that isn’t enough. So, Dom, compare what your definition of resilience and US Bank's definition resilience is and compare it and contrast it to what most institutions still define resilience as.

Dominic Venturo (09:24):

First, I'd like to say, I don't use the phrase unbreak things, I use a different one, it's a little more colorful. But you think about resilience you really need to think … like I used a terrible example, which is a car that doesn't dent because things are going to bump into it and the like, and you have to think about being able to bounce back from whatever that thing was.

Dominic Venturo (09:47):

And sometimes that's a competitive dynamic, sometimes it's a market dynamic and sometimes it's a technical challenge. So, the underlying table stakes for large financial institutions and small doesn't matter, is that the systems need to be uptime, they need to work, they need to have geographic diversity, they need to have automatic fail over, they need to have battery backup because there's a whole host of things that we can predict can and will go wrong and so you plan for those. That's the technical side of the house.

Dominic Venturo (10:15):

I think the other part though, that you're talking about and we spent a lot of time around is like, where is the future going and what are the expectations going to be within the foreseeable future from our customers around how we deliver products and services and what kinds of things are available to them?

Dominic Venturo (10:33):

And one of the tools we use is within the innovation group to be able to look far out onto the horizon but also understand the emergence of technology and the landscape that's happening. And I can't give you future examples, so I'm going to give you some older examples that hopefully will help.

Dominic Venturo (10:50):

A number of years ago we saw what was happening with information exchange with other parties. So, think about FTP transfers or other data exchanges that happen. And we saw in the technology world and in some of the emerging fintech space that folks were moving to really simple and elegant, well-documented APIs, developer portals and capabilities and our prediction was that's the way business is going to be done in the future and this is years ago.

Dominic Venturo (11:21):

The end result of that is we decided to invest in API development platforms and also the microservices capabilities within our technology architecture that would allow that to happen so that when a payments company wants to plug into us and be able to do payments on their end, but initiate them through the bank, we have an API for that. When they want to be able to validate that an account is valid and has a balance, et cetera and they're permitted to do so, we have APIs for that.

Dominic Venturo (11:53):

So, it's a good example of, at the time they were not widely used in banking for connecting to other payments or financial services providers, but we saw that trend in the technology side of the house and in the technology world of products and services and saw that and there are just a ton of those kinds of examples.

Dominic Venturo (12:13):

The last piece is, remember I talked about the product development lifecycle has to be redesigned and the delivery model does and all of that is around both agile, speed and nimbleness. If you've reduced everything that you're doing into quarterly sprints planning cycle or quarterly planning cycles and capacity, you have the ability to change either within a set of a quarterly planning cycle if it's really urgent or to be able to get it into the next piece.

Dominic Venturo (12:41):

And the end result of that is in our example, we can go from this well-defined thing on a whiteboard that we want to do to a version of it that's in production within a quarterly planning cycle, which is pretty impressive and we can do multiple releases a quarter within the collection of applications that we have to deliver.

Jim Marous (13:00):

That's really resilience to be able to compete.

Dominic Venturo (13:02):

It's resilience to compete and also to adapt. So, I'll share one other item is we're constantly monitoring the feedback that we get from customers and those signals come from call center, chat transcripts, they come from feedback on issues that we get from call centers or problem management and problem resolution.

Dominic Venturo (13:23):

They come from complaints, but they also come from the CSAT surveys that we do online and the feedback that we get from the customers and all of that gets digested in near real time and gets fed back to the product organization to say, "You know what, folks are having a problem with login over and over."

Dominic Venturo (13:41):

And again, this is an example of something that we saw as the advent of people using password managers more often actually caused some problems with the way passwords are entered on banking websites so we had to rethink the way that that’s designed or bill pay doesn't work great when you're trying to pay more than five bills at a time.

Dominic Venturo (14:00):

And we get that kind of granular feedback back to the product teams in real time and we can get it into the backlog and get it into production so that we can change it.

Dominic Venturo (14:09):

When we make those changes, we also have built A/B testing capability so we can have a hypothesis, we can build a change, we can deliver it to a subset of customers and see if it actually performs better before we launch it to the entire organization. That also allows us to be nimble because we might discover and often do that, we need to refine it further, all of that is resiliency.

Dominic Venturo (14:33):

The last thing, sorry, I'm on a bit of a roll, but the last thing that I think is really important is then you have to look at the performance of all of your solutions. And what I mean by performance is how fast does the mobile app load? How fast does the page load? Is there a data element that's causing a problem at that kind of a granular level?

Dominic Venturo (14:53):

Because it may be that the API that calls the balance from the rewards card thing which hops from here to here to here takes too long and that then hangs up the whole experience which creates a bad experience for the customer.

Dominic Venturo (15:05):

So, the level of detail and diagnostics that you need to be able to continuously improve is fairly tremendous but when you have it, you can go from, "Oh, I think this is the issue,” to a data-driven decision of “This is the issue, this is how many times it happens and why it's important. Let's go fix it.”

Jim Marous (15:25):

So, the foundation of a lot of this, it's the technology in the back office, we've talked about this. You were doing it when we talked about innovation, the only way we can make innovation work at speed and scale is to have the technology in a digital world that can adjust to that quickly and adjust to something that's completely unforeseen. Adjust to a COVID check program that had to be done in four days that the government gave to be in a position to do that.

Jim Marous (15:53):

But I think what's interesting is when we're dealing with improvements, product improvements, when we're dealing with innovative new solutions, when the marketplace changes, when you go from a cash — to a credit poor environment and you all of a sudden say, "We need to come up with brand new products that don't exist today or let's find a way to let consumers access a line of credit that's smaller than we've ever done, but an instantaneous basis." Those type of things make you more resilient.

Jim Marous (16:25):

I think my best example is, I think we were talking about this once before that in 2000 I was in Shenzhen, China and was lucky enough to be able visit WeBank and the biggest digital bank in the world. They do most of their customer acquisition is providing financing for mobile phones, very small loans.

Jim Marous (16:47):

But what happened is they found ways to make the entire process of who they should target based on the way they use their phone. Going further along your line, they had four parallel cloud platforms that allowed them to test new ideas instantaneously. They innovated on a 14-day cycle, very close to the time period you're looking at where they were able to get in and get out instantaneously.

Jim Marous (17:13):

And it was interesting because their think tank is found by Windows and in that you have all these empty desks. And I said, "What are those empty desks?" And they said, "That's where the product managers will sit when they identify a problem that may have happened on a call center through another channel."

Jim Marous (17:28):

And they have the power to instantaneously fix it for the masses, which makes you, in the broad sense of resilience, resilient because that allows you to respond very quickly, is at the end of the day, the consumer, be it the natural consumer or the small business corporation doesn't want you to be waiting for that answer. And you want to be able, as you said, to be able to say, "Okay, is this something that's going to be a massive change or a minor change?"

Jim Marous (17:56):

I think the last time we interviewed you we talked about the new account opening process. It was relatively new at that process and you talked about how you went about bringing the right people together. Is bringing the team together part of that resilience process, not just on a technical basis, but on a human basis?

Dominic Venturo (18:18):

Yeah, it's a really big part and it's super important to understand that when I'm talking about digital which is my organization, but the reality is all of what we do, and Jim is very kind and gives me credit for it but the reality is all of what we do is a whole organization body of work.

Dominic Venturo (18:38):

Because you have to have the person that owns the operations and the call center as part of that, you have to have the connectivity to the fraud teams, you have to have the connectivity to the risk and compliance teams and to be able to bring them in and that doesn't mean you have to have 50 people in the room. So, you have to have a small group of owners, if you will, for those bodies of work to be able to do it.

Dominic Venturo (19:03):

I think the other part is when I say product, there are the business line product owners. So, we call them chief product officers, then there are the digital product owners, their partners on the digital version of the solution for their product just because we manage the container, how we do that is the collection of those experts.

Dominic Venturo (19:24):

And we want to get as much good information as we can about what it is that we're trying to accomplish really early. Because once we hand it off to the teams to put into quarterly planning, what we're telling them is, this is your success criteria, this is what we're trying to accomplish. We're not telling them how to design it or how to build it, we're telling them what we're trying to accomplish.

Dominic Venturo (19:47):

So, a new account opening that Jim referred to, we had a collection of products, they all had different fields of information that required in order to be able to get it. So, credit card was one thing, checking account was another, savings was another and there was some commonality in those fields of information but not a lot.

Dominic Venturo (20:07):

But what we were trying to do was build a digital onboarding experience that would allow a customer to be able to become a customer with as little information as possible, what was required and to be able to get to it.

Dominic Venturo (20:19):

And the breakthrough that we had, and I had nothing to do with this, this was an another senior executive at the time, but the breakthrough that we had with the team is they were struggling with trying to get everybody to align on what that data set would be. He said, "Okay."

Jim Marous (20:35):

In a legacy, or, I mean, we have to remember, we take it for granted, but in a legacy organization, it's always done it a certain way.

Dominic Venturo (20:41):

And this is five years ago but the breakthrough was, "Okay, we can't get to consensus, this is taking too long. Let's take all the fields off the table." So, we're going to go from whatever it was, 16 to zero, and then each one that we add has to be mission critical to the objective and we ended up with just a handful.

Dominic Venturo (21:06):

And that was a breakthrough in thinking, which if you think about taking away all of the constraints and starting over with a fresh sheet of paper, you remove that 20 years of this is the way we've always done it and you say, “We're going to do a completely different.” Now, start with a blank page and come up with the best possible experience that you can and the reality is we came up with a great outcome.

Jim Marous (21:28):

Well, it is a funny story because I remember when you said it, you added a little thing that, that you said, yes, we had 16 things, let's say it was 16 things. And he goes, unfortunately, we realized how much of a legacy we bank we were, because we got people in the room. They came back and said, "We now have 18," because we can't get people together without adding new stipulations and then you got down to zero and they moved from there. You included-

Dominic Venturo (21:50):

We're down to two now.

Jim Marous (21:52):

Yeah. Oh, exactly, exactly.

Dominic Venturo (21:55):

Two fields of info. We can do a new account with some help from some technology partners.

Jim Marous (21:59):

And think about what that means when you're trying to cross sell, when you're trying to build relationships in a digital world as opposed to making people come in and do things the way you'd like them to do, which is in person where I can go through all the steps.

Jim Marous (22:12):

But you also, I think mentioned that that digital account opening process then transcended into the brand became everybody's modus operandi. You didn't have a different system for the branch system than you did on the digital mobile way of doing things.

Dominic Venturo (22:27):

I know we have a lot of folks from retail banks that are here and also will listen later so I want to talk about that for a minute. One of the things that we began doing as part of the digital organization a number of years ago is to build an interface for what we call the banker experience that is basically the same interface that the customer uses.

Dominic Venturo (22:50):

And we used to have a platform for this and a interface for that, and a tool for this or that and so, just to keep it simple and we started with new account onboarding but now we're using it in the servicing center and other areas. And so, when the banker logs in, because they have different permissions, they can do different things but it's actually the same experience.

Dominic Venturo (23:13):

Now what's cool about that from my chair, is that that means that I can reuse the code and the engineering and all of the work, and I don't have to now maintain six different systems and if I change something that affects this one over here, I don't have to go do all of the dependency reliance on when I deliver, I got to wait for these guys to keep up and the like, because we contain it all in one place and that's very powerful. So, that's a big deal, especially in the retail environment and in the call-center environment.

Jim Marous (23:44):

So, as you mentioned, that was five year back, things have happened so fast. I think you probably still remember what it was like, and you'd not worked in a small organization for quite some time. But the reality is, the way you did things at US Bank wasn't too unlike what many organizations are doing today in the marketplace.

Jim Marous (24:03):

So, we have a lot both on listening to the podcast and live today that are the $10 billion or smaller organization. I'm going to take you for a second and place you in one of those organizations and you can make up where they are in that process.

Jim Marous (24:19):

But when we talk about resilience, when we talk about a resilience in the way of being prepared for the future to make it where you don't have to backtrack to go forward, or where you can actually be ahead of where the consumer, where the small business, where the government is, what would be the first thing that you'd be looking at to fix to get you new position to go to the next step?

Dominic Venturo (24:43):

Well, I mean, the first thing I would have is an organization that is focused on the product development. So, I hate to keep it that simple, but the reality is-

Jim Marous (24:52):

New product development or enhancements on their existing products?

Dominic Venturo (24:56):

Well, I think, so it depends on what the priority is of the company and new product development isn't the top. It is an important competitive thing but a lot of times we're talking about feature improvements, we're talking about experience improvements.

Dominic Venturo (25:11):

And so, if you have product owners that think like a product owner of this and understand that they have to build the telemetry, the signals, the information that gives them good insights about what they should change next, that's the next piece.

Dominic Venturo (25:26):

So, it's one thing to have a product person, then it's the second thing to say, “Well, I need data-driven decision making,” so that it isn't the most important person in the room deciding what to do next and sometimes they're very brilliant and they have great ideas and sometimes the data doesn't bear it out.

Dominic Venturo (25:41):

So, you have the ability to make data-driven decisions which will help you with the business case, the prioritization, the justification. Now your development or our development doesn't always have to be completely in-house.

Dominic Venturo (25:53):

And I know that a lot of especially the smaller banks rely on either a core processing vendor or a card platform vendor and the like, but the reality is those companies are also innovating and continually bringing new capabilities to market.

Dominic Venturo (26:08):

And one of the challenges that I hear from smaller financial institutions, and we have quite a number of them that are partners of the bank so it's not like we don't get sort of this visibility. One of the challenges I hear is it's hard to keep up with the changes on our bank side with what the vendors are offering.

Dominic Venturo (26:28):

So, they have capabilities, and want to be able to bring them into the bank but it's difficult to do the change management, it's difficult to do the risk management, it's difficult to do those things. So, part of the solve in a product organization is then to say bring risk, bring compliance, bring technology in and develop a prioritization model that allows you to be able to chip away at those capabilities and be able to bring them to market and then really measure the results of those changes.

Dominic Venturo (26:55):

Because the more you do that, I'm pretty confident that the results will then create the empowerment that says, "Let's do more of that. That's a good thing. I saw that that had good impact on deposits, that had a good impact on account opening, that had a good impact on customer experience. We like that. We want to do more of that."

Dominic Venturo (27:12):

And you'll start to find those areas where you can turn it into more of a rhythm and a process as opposed to this big project, then it's done. Then I go get a team and look at the next big project and that's just a very difficult way to manage it.

Jim Marous (27:27):

It's interesting because we've had a lot of people that have spoken on the stage from the Forum X thing that have talked about things like break it, test and be willing to let go of it. How you communicate with customers and again, these all kind of roll up to that, number one, know what your North star is and it can be on a project basis. If you don't know what your North star is, you won't get there.

Jim Marous (27:48):

And I keep on emphasizing it because I think it's something I'm hearing more and more in the podcast, leadership. It's interesting because the first thing you went to, it's not what I'm going to fix in the back office. It's the person I'm going to put in place to make it all happen and it is a people business and the communication process.

Jim Marous (28:06):

I think what's also interesting, Dom, is that as we look at what's going on in the marketplace today, the good news is we have a lot more partners we can use and they are more willing to play together. We were talking about it at lunch that I think it was 2019 at this event that we started seeing vendors, talking to vendors about how to work with each other, not on a competitive basis, but on a cooperative basis where if you're going to fix the data, then I may use your data fixes for my solution and I think that's important.

Jim Marous (28:35):

When we look at what's in the future, and we'll talk about AI next, but when we look at what's in the future, what are you preparing for from a resilience standpoint? And it may just be, I don't know what I'm preparing for because that happened yet, but what are you trying to make more resilient within US Bank in the context of everything?

Dominic Venturo (28:58):

Well, I think I don't know that I would say that it's more resilient but the pace and change in this industry isn't going to get any slower. The external influences we can't control. So, part of what we have to do, I mean, I guess if you want to stay sane, part of what you do is don't pay too much attention to the things that you can't control but prepare for the fact that things will happen that you can't control.

Dominic Venturo (29:24):

And I'll use an example. We saw as an industry a pretty significant change when we had the failure of SVB and the other banks. We had sort of the crisis of deposits for lack of a better description and then we saw the environment change pretty rapidly and some of the other things that were happening at the time, yield curve was changing, interest rate dynamics and the like.

Dominic Venturo (29:48):

But the underlying thing then meant we all had to change. We had to make it easier to be able to attract deposits, we needed to make it easier to be able to combine up where it made sense products and value propositions in order to make those economics work and a lot of that had to happen at a very rapid scale.

Dominic Venturo (30:07):

So, part of the resiliency is understanding that you're never going to predict that failure and that cascading set of events. If you are, you're at a good place because you're in Vegas and you should go make a whole bunch of money but none of us are very good at that. But what we can do is organizationally be prepared.

Dominic Venturo (30:27):

And part of the foundation that we needed to be able to build as a company, which we've been on that journey for the last six or so years, is modernizing the architecture, modernizing the systems where we can, moving to cloud native applications in the digital space, changing the software development lifecycle, changing the product development lifecycle, and then enabling the organization at enterprise scale to be able to adapt to, “Okay, the agenda changed, now we're going to focus on this,” which we do and deliver.

Dominic Venturo (31:02):

If you look at our bank smartly checking accounts moved to savings account, then it moved to savings plus a rewards product with the credit card, part of that was adapting to the market conditions and being able to have an attractive collection of products that are able to be delivered and we delivered some of those in months from the world change-

Jim Marous (31:23):

I'm sorry, you've been in banking long enough to know-

Dominic Venturo (31:24):

We have to be able to do that.

Jim Marous (31:25):

That used to be an annual planner not too long ago.

Dominic Venturo (31:28):

Used to be actually 18 months. Because you do your financial planning, then you do your product planning, then you do your engineering, then it would take 18 months and by the time you built it, it was too late, and you were already behind because the world around you delivered things in months but we could do that.

Dominic Venturo (31:47):

And we could do it because we changed the technology stack, we changed the environment, we changed the delivery model, and we changed the way the organization thinks about planning and agility.

Jim Marous (32:01):

So, as we look at the future it is amazing in my mind to think that generative AI didn't raise its head until November 2022 and it's not even November of 2025 yet, it's truly overnight. It has gone from, it can answer an interesting question a little bit better than Google to now it can create visuals, video, dynamics, personalities based on all that.

Jim Marous (32:30):

That is something you have to get prepared for without knowing exactly where it'll go or where US Bank may want it to go. How is that changing what you're doing? But more importantly, right now, how does AI make an organization of any size more resilient? And I'm going to take the opposite of that, how does in some ways make it less resilient?

Dominic Venturo (32:55):

I think I'm going to try to do those in order. I mean, so first of all, generative AI is a big deal, I'll grant it that. Part of what, and it's probably obvious to everybody, but part of what makes generative AI a big deal is because, number one, the amount of information that is in the training data that is available for its knowledge base.

Dominic Venturo (33:20):

There were technological advancements that had to happen to enable that breakthrough and part of that was enabled by cloud, part of that was enabled by network infrastructure improvements and the speed at which we can communicate between where we are and where the cloud is and so that convergence sort of happened and then the lightning struck and you saw ChatGPT was born so that now is an artifact of the future because it is part of what we will have.

Dominic Venturo (33:51):

But artificial intelligence and banking has actually been part of what we've done for quite a number of years. Advanced machine learning models then there was the transformer architecture and Burton and the like that came out of Google DeepMind and the like, and there were some really advanced capabilities that came out of that that you don't hear anything about these days because everybody talks about generative AI but those were really powerful engines.

Dominic Venturo (34:16):

They allowed us to do things like advanced image analytics and check processing and fraud, they allowed us to do things like network detection, not the internet, but networks of actors in things like fraud prevention, crime management, financial crimes, human trafficking and the like and these sound like not very sexy things, but there's a lot of money in the banking system that gets lost through fraud, crime and the like.

Dominic Venturo (34:44):

And so, there's been a lot of really, really important work that has gone on there that doesn't get tons of publicity and that was sort of AI. Generative AI comes along and I talked about a couple of things that made it a game changer, the last of which is the natural way that we can interact with it.

Dominic Venturo (35:02):

You no longer have to be a data scientist and a machine learning expert into this or that, you can actually just interact with one of these tools and you can ask it questions and you can get answers. Now they may not be right, that's a whole nother topic but importantly, those found what we call foundational models are pretty easy to train.

Dominic Venturo (35:23):

So, let me explain. You start with an open-source large language model, and then you train it in your environment on a knowledge base, a set of information, guess what banks are really good at, banks and credit unions, documentation. We have policies, we have documents, we have knowledge bases, we have tons and tons of rules, all of those rules are amazing tools to train a generative AI engine.

Dominic Venturo (35:51):

So, we take this thing that is general knowledge and then we give it very specific training and then we tell it because you have to, you're only allowed to work within the rules we gave you so you can use the other knowledge to communicate like a human communicates but we want you to stick within the answers of those that we have trained you on.

Dominic Venturo (36:13):

So, you're taking general, making it specific and then you can create those and start to create those for very specific use cases. General banking, call center for customer service, for support to be able to get to the right answer more quickly, not have to read through the policy and the like, just give me the answer and allow me to answer the customer's question.

Dominic Venturo (36:33):

Fraud, fraud analytics and detection and the like, and the experts that do that to pre-prepare sort of case management and other sorts of activity, they're on and on and on kinds of applications. But banks probably aren't going to build a large language model because that takes an enormous amount of money and compute and power and the like and there's not really a business case to do it or a need, but being able to leverage those capabilities and then build agents or agentic solutions that allow us to deliver against that will be, I believe part of the future.

Jim Marous (37:05):

The ultimate personalization.

Dominic Venturo (37:08):

And yes, so within the ability of this dream of one-to-one personalization, which has always been very complicated to do, a lot of the reason that that has been very difficult to do is because the data's always dated. The data are always dated by definition because it's last month's transactions or it's whatever.

Dominic Venturo (37:28):

When you have these models running at machine speed and you can actually do real time detection of changes in behavior, then you can provide a useful alert, you can provide an insight, you can alert the fraud team, there's a whole host of things that you can do.

Dominic Venturo (37:45):

The very last thing that I want to say on this is that generative AI is really, really good at, is taking unstructured data. So just imagine, oh, so unstructured data, if you're not familiar, is just not a database.

Dominic Venturo (37:57):

So, financial statements, tax returns, people put them in different forms, other information customers might give us an offer letter for a piece of real estate, another good example to take that unstructured data to understand the intent of the data, what is this document and what's it for? And then to be able to accurately extract that data and then put it in a system for processing.

Dominic Venturo (38:22):

So, if you can do those things and you chunk up bodies of work that you have within your institution, you've just created tremendous operational efficiency. Because I don't have to do swivel chair, I don't have to do key entry, I don't have to do anything. All I have to do is review it and make sure it's accurate and then post it and generative AI-

Jim Marous (38:41):

You're doing these at the consumer or small business or corporation?

Dominic Venturo (38:42):

Any.

Jim Marous (38:44):

Doesn't do a real good job at but we can actually, because of your skill, computerization cloud, everything else, you can actually do that on behalf of the customer.

Dominic Venturo (38:52):

That's exactly right. And some of the biggest opportunities in banking in my view are not very sexy. But because they happen and thousands of people do them and it's lots and lots of work to be able to do it and it's not what I would call higher order human processing.

Dominic Venturo (39:11):

And so, when you free that time up, you then allow them to actually work on things that are challenging and are engaging in value adding, whether that's while I'm talking to the customer about their needs and goals, instead of looking up a policy or an answer to a question or whether it's I'm going to go spend time more accurately working on this thing or that thing, building a strategy, et cetera, because I don't have to do the other work.

Jim Marous (39:37):

So, finally, I had two different ways I wanted to go, one was what excites you about the future? But the one I really want to ask is, you're at I think number five as far as size of assets but there's a big difference between number one and number five, there's even a bigger difference between number five and number 3,740.

Jim Marous (39:55):

Part of the resilience is how do I make it so my organization is always going to be able to compete for the consumer, for the customer in a really aggressive way without being aggressive. When you look at that resilience in that way, what is US Bank doing to differentiate itself and make it more resilient in the broad sense of the term?

Dominic Venturo (40:18):

So, you heard a lot of the things that we've been doing in a number of spaces but let me try to bring it together. We've been on a mission for a number of years to be able to digitally enable just about anything that a customer wants to do with us.

Dominic Venturo (40:36):

And this is going to sound like a small thing, but the reason it's a big thing is because part of our delivery model with the customer is to be able to give consultative advice, to be able to give personalized service, to be able to give that human touch and that's part of our sort of mission which is we put people first and we're really trying to power the potential of humans.

Dominic Venturo (40:58):

But in order to do that, you have to get a lot of the busy work out of the way and you have to allow a customer to just get stuff done that they can do either on their own or with customers. We do co-browse, and we don't force people into a channel, but the whole reason that we're on that journey is we then free up some of that time and that allows us to then spend time on the value add and the purpose.

Dominic Venturo (41:20):

Now every bank is going to have a different lens on what they think their purpose is or what they think the value contribution is that they do. So, the important thing is to say, find the things that distract you from your purpose and get rid of them.

Dominic Venturo (41:34):

And I don't mean don't do them because it might be like risk management so it's pretty important. But find those things that are not allowing you to do the thing that you think does differentiate from you and if you can automate them, if you can simplify them, if you can do that-

Jim Marous (41:48):

Find a partner that can do them.

Dominic Venturo (41:49):

This is like the account opening. Take away all the fields and only put back the ones that matter. So, then you can focus on the things that matter that differentiate you from the competition and allow you to exceed in the area that you want to.

Jim Marous (42:03):

Dom, it is always a pleasure to meet with you. I always learn a lot, always get a sense for where banking can be. I would suggest to the audience, the people that are watching the podcast continue to investigate.

[Music Playing]

Jim Marous (42:17):

You have ways now with ChatGPT to say, “What is US Bank doing in the resilience field? Or how are they addressing X, Y, or Z issue,” that you may be addressing all the time because they're a good model to follow. They're not a big bank in the judicial big bank way.

Jim Marous (42:33):

They're a Midwestern organization that's grown over time, but it's grown because of the innovation, the product development, the looking out for the people, not just the consumers, we didn't talk much about it, but the internal people as well.

Jim Marous (42:45):

The culture is something unique from an innovation standpoint, but I think the most important takeaway is I hope that everybody realizes that the definition of resilience is the founding component that right now we need to work towards as an industry because of the fact that the world's changing so fast.

Jim Marous (43:04):

Because we don't know, we just have to look at the last couple weeks to realize the whiplash that goes on and you don't know what's going to come up next and that's not a political statement, that's the world today.

Jim Marous (43:16):

And because we're in a global environment, we may not have control over that going forward. So, how do we put ourself in a place that we can respond to things we don't expect. Dom, thank you so much for being with me again today. I hope the audience appreciates it. Thank you.

Dominic Venturo (43:32):

Great to see you, Jim. Thanks for the time. Thanks everybody. Have a great rest of the conference.