Innovation starts with its definition.

“There’s a broad way we define innovation,” said Susan Skerritt, head of business strategy and market solutions, BNY Mellon Treasury Services, during a panel at today’s SWIFT Operations Forum Americas. But for innovation to work at a bank, certain ingredients must be in place at the bank. Skerritt shared four elements that are essential for nurturing innovation at BNY Mellon, and other banks:

• Have executive sponsorship of innovations. Senior leaders must be talking about innovations in order for them to be layered in;

• Employee engagement. Everyone within the company should be innovative and contribute ideas to better the financial institution and its services;

• Business involvement. Banks can host incubation groups, but businesses need to be directly involved with developing and monitoring innovations. Each business has a target for what the innovation needs to do; and

• Funding. Resources need to be made available in order for bank’s to have the agility to deploy the “right ideas” when they are generated.

In finding innovations, testing new ideas out is also critical, panelists said.

“Innovation is about experimentation,” said Kosta Peric, SWIFT’s head of innovation. “You can’t predict the future but you can get ready for it.”