What must we keep front of mind about innovation? I’ve asked myself that question many times. If we’ve learned one thing at BAI from seven years of recognizing financial services companies in our Global Innovation Awards and our work in this arena, it’s this: Innovation can’t be pegged to a single project or activity.
Nor strictly speaking is innovation limited to FinTech and technology advancements, even if many in financial services equate the two. Study after study reveals immense investment to that end.
And in its recent report “Financial services technology 2020 and beyond,” PwC stated that global FinTech investment more than tripled in 2014, passing the $12 billion mark. Artificial intelligence, data analytics and blockchain are on everyone’s radar these days.
Yet innovation in financial services has its share of challenges, especially when it comes to the speed of consumer adoption and the difficulty of staying ahead of the latest digital advancement. When the industry was abuzz over mobile banking, for example, it didn’t take long before that became business as usual. Look back at the early days of SMS texting or the unveiling of the first smartphones – all are part of our everyday life. Seems like it happened in the blink of an eye.
To be sure, different forms of AI and data analytics—or whatever technology innovation brings to the fore—demand that we stay on top of them, understand them and make them fit into our strategic priorities.
Thus, part of understanding advancements is to not overreact to them. A fine line exists between recognizing a game-changing trend and losing sight of all else. We need to keep our eyes on other things.
While the shiny new toys of FinTech will come and go, there will always remain a pressing need for innovation—a kind that has stood the test of time and promises to remain timeless. The noise floor for standing out in the marketplace is louder than ever, which has given executives of all types in all industries—not just banking—an imperative to search for ways to adopt forward-thinking and stay relevant to customers.
Beyond technology, the heart of innovation intersects a broad spectrum of categories: process innovation, channel delivery, marketing, human capital, and societal and community impact. Innovation represents a way to change things for the better but is also creative thinking, problem solving and “breakthrough collaboration” which is recognized in a new Global Innovation Awards category this year.
Elsewhere, you’ll see some exciting developments where, while technology is involved, the result is not tech-dependent. Turk Ekonomi Bankasi, based in Istanbul, won our 2016 Societal and Community Impact award for its TEB Women Banking program, which provides financing, information and advice to women-led, small- and medium-sized businesses. That’s crucial because in Turkey, 10 percent of equity in Turkish SMEs belongs to women—yet Turkey has the highest ratio of unemployed university graduate women in OECD countries.
In organizations that make a difference—and bring breakthroughs from the drawing board to reality—you’ll find innovation at the center of their strategy, mission and DNA. Through the history of the BAI Global Innovations Awards, the organizations that show up consistently have innovation at the core of their being. They sustain it as the central tenant of the way they work and the way they think.
And when innovation infuses the core of what you do, amazing things happen that transcend the short term and power the long haul. When it works—and leads the way for our industry—innovation strategy finds new ways to serve the customer and address their pain points. Sometimes this will result in cost savings, but it must create a positive financial impact while it makes a fundamental difference in how we serve customers.
What’s more, innovation as a value can’t be bought—and the smart executives get it. At such institutions, you’ll see C-level leaders get involved because they know they can’t delegate innovation to a young guy in a garage.
And finally, organizations must be wary of blueprints that languish on the drawing board. Just like “innovation theater”—where in-house committees armed with PowerPoints disguise smoke and mirrors as great leaps forward—potentially solid innovations that die on the vine can set a bad precedent of “all talk, no action” that your employees will note. Companies that embrace innovation must act on their plans and bring their bold ideas to fruition, even if that means having to pivot and correct course as they go.
Let us then, as we close in on 2018, strive to broaden our view. This in and of itself represents a gateway to innovation—for when we take on new vistas, we truly see things differently. We see what can be. We see a road ahead where others can’t, one that benefits customers and is good for business. Then we build that road, follow it and watch others follow us into the future.
We innovate. And then we do it all over again.
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Debbie Bianucci is the president and CEO of BAI. Tune in Monday to hear her discuss the importance and evolving facets of innovation on the BAI Banking Strategies podcast.