Digital revolution has come in waves. The first heralded the spread of the internet and then its ubiquity. This allowed the growth of social networks, instant news and global reach transforming the way we communicate, the way we shop and of course the way we bank. Then came the increase in bandwidth transforming the way that we now buy and stream things like music and television.

But maybe the biggest digital innovation to change our lives has been the smartphone, so important that it is increasingly replacing our wallets and purses, our watches and diaries.

When someone loses their phone, they rarely bemoan the cost of replacement; instead they anguish over the photos, music and even the way they had customised their phone with apps for every aspect of their lives.

On the business side, the smartphone has created an m-commerce culture where success for retail businesses relies on tailoring the customer experience for every customer.

The whole digital conundrum – m-banking in particular – has a lot of the big banks on the back foot. And it’s hardly surprising. Most of the large banks have spent the past five years focused on Conduct issues, regulatory compliance and shoring up creaking legacy systems.

Building a digital model on the front end of core systems that were built when the latest hit was more Uptown Girl than Uptown Funk was never going to be an easy task. However, this is a dangerous place for banks and they need to be mindful of lessons from other industries.

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Take retail. Digital revolution claimed casualties that we once thought of as impregnable bastions of the UK high street. Napster and then iTunes were windows on a future that HMV ignored and denied – and it paid the price for digital denial with a collapse into administration.

So the story goes for Amazon and Borders and so many more retailers. Look at the utilities industry. Even the big six energy companies are starting to haemorrhage customers to challengers such as Ovo and First Utility, emboldened by the access and marketing potential of the digital landscape, as well as the unique customer engagement opportunities.

Creeping up on the banks are the banking equivalents to Napster or iTunes – banking is no more immune to digital disruption than music retail.

The problem for the banking sector, is that cash has been in short supply for major transformation – and understandably so. The global financial crisis crystallised major losses for the banks and eroded capital ratios that simultaneously had to be raised to comply with Basel 3. Billions had to be paid out to settle Conduct issues such as PPI and Libor and continue to be provisioned. As a result, all change has had to have a bullet-proof business case with a quick return on investment.

This has predominantly led to short, sharp pockets of change rather than anything particularly groundbreaking. It might involve redesigning the front end of a digital app or bolting on a new payment capability. Speeding up operations or automating to reduce headcount. All perfectly worthwhile but if that’s your entire strategy, it’s ultimately like scooping buckets of water out of the hull of the Titanic.

Customers don’t want bite-sized chunks of digital transformation. They have a voracious digital appetite that needs to be whetted. As millenials and digital natives get older, they will expect to be able to use their phones to check the detail of their banking portfolios – their latest mortgage status, key stats from their ISA portfolios, negotiate an overdraft extension or check credit card outgoings.

Are the big banks there yet? Not by a long stretch. Legacy systems are the millstones around the necks of the big banks in more ways than one – they are a massive inhibitor to digital transformation.

The time has come – transform, don’t just change. Go big or go home. We can roll out the bumper sticker slogans here, but the opportunity is clear. Now is the time for major banks to leap ahead of their rivals – they need to clearly assess the tech landscape, ascertain what customers want now and in 10 years time and, using cutting edge fintech and technologies like the Cloud, put the innovation engine in place to build something dramatic and truly transformational.

Find the best minds in your business and beyond and give them the space and freedom to imagine a future unencumbered by legacy issues – and then give them the cash and the time to deliver that major transformation as a holistic programme creating the future of banking within your walls.

Maybe, just maybe, it might be the first step on the path to securing another century of market dominance. The alternative? Ask HMV.

Martin Dempsey is a client director at business change consultancy Certeco