Withdrawing money from a bank is a frustrating experience for Nigussie Mengesha when he visits Ethiopia, his home country.

“You fill out a withdrawal form, you line up with your request, and then manual signature verification and approval follow before a cashier pays you,” he says.

The time-consuming, error-prone and costly process has no place in an era of digital transformation where banks strategically leverage digital technologies to improve operations, reduce costs and meet evolving customer expectations, says Mengesha.

The Assistant Professor of Information Systems aims to develop a new framework for banks in developing countries to transition from outdated infrastructure to cloud-based solutions.

He is doing so with support from Brock’s University’s new Black Scholar Research Grant.

“Dr. Mengesha is using his considerable knowledge and experience to transform theory into practical actions that will effectively advance Ethiopia’s banking sector,” says Brock’s Acting Vice-President, Research Michelle McGinn. “It’s exciting to see how his research will open up opportunities for customers, businesses and many others in Ethiopia and beyond.”

Pursuing digital transformation in developing countries presents distinct challenges, Mengesha says, including weak infrastructure, regulatory hurdles, cybersecurity risks and resistance to change.

“Yet, growing demand for digital financial services — fuelled by internet access, smartphone adoption and financial inclusion efforts — compels banks to modernize legacy systems,” he says.

Cloud-based solutions have emerged as a strategic alternative to modernizing information technology (IT) infrastructure, offering enhanced scalability, flexibility and security while lowering infrastructure costs.

Cloud-based solutions also give banks the flexibility to reach “unbanked communities” — people who don’t use mainstream banks to save, borrow or transfer money, Mengesha says. In Ethiopia and other developing countries, these communities are typically rural and low income.

However, migrating legacy systems to the cloud can present technical and organizational challenges.

Mengesha’s research will begin with a survey of Ethiopian banks’ current IT infrastructure, readiness to adopt cloud computing and perceptions of its benefits and risks.

His team plans to examine how cloud services are being adopted in Ethiopia by interviewing cloud service providers and financial technology companies and reviewing government regulations.

The researchers will also examine studies on best practices for banks adopting cloud systems, case studies from developed and developing economies, and cloud migration’s regulatory and security implications to identify key challenges and risks.

He and his team will then focus on co-developing a digital cloud migration plan with executives, IT managers and IT staff at Bunna Bank, headquartered in Ethiopia’s capital, Addis Ababa, with whom Mengesha has worked in past research and courses he taught.

At the heart of the plan is a phased migration process that builds on existing technological adoption, strategic management and change management literature.

The process that Mengesha will develop with Bunna Bank personnel consists of three parts.

The Structured Decision-making Framework examines technological, organizational and environmental factors shaping cloud computing adoption and the dynamic capabilities needed to navigate a volatile and uncertain business landscape.

Once these are identified, a Cloud Migration Strategy can be formed, “ensuring a smooth, secure and cost-effective transition to the cloud,” he says.

The Change Management Model helps stakeholders and employees to adopt and use the new cloud system.

“Technology has been shaping the way we’ve been leading our lives, the way we work, and the way we learn; it’s fascinating,” he says. “I see this project as being not just a theoretical contribution, but a practical contribution to society, a way of helping banks get from point A to point B.”