The digital transformation from the Internet and mobile computing to cloud computing, big data, the Internet of Things, and artificial intelligence, known as the fourth industrial revolution, has brought a large number of technological innovations to the financial industry and also sparked a wave of digital transformation in financial institutions. Unlike the past, which has achieved effective data storage and reading, established a comprehensive data management platform, and achieved data integration and integration, the digital transformation of financial institutions is an upgrade based on the data platform, establishing a complete data management, governance, and utilization system, combining the latest data technology with financial business application scenarios and customer actual needs, achieving data intelligence, fully utilizing data to generate business value, and driving business development, Achieve the ability to operate data assets in a data-driven and data-driven manner.

Technology is a booster for the transformation and development of financial institutions. Looking back at history, it can be found that the development and transformation of banks and other financial institutions are largely based on the iterative updating of technology. Compared to financial institutions such as banks, securities, and insurance, financial companies, as a niche category of financial institutions, invest relatively limited funds and human resources in information technology. The early development of the industry mostly relied on traditional financial management software suppliers for business systems. In the past decade, leading companies in the industry began to build their own business management systems. It was only after regulatory authorities linked data governance with regulatory ratings in 2018 that the financial company industry increased the importance of data governance as a fundamental construction work.

For a long time, regulatory authorities have been referring to banking financial institutions in many aspects of managing financial companies. It can be foreseen that in the future, financial companies will actively invest various resources to upgrade their data management capabilities, solve data quality problems, and proactively respond to the challenges brought by the scale of data growth, complex structural types, scattered data distribution, and diversified scenarios for financial company data transformation.

However, at present, there are still several shortcomings in the digital transformation of financial companies. Firstly, most financial companies adopt the strategy of imitating and following top institutions in the formulation of digital transformation strategies, and to a certain extent, lack consideration for the operating characteristics of their industrial groups and their own customer characteristics. Secondly, in terms of organizational structure support for the digital transformation of financial companies, creativity and agility are constrained. Due to the pyramid shaped hierarchical structure, the digital line is still relatively disconnected from the front, middle, and back office lines, making it difficult for employees to collaborate across lines. The decision-making process is also limited to a series of interconnected models, resulting in slow efficiency. Thirdly, financial companies have relatively weak digital infrastructure capabilities, with a relatively late layout in digital infrastructure construction. Their understanding and utilization of data value are lagging behind, resulting in inconsistent data quality and lack of standards; The distribution of data in various lines and departments is scattered, lacking integration mechanisms, unclear data governance structures, lack of established data control mechanisms, insufficient data analysis and application capabilities, and insufficient computing power construction. The foundation is weak in mining data value and building data application scenarios.

Digital transformation is the trend of the industry. The author believes that taking the "three new and three modernizations" as a complete ideological system and implementing it in the digital transformation practice of financial companies through a systematic engineering organizational approach and mechanism can maximize the guarantee that the digital transformation of the industry will become a new starting point for high-quality development of the industry.

"Three New and Three Modernizations" refer to "new ideas, new technologies, new foundations, as well as standardization, localization, and simplification". The planning of digital transformation requires "three innovations", which determines the strategic connotation of digital transformation; The implementation of construction and application requires "three modernizations", which affect the operational presentation of digital transformation.

"New ideas" is a continuous process in which financial companies adhere to the original intention of "financial benefits for enterprises", take digital thinking as the guide, improve the cognitive height and thinking depth of digitalization, use digital technology to bring changes to various aspects of company management, improve the efficiency of financial services for member units, and enhance the efficiency of group treasury management. The "Management Measures for Financial Companies of Enterprise Groups" released at the end of 2022 guide the industry to focus on its main business and return to its roots. The digital transformation of financial companies should also comply with regulatory requirements, focusing more on the strategic goal of empowering themselves through technology to become the best carrier to undertake the functions of group treasury.

"New technology" specifically refers to the "ABCDI" of the digital economy, which refers to the large-scale application of new technologies such as artificial intelligence, blockchain, cloud computing, big data, and the Internet of Things. At present, new technologies such as RPA digital employees and letter of credit blockchain service platforms have been introduced in different business lines within the industry. In addition to these point-to-point applications, the digital transformation of financial companies also needs to be based on autonomy and controllability, promoting the transformation from traditional centralized IT architecture to distributed architecture, in order to cope with the increasing number of high concurrency scenarios and break through the "ceiling" of vertical expansion.

The "new foundation" requires financial companies to closely monitor business technology linkage and strengthen business data governance. Financial companies should attach great importance to data governance and establish integrated teams for long-term and sustainable governance; To sort out and establish a digital dictionary, data labels, data indicators, and data list that are suitable for the company's business, and form a standardized and structured data model; To establish a digital management system for the entire process of data collection, storage, analysis, mining, and application, and to improve data quality in data recycling applications, it is necessary to clearly recognize that data governance is the top priority of digital transformation.

Standardization includes financial technology standardization, software development standardization, data element standardization, network security protection standardization, etc. Its purpose is to achieve industry and cross industry leveling, which is also the financial company industry has been calling for the upgrading of the financial ecosystem. The implementation of digital transformation is the process of leveling and connecting individual institutions, financial systems, and industrial ecosystems. The continuous deepening and upgrading of standardization should form a feasible pace of standardization evolution and supporting arrangements from the perspective of industry granularity, which may require regulatory authorities to coordinate and arrange.

Localization is closely related to the security of digital transformation, and it is necessary to balance transformation efficiency, technological ecological construction, and technological autonomy. In recent years, financial regulatory authorities have elevated the importance of network security, data security, and privacy protection to unprecedented heights, building data security capabilities throughout the lifecycle of data generation, collection, transmission, storage, use, sharing, and destruction, and requiring the implantation of localized genes at the technological bottom.

Simplification highlights the soft competitiveness of digital transformation. The digital transformation of financial companies should be able to convey the emotional warmth of serving the group, and also reflect the financial goodness, allowing financial vitality to drip into the real economy and practicing the transformation of inclusive finance. The digital transformation, which is customer-oriented, user-friendly, easy to access, and highly efficient, will better serve the overall development of enterprise groups.

Overall, financial companies need to accelerate their digital transformation, seize the time window, release new development momentum, promote a virtuous cycle of economy and finance, and help stabilize the macroeconomic situation.

(The author is a senior economist at Guangdong Energy Group Finance Co., Ltd.)