AmazeRealise recently co-hosted a dinner for leaders in the Financial Services sector together with other sister agencies from Kin + Carta. Under Chatham House rules everyone got the chance to speak freely and we quickly found common themes emerging, particularly around ethics, the digital skills gap and how technology trends are impacting on everyone’s business.
What the analysts think
To get the debate going we listened to a fascinating talk from Oliwia Berdak who is a senior analyst at Forrester covering digital disruption and digital innovation in financial services (FS). She gave an overview of key trends and predictions, exploring changing customer expectations and behaviours and the start-ups that seek to capitalise on these opportunities.
In brief, Oliwia highlighted the following trends:
- 2019 is going to be a tough year for established players in FS
- Digital banks are likely to take millions of customers from incumbents
- These banks attracted $517m in funding last year
- Whilst challenger banks are nothing new they are now reaching a significant scale – Monzo, for example, now has a million users in the UK and offer a winning formula of being data-driven, eco-system enabled with an end-to-end digital experience
- There will be a consolidation of robo-advisors (currently there over 100 worldwide) due to thin margins and customer scepticism
Importantly, Oliwia highlighted that innovation will be crucial in the back office with brilliant digital customer experiences requiring the support of effective digital operations. Firms are starting to connect from back to front and applying technology to areas such as claims processing and liquidity management. This innovation is often frugal as budget sizes shrink. However, everyone is catching up fast and getting the back office right now is crucial to establish a place in the increasingly crowded digital eco-system.
One thing clear from the dinner was that Financial Service organisations can’t carry out this innovation alone. Creative and technology partnerships are a must.
This aligns with our own thinking around the power of tribes and the importance of building strong cultures around specialist crafts. We have been advising our own Financial Service clients to consider the same mindset when it comes to their organisation and meeting evolving customer demands in a digital age.
The question is how long established FS organisations can break down the silos that exist within their organisations and move more quickly to innovate in the back office.
What cannot be denied is that the Financial Service sector is changing fast. No-one is going to sit idly back and let the new disruptors take over market share. There’s going to be a lot of work going on behind the scenes in the next few months as major players put themselves in a position to offer seamless customer journeys and experiences that make the most of new technology.
If you’d like to know more about the issues discussed, and how our tribes of experts can help you to create a joined up digital eco-system, then we’d be delighted to talk to you. Get in touch using the form below.