When İşbank embarked on the journey to design a daily banking experience for the next generation, it entered a highly competitive sector with over 600 fintechs vying for the attention of the exploding market of young, digitally savvy customers. A dedicated team was assembled and tasked with developing a banking app within just six months. And they delivered! Just three months into the pilot launch, the app managed to attract one million registered users. Within a year, Nays became the fastest-growing banking app in Türkiye, with over four million downloads and three million registered users. Ceyda Yalçın, the Nays app leader, sat down with McKinsey’s Andrew Roth to discuss the winning formula of Nays – cutting-edge technology, a gamified banking experience, and a value proposition that delights customers through simplicity, fun, and rewards.

Origins and Market Challenges

The Turkish financial sector is undergoing a massive transformation driven by technology and innovation. İşbank faces a vibrant and diverse fintech ecosystem that offers new and convenient ways to manage money. These fintechs appeal to millions of customers, especially the young and digitally native ones who expect simple, easy, and transparent banking solutions. Türkiye has over 600 fintechs with a record-breaking investment of $89 million last year. The competition is fierce, and regulatory restrictions on know-your-customer (KYC) processes and digital marketing activities pose challenges. However, Türkiye also has a large young and digitally savvy population with over 45 million people below 35 and a 70 percent smartphone penetration. There are over 85 million mobile bank accounts, with over ten million digital accounts created annually. Young customers want easy, simple, and user-friendly banking solutions.

Vision and Goals

The team had a clear vision from the start – to lead the market, design the next-generation daily banking experience, become the biggest player, and acquire millions of customers. They shared this vision with the board, along with value propositions backed by customer tests and benchmarking. A new brand, Nays, and a new app for daily finance were created, focusing on simplicity, fun, and rewards. The team aimed to become the fastest-growing daily finance app in Türkiye, reach millions of new-generation customers, integrate with popular platforms, and achieve more than ten million downloads and four million active customers by 2027.

Initial Challenges and Milestones

The launch of the first minimum viable product (MVP) in late 2021 was a challenging test period. The load on new systems was high, and new features were being developed for the official launch. Despite the challenges, they reached their year-end target of one million registered users in only three months during the pilot launch. This required confidence, courage, determination, and resilience. Demonstrating high standards of performance and problem-solving was crucial during this turbulent time.

Key Features and Customer Attraction

The hassle-free onboarding process with no hidden fees or conditions was a major attraction. The user-friendly interface made it easy for users to manage their daily banking and shopping. The cash-benefit program with cashback and gamified incentives was very popular. Exclusive deals and discounts on digital platforms also added value. Extensive customer research showed that customers valued free money transfers, easy access to loans, gamification, and attractive campaigns.

Marketing and Growth

Word-of-mouth and a referral campaign worked well to publicize Nays. Customers promoted the app on websites and created videos. The addition of the microcredit feature and advertising activities, including using a celebrity and television/radio campaigns, led to rapid growth. Nays became the fastest-growing finance app in Türkiye, with over four million downloads and three million registered users in 12 months. Twenty percent of users were new to banking and under 35, attracted by the unique experience.

Future Plans

The future holds big plans for Nays. They aim to offer more features, benefits, and value, creating value beyond conventional financial practices. They want to deepen their presence in the ecosystem with easy payment and borrowing options using a digital prepaid card. Integrating loyalty programs of business partners is also on the agenda. Nays has strong growth and revenue potential, with a digital asset already valued ten times the investment. They plan to evaluate spin-off options soon.

Attracting and Retaining Talent

Building Nays was a team effort involving technology and business partners. A culture of innovation and collaboration was fostered. Agile management practices were implemented, and teams were empowered to take ownership. Data-driven decisions were made to gain trust and support. The quality of execution, autonomy, and intense stakeholder management were the pillars of success.

Leadership and Data-Driven Culture

Learning from the team and leaders along the way, Ceyda Yalçın emphasized the importance of being in touch with the team, having one-on-one conversations, and listening. Seeking different perspectives before making decisions was crucial. Dashboards were used, but the focus was on the culture. In problem-solving, facts and data were examined to ensure customer-centricity. While being data-driven, a balance was maintained as trusting gut feelings was also important in times of crisis.

The post-COVID-19 era has brought significant changes to the supply chain, creating lasting fissures. Amidst the backdrop of increasing globalization, rising customer expectations, and double-digit shipping growth, supply chain organizations are under immense pressure. They face challenges related to operational efficiency, demand forecasting, inventory management, and fulfillment across various industries such as retail, technology, automotive, and more. This complexity has led to stalled growth and missed revenue opportunities.

Unlock the Potential of Digital Twins in the Post-COVID Supply Chain

Digital Twins: The Key to a Resilient Supply Chain

Under these challenging circumstances, organizations that fail to recalibrate their supply chain operations risk being left behind. Digital twins offer a solution by helping with the necessary recalibration. Leading companies are already leveraging them to ensure their supply chains are flexible, agile, and responsive enough to overcome unexpected disruptions.Digital twins are virtual replicas that use real data to simulate potential situations and deliver analytical insights. They can be used to model the interaction between physical and digital processes throughout the supply chain, providing a clear picture of an optimal end-to-end process. When paired with predictive AI, they become both predictive and prescriptive, leading to a self-monitoring and self-healing supply chain.For example, a retailer uses digital twins to set dynamic SKU-level safety stock targets for each fulfillment center, adapting to localized and seasonal demand patterns. This granular optimization extends to every part of the end-to-end supply chain, resulting in significant improvements such as a 20% improvement in fulfilling consumer promise, a 10% reduction in labor costs, and a 5% revenue uplift.

Digital Twins and SCM Software: A Perfect Match

Today's supply chain management software has automated many parts of the supply chain. Digital twins can integrate with these existing tools, functioning as an innovation layer on top of the tech stack. They optimize data inputs into SCM tools, generating predictive analytics to address multiple potential scenarios.For instance, a global OEM created a digital twin to optimize its outbound logistics policies in the TMS platform, reducing costs for freight and damages by 8%. Digital twins help in several ways, such as providing end-to-end connections, enhancing resiliency in dynamic markets, optimizing across competing priorities, and testing for variability.An automotive OEM used digital twins to dynamically shape demand based on supply availability and operational complexity, reducing last-mile transportation costs by 5%. A consumer-packaged-goods company measured variable demand and labor in its warehouse and reduced total distribution center costs by 15% using digital twins.

A Deep Dive into Digital Twins

Seeing digital twins in action is crucial to understanding their value in the supply chain. Let's explore some potential use cases:- **Forecasting and Demand Planning**: Two people analyzing various charts and graphs symbolize data analysis and strategic demand planning. Digital twins help predict demand accurately.- **Sourcing and Production Planning**: An isometric illustration shows a streamlined sourcing, manufacturing, and logistics process using digital twins.- **Optimizing Supply**: The distribution center network is illustrated with lines representing the flow of goods and inventory levels. Digital twins optimize supply throughout the network.- **Distribution Center Network**: Data streams between distribution centers show the efficiency of the network. Digital twins play a vital role in optimizing this network.- **Network Design**: The design aspect is emphasized, highlighting how digital twins contribute to an efficient supply chain network.- **Inventory Management and Positioning**: The importance of inventory management is shown, with digital twins optimizing inventory positioning.- **Warehouse Optimization**: The warehouse is optimized using digital twins, improving overall operations.- **End Customers**: The flow of packages and data between the warehouse and customers highlights the significance of digital twins in fulfilling customer orders.- **Fulfillment**: The fulfillment process is enhanced with digital twins, ensuring timely deliveries.- **Reverse Logistics**: The reverse logistics process is also optimized with digital twins, reducing costs and improving efficiency.

Understanding the Benefits of Digital Twins

Supply chain organizations are leveraging digital twins to optimize both long-term strategies and everyday operations. The most common uses include inventory positioning and forecasting, managing the flow of goods within warehouses and factories, and aiding in production planning.Strategically, digital twins can derisk long-term planning by simulating potential outcomes. For example, a retailer used a granular digital twin to test the implications of a new distribution center design and found they could resize and relocate it on 50% less real estate without compromising functionality.Operationally, digital twins act as a "one model to rule them all," optimizing daily decision-making. The same retailer used its digital twin to optimize cross-dock footprint and daily inventory positioning decisions, resulting in a 10% improvement in regional distribution center utilization and a 5% reduction in fulfillment costs.

Getting Started with Digital Twins

While supply chain organizations recognize the value of digital twins, few have implemented them at scale. Digital twins often require a customized build, which takes time and investment. Organizations need in-house data science and development teams or partner with outside vendors.To succeed, organizations should focus on five key tenets:- **North Star Road Map**: Determine the vision for the future supply chain and prioritize end-to-end use cases.- **Data Visibility**: Identify data inputs and outputs for each use case and build a data product road map.- **Technology Architecture**: Ensure the tech team has the flexibility to scale compute resources as needed.- **Talent**: Assess the skills needed and provide agile upskilling and training.- **Optimization and Simulation**: Identify the first use case and build optimization and simulation modules.End-to-end supply chain optimization requires a mindset shift at all levels. Internally, companies should eliminate silos and rely on data-driven decision-making. Externally, they should analyze their roles in the global supply chain. Digital twins can help predict potential disruptions and enable companies to react and adapt.