How to Innovate in Financial Services Companies

‘Tis the season for vendor conferences and this year innovation is the hot topic. Many speakers are making a strong case for why financial services firms need to innovate – customer expectations being shaped by conveniences such as the Amazon One-Click, demographic changes bringing the millenials into the consumer age, opportunities emerging in predictive analytics, customer service capabilities using location sensing technologies, etc. In some of the presentations there is even some recognition that innovating in existing (read legacy) businesses is much harder than in start-ups and greenfield operations. But, I have noticed that beyond the major themes, there is not much information about how established financial services companies innovate successfully – lots of why, but not much of how. But, the “how” is of critical importance to innovators. Celent knows this because we asked. In order to build the agenda for four of our Innovation Roundtables, we asked the registrants to choose the topics they wanted to discuss from a list of 27 items. Thirty-four people voted, reflecting a very specialized respondent pool. These are all professionals who are charged with driving innovation in financial services companies. Their top ten areas are displayed below. In looking at the data, over half of the items fall in the broad category of leadership / culture. Process is the second most frequent group and, interestingly, technology figures only once (in the category dealing with social technologies for innovation). This prioritization held up in the amount of time spent in discussion during the face to face sessions. The conclusion is that tech can be bought, but leadership has to be built! But, getting back to the how, given that culture and leadership is so important, how does a company choose leaders which can successfully deliver innovation? What technical business skills, personal attributes, previous job experiences are critical in an innovation leader? Celent has also surveyed innovation practitioners about this and I will blog about these results next week. By the way, our next Innovation Roundtable is scheduled for November 20 in New York City. Senior innovation leaders from Banks, Insurers, and Security Firms are invited to join us. The registration details can be found here: https://www.regonline.com/builder/site/Default.aspx?EventID=1623753