When traditional business meets disruptive innovation
Day three of the Cass MBA London Symposium 2016 focused on when traditional business meets disruptive innovation.
Day three of the Cass MBA London Symposium 2016 focused in when traditional business meets disruptive innovation.
Matthew Gardiner: ‘FinTech – the past, present and future’
Cass welcomed Mathew Gardiner, Founder of Catch London, to the Science Museum, to open the third day of the School’s MBA London Symposium.
Gardiner’s specialism in FinTech has seen him consult to banks, financial institutions, high growth technology businesses, corporations and ‘Scale Ups’ on successful growth strategies centred around FinTech.
His presentation ‘FinTech – the past, present and future’ he showed people are spending increasing amounts of time on a mobile device (up 35% in 2015), but are spending 10% less time ‘in browser’. He posed the question: “In an era when people expect fast digital services, why don’t financial services deliver the same results as Amazon Prime?”
The future of FinTech
Gardiner believes that FinTech is already disrupting and innovating sectors such as banking and insurance, using examples such as Starling Bank and Ethos Lending.
“Companies want to you to spend time ‘in app’ and then direct you out to their website. Facebook does this really well, so does WeChat in China, where users can access several other services via the platform. It would be easier for banks to attract customers to their banking apps via messaging services in a similar manner to WeChat”.
Emergence is surpassing resilience
In 2015 there was $13.8 bn in VC backed FinTech investments spread over 653 deals, with London being one of the highest growing markets. Gardiner said, “$3.6 bn has been invested in the UK, but while London is the high growth market, the most competitive, the most innovative is Africa. There is a real sense and need for collaboration in Africa”.
“Looking to the past, first movers often take the worst hits, but data is the key – we have to learn from it. Now, we’re seeing a very different model in FinTech. Previously, companies focused on being resilient and be able to take the shocks and remain stable. Although, resilience is still a current theme, now we should concentrate on being emergent. People don’t innovate within their own companies…they outsource, they crowdfund, and always, they remain connected”.
Ian Powell: ‘Building Trust in a Fast Moving World’
Next on stage was Chairman and Senior Partner of PwC, Ian Powell. His talk on trust highlighted how corporate organisations can be strategically led based on a culture of values and behaviours.
Powell joined PwC in 1977. He joined the UK firm's Management Board in 2006 as Head of the Advisory business and was elected Chairman and Senior Partner with effect from 1 July 2008.
A culture of trust
“PwC has a 175 year history, is a top graduate recruiter and the average age of our employees is 27-28” he said. “So how do you ensure the organisation stays moving forwards?”
Powell believes the organisation’s culture should be one based on values and behaviours that inspire trust.
“PwC is a people business and we need to remain confident that we are doing the right thing, for our clients and our staff.
“We came back stronger after the 2008 economic crash but how could we create a culture where it was acceptable to challenge unacceptable behaviour?”
Trust is a difficult concept to describe, especially in a society when trust was at an all-time low in the financial and professional services sectors. Ian added, “There was a fundamental loss of trust, not just between people and business, but between institutions and society.”
Embracing intelligent tech
If the right culture lends itself to long term sustainability, then the UK’s greatest (and oldest) institutions have to demonstrate they operate in a culture of trust, summarised Ian.
However, increasingly, people are worried about technology. There are fears that technological advances will put people out of jobs and ‘dehumanise’ our relationships with institutions. But Ian believes that with every advancement in humanity’s history, from the industrial revolution to the emergence of the digital age; new technology can help rather than hinder:
“If we embrace intelligent tech, it makes our lives more interesting, but we need to put the humanity back into technology. We need to encourage trust in tech. Finally, all leaders need to focus on ‘trust’; there may be set-backs (like the Panama Papers), but leaders must continue to try!”
Nigel Gilbert: ‘Creating a Challenger – being an entrepreneur in a corporate environment’
Cass welcomed Nigel Gilbert, Chief Marketing and Communications Officer for TSB Bank who addressed the challenge of launching a ‘new bank that was 200 years old’.
“Being a challenger in a corporate world can be tough,” Gilbert said. But it was a challenge he was willing to tackle when he joined TSB Bank Plc after moving from Virgin Media as its first Chief Marketing Officer. Prior to Virgin, he was Group Marketing Director with Lloyds TSB
“Retail banking is suffering from customer inertia and oligopoly. Communities are not being served, and the covenant of trust has been broken between banks and customers,” he said to the audience.
TSB Bank was mandated to shake up the UK retail banking market and bring more competition to the sector. It was the biggest banking launch in Britain in 100 years, with a singular message of welcoming its customer back to local banking: a far cry from the big five banks who pride themselves on their global outreach.
Informed by values, underpinned by culture
Gilbert showed Cass MBA’s how the TSB brand was different to its competitors. The banks is driven by purpose and informed by a set of values:
- The brand is the customer experience
- Sustainable growth can only come from advocacy
- Purpose is not a department. The business is the cause and the cause is the business.
- It’s a contract. If we help our customers they will reward us and we will make money.
“It’s not easy to make changes but at TSB we put customers and community before short term profits and CSR is built into our operating model”.
Julian Sawyer: ‘Building a new Bank … on a mobile’
Julian Sawyer, COO of Starling Bank was last on the stage. His talk on building a challenger bank for a digital age focused on how Starling will offer one product on one channel: current accounts via your mobile device.
He said, “Real challenger banks are not the TSBs or the Virgins, they are new banks – there’s a difference. Challenger banks have to be fundamentally different and ten times better than their competitors to attract customers.”
“All current accounts do the same thing and there’s nothing amazing about them. Personal current accounts do what they should, not what you want!” he added.
A tech company with a banking license
Starling needs to ‘do’ banking better according to Sawyer. As well as being safe and secure, Starling also needed to offer:
- Make it easier for the customer – e.g. setting up and making payments in app.
- Be faster - and more intuitive, think of the search capabilities of Gmail. Why can’t you search your bank statements in the same way?
- Do things for the customer – online help without barriers
- Thinking about the customer – providing meaningful money management
“We are not looking at our direct competitors, instead we look to disruptors like Spotify and Uber and Amazon”.