The need for convergence and speed
The financial sector will be disrupted by four key factors. Each of which I am discussing in separate blog posts. In this blog post, I’ll share key reasons to why you need to hurry up!
Banks and insurance companies will be affected by four key factors:
- New and disruptive technologies
- New directives from the European Union
- Industry convergence and SPEED
- Changing customer buying behaviour and the new sharing economy
Things are moving fast in the financial industry. This is not a surprise, yet few banks have put their running shoes on. New technology such as block chain and open API’s (that comes with PSD2) will soon eliminate bottlenecks and information monopolies.
Challengers to traditional banks are developing quickly. They’ve got a laser sharp focus and they go for selected hot spots in the value chain. Frankly, they can basically spit out new innovations by the speed of light.
Industry convergence is happening quickly
Simultaneously, industries are converging. Retailers are becoming banks and bookstores are becoming cloud providers. This means that banks also have to be on their toes and flexible enough to keep up with the fast pace, in order to stay relevant.
Customers expect improvements and new types of services at a speed never seen before. Today, the bank and insurance customers have very little understanding and patience when it comes to new functionality or services.
They don’t care about historical investments in back-end systems or the complexity of integrating back-end and front-end solutions, or even the incorporation of a customer 360-view of transactions. They simply expect the best customer service in the market, at all times. If someone else other than their trusted bank can perform a task for them in an easier way – the New Customer will not think twice about using their services instead. Especially since customers’ confidence in banks are at a record low*.
Stop thinking, act before it is too late
Nordic banks and insurance companies no longer have time to evaluate, think and plan – they need to place their bets now. Embrace the start–up mentality: fail fast and try a different way. If they don’t, a future unicorn will move in and take their space.
“Banking is no longer somewhere you go, it’s something you do.” – Brett King
What can you do?
- Take a look at the whole value chain, and embrace the ecosystem – build lasting partnerships.
- Walk in your customers shoes – visit your own digital outlets, is this the best user experience and will it help retain your customers and attract new ones?
- Make sure to get to know the customer and use past behaviour to predict future needs.
Whatever you are going to do – do it now! If you wait and think about it, someone else will seize the opportunity and take your place.
“Do or do not, there is no try” – Yoda
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Read my previous blogs: