Intro

Many corporate services are beginning to be converted into mobile apps. This is what is known as an “O2O
(online to offline) service.” The expansion of O2O services has replaced a world of offline stores, in which
work was done face-to-face, with a cyber world in which everything is done online and in a contactless
manner. Things have evolved to the point that those in their teens and 20s (the “digital native” generation)
are more comfortable with contactless than face-to-face communication. It has produced many new
services as well as the extinction of others. As such, recent changes in the digital environment are
demanding that companies change and take on unprecedented challenges.

What is Digital
Transformation?

How are our companies honing their competitiveness in new areas amidst all of these digital changes? Recently, many global corporations have begun using digital technologies (AI, big data, blockchain,
robotics, cloud computing, etc.) to increase customer value, make work methods more efficient, and
pioneer into new areas of business. “Digital transformation” (DT) is the term used for this phenomenon—
using digital technologies to innovate existing work methods or customer value and /services. In general, DT in the financial sector is, essentially, referred to interchangeably with “fintech.” In finance, DT
is the evolution of the blend of finance and digital technology. Fintech, a compound word from “finance”
and “technology” (usually, digital), is understood as “digital technology that can be applied to areas of
finance." With the continued emergence of online-only banks and mobile payment service providers,
traditional finance firms are intent on developing new areas of competitiveness around these digital
technologies.

Digital Transformation

In general, digital transformation in the financial industry is used similarly to fintech. If digital transformation in the
financial industry means 'finance meets and evolves with digital technology', Fintech is a compound word of 'Finance +
Tech(technology, mainly digital technology)' and can be described as 'digital technology that can be applied to the
financial sector’. Amid the recent emergence of specialized Internet banks and the challenges of mobile payment service
companies, existing financial companies are also engaged in creating new competitiveness using digital technology.

Future Research

HIT’s DT Lab focuses on three main areas of R&D and strategic planning on its drive for global
leadership in research on finance DT. Ultimately, DT Lab aims to contribute to HFG’s complete
digital transformation.

No. 1
worldwide:
Finance DT research

Digital Transformation

01 Business

02 Process

03 Service
& Product

DT:
Mega-trends

• · Trends in digital technologies
    (AI, big data, etc.)
• · DT strategies for finance industry, examples
    from global corporations
• · Finance biz/processes, evolution of
    services and products

DT:
Technology
strategy

• · Research and project planning for
    DT roadmaps
• · Research on DT’s effects on economy
    and industries

HIT strategies/
operation

• · Management of DT Lab’s mid/long-
    term vision and outcomes
• · Operation of DT Lab’s HR strategy and
    research infrastructure

The first research area is DT megatrends. This involves studies on trends in digital technologies (e.g. AI, big data)
that are evolving practically every day, as well as how global finance firms are using DT to produce meaningful
output. Research in this area also aims to predict how finance in the future will have changed to create a blueprint
of DT-based future business and processes and services and products from the finance industry. Second, research on HIT’s technology roadmap is used as the basis for planning technology-related projects, while
predictions are made of how the technologies currently being researched can potentially influence HFG’s profit
structure or customer base. Various tools are used for this area of research, including technology roadmap
methodologies and technology profitability analysis. Third, HIT aims to use its mid- to long-term vision and outcome management for DT Lab to become a research
center that can lead HFG’s digital transformation. Furthermore, multi-faceted measures are taken to improve HIT’s
research environment to help researchers focus better on producing outcomes in a creativity-inducing atmosphere. In these ways, HIT’s DT Lab aims for recognition as a world-class research center and global leader in finance DT.