12 May Solving Problems through Innovation
Recently, I was involved in a roundtable with mortgage industry leaders discussing technology in all phases of the mortgage process. There were a number of great discussions and insight into technology and its role in the mortgage industry. The one question that triggered numerous discussions and resulted in a lack of consensus among the participants was defining innovation.
The mortgage industry has traditionally lagged behind when it comes to innovation. Slow to migrate off mainframes and DOS based systems and slow to adopt Windows and now web-based solutions. Often times innovation in the mortgage industry has involved taking a manual process and duplicating it in a computer program. While this has created greater efficiencies in some instances, I questioned whether there has there been enough true innovation in the mortgage industry?
As I was pondering this question I saw an interesting commercial for Dyson vacuums. What grabbed my attention was a phrase used in the commercial describing Dyson’s approach to innovation: “Solving Obvious Problems Others Choose to Ignore”.
In researching Dyson, I found that Dyson has a long history of developing truly innovative products. Their founder, James Dyson, developed a flat-hulled high-speed landing craft and, with it, his passion for engineering. Pretty soon, he also developed a new kind of wheelbarrow-one with a big fat ball that didn’t sink into mud with chunky feet for stability. All the while learning to take risks, make mistakes and using frustration as a fuel for creativity and solving problems.
Problems like vacuum cleaners that loose suction. Could the cyclone technology he first spotted on a sawmill work in a vacuum cleaner? He ripped the dusty clogged bag from his old vacuum and replaced it with a crude prototype. This evolved into Duel Cyclone™ technology and the first vacuum that didn’t lose suction.
Clearly, over the last couple of years, the mortgage industry has had its share of mistakes and frustrations. The key will be using these mistakes as fuel for creativity and solving problems. Instead of just implementing new technology or accepting the status quo, it’s time to learn from our mistakes and deliver true innovation.
It’s time to “Solve Obvious Problems Others Choose to Ignore”. Is there an easier application process that borrowers can actually understand? Is there a way to more accurately determine property values? What can be done to create better transparency and salability of loans in the market?
Can data-integrity be improved and better used to actually improve the mortgage process? Can we once and for all significantly reduce fraud? Will we use common sense when underwriting loans or will we once again chase the money? The list goes on and on.
There are a number of exciting technologies that show promise such as improved SAS models, cloud computing, Silverlight, virtualization tools, analytics, and business rules engines to name a few. The challenge is will we roll these promising technologies out and just apply them to the same mortgage process that has got us where we are today, or will we apply them to solve obvious problems that we have chosen to ignore?
Share with us your thoughts on innovation in the mortgage industry. Have we ignored obvious problems within the mortgage process? What steps can we take to not make the same mistakes this time around? What innovative products are you most excited about?