Singapore
Future-proofing strategy with bank's CEO
Innovation transformation
Problem to be solved:
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How can the bank develop a future proof strategy to preserve the bank through any unprecedented times to come?
Solution:
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Selecting and coaching a dedicated team of young bankers through the venture building process.
Results:
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New venture building business
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New incentive structure
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New Bank CIO
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Scoping the problem
There is no question that the traditional customer segments that banks target, such as HNWI (High-net worth individuals), have become saturated or red ocean markets. Faced with Fintechs, non-traditional tech players, and unprecedented low interest rates, banks need to look for new blue ocean markets to capture. The problem? Most of our banks have used the same business model to target the same segments since their inception. Where do we even begin?
We started by working with the bank’s C-suite to understand what their strategic priorities were for the next five years. The bank had a clear understanding of how to protect its core or Horizon 1 business, but the strategy neglected to consider the new expansions and possibilities or Horizon 2 and 3 business. Horizon 2 business typically refers to geographical expansion strategies. Horizon 3 business refers to radical new business units. The principle idea being that you should disrupt yourself, before someone disrupts you.
We ran a session with the C-suite where we presented our strategic recommendations, to make the bank future-ready. We eventually landed on a strategy that would protect the short and long-term interest of the bank. Key to this, is creating a venture building business that is separate from the existing business units. Although innovation does have a role in the existing business, this is Horizon 1 innovation. We believe Horizon 3 innovation is most effective when operating separately from the rest of the bank.
From there, we had weekly advisory meetings with the bank’s CEO, where we coached them on creating a more agile and forward-looking organisation. Over the course of a year, many new initiatives were launched, including new ventures, new incentive structures, and the introduction of a Chief Innovation Officer. The banking industry is still under threat, but this is one bank that seems better prepared to turn that into an opportunity than most.