When Arvest, a regional bank operating in Arkansas, Kansas, Missouri and Oklahoma, hired Laura Merling as chief transformation and operations officer in 2021, one of the first things she changed was its digital transformation plan.\n\nThe 60-year-old bank, formed from the successive mergers of 14 regional banks, was planning to launch a neobank, an online-only service with national ambitions, as a way to ensure its future growth.\n\nWhen Merling arrived in October 2021, Arvest had already begun the transformation process: conducting the first in a series of annual \u201cDriving Change\u201d surveys of staff attitudes and experimenting with the new core banking software around which it planned to build the new bank.\n\nBut there were challenges.\n\n\u201cEverybody was creating a retail neobank,\u201d says Merling. That made for a competitive market in which the cost of acquiring a new customer was around $1,000. \u201cYou\u2019d spend all your money on customer acquisition and not on building infrastructure,\u201d she says.\n\nOn top of that, there was a degree of resistance \u2014 or at least indifference \u2014 to change within the company. Merling summarized the internal survey findings about staff readiness to change as one-third \u201cSure, I\u2019m in,\u201d one-third on the border, and one-third \u201cI\u2019m not really ready.\u201d\n\nIt\u2019s hard for staff to support change when it\u2019s not clear what that change will be, she says.\n\nStudy, study, study\n\nTo get a clearer picture of where Arvest was, and where it wanted to go, Merling\u2019s first moves were to commission one study of the company\u2019s entire tech stack, and another of its data landscape. \u201cWe looked at them in parallel,\u201d she says. \u201cThey\u2019re related but also different: how easy is it to get to the data, and what data do we have?\u201d\n\nAt the same time, she says, Arvest also conducted studies of its vulnerability to customer defection, and of the strengths it could capitalize on to build its new strategy.\n\n\u201cWe did a lot in the first few months I was here,\u201d she says.\n\nThe upshot of all that corporate introspection was a change in direction for the bank \u2014 or, rather, a return to what it had done best before. The plan for a neobank was dropped, and instead, says Merling, \u201cWe set forth a new mission. We wanted to be the leading community-focused bank serving commercial and small businesses.\u201d\n\nThat didn\u2019t mean the bank was turning its back on retail customers. By supporting local employers, \u201cIf you\u2019re successful there, you\u2019ll get the retail as well,\u201d she says.\n\nThat meant building new applications and processes around its commercial loans \u2014 and making some changes to its core IT infrastructure.\n\nA move to the cloud\n\nA few months after Merling\u2019s appointment, the bank announced a five-year partnership with Google Cloud as it prepared to digitize its contact center and move out of its two data centers.\n\n\u201cWe can\u2019t scale and be innovative if we\u2019re just all waiting for on-prem,\u201d she says.\n\nAround this time, the results of the second Driving Change survey rolled in. Some of the transformation skeptics had drifted toward the \u201con the border\u201d middle ground, but in the IT department \u2014 one of the first to see the clear direction as infrastructure changes began to take effect \u2014 resistance actually increased.\n\n\u201cIt was all fear factor,\u201d she says. \u201c\u2018I\u2019m going to lose my job,\u2019 or \u2018I don\u2019t know this technology and I\u2019m not going to get a chance to learn it.\u2019\u201d\n\nStaff comments on the survey showed they didn\u2019t feel their skills were valued, or even known, by management.\n\nThat prompted Arvest to create a program to help staff upskill or reskill. \u201cWe actually borrowed it from one of our partners,\u201d she says. \u201cThey created it for their company internally.\u201d\n\nThe upskilling program, called me@arvest, began in February 2022 with training for the IT team on Google Cloud as the company prepared to move its on-prem workloads there. \u201cWe needed people to know those skills,\u201d says Merling. But creating the next wave of learning journeys took longer than planned. By the time it eventually happened in July, people were getting nervous they weren\u2019t going to get the education, she adds.\n\nThe turning point was a full day of training around Google Cloud in November, with 500 people in the room and another 500 online. \u201cWe had our executives there, the bank presidents, the whole technology team plus,\u201d she says.\n\nInitially offered to the IT team, and later to operations staff, me@arvest will soon open to the marketing department.\n\nAlong the way, Merling decided to hire someone within the IT organization to run the program, which previously ran through HR. This plan enables her to meet the IT team\u2019s skills needs up to ten years out.\n\nA new purpose\n\nOne part of the original strategy Merling kept was the new core banking software from Thought Machine that Arvest had already experimented with \u2014 but now instead of redefining retail banking, it\u2019s underpinning the modernization of the bank\u2019s commercial lending processes.\n\n\u201cWe\u2019re basically rebuilding the entire technology stack for the bank by assuming a banking-as-a-service construct, whether we choose to use it or not,\u201d she says.\n\nBy that, she means drawing on Thought Machine\u2019s cloud-native, microservices-based approach, building new products and services that can be accessed through its APIs.\n\nWith the move to Thought Machine just beginning, the old core banking software won\u2019t be going away just yet, so Arvest is using Google Cloud to deliver a single view of its customers. \u201cIt\u2019s a key part of being able to serve customers going forward,\u201d she says.\n\nMerling brought in external help to stand up Google Cloud, training her own staff in parallel to ensure ongoing maintenance. \u201cThe Thought Machine work we did ourselves,\u201d she says.\n\nUnder her transformation and operations umbrella are the CIO responsible for the existing core software, and the CTO building the new software. The development team was initially small, but is expanding through a mix of new hires and, as people learn new skills, internal transfers.\n\n\u201cMy commitment to them was to make sure to bring everybody along for the ride,\u201d she says. \u201cI didn\u2019t want to create an \u2018us versus them\u2019 situation. That\u2019s super important to be able to grow the bank for the long term.\u201d\n\nMoney talks\n\nIt\u2019s a truism, but \u201c90% of change management is communication,\u201d she says.\n\nTo that end, each month she holds skip-level meetings with the second-level managers in her team, as well as \u201ctransformation talks\u201d where the changes are presented to staff. Alongside the slow burn of rebuilding the banking core, these talks are also a chance to discuss \u201cquick wins\u201d: smaller technology changes that make a difference, such as the recent introduction of pre-authentication for customers calling the contact center. \u201cThat saved a minimum of 200 to 300 hours a month in call time,\u201d says Merling.