If you don’t like change…you’ll like irrelevant less

If you don’t like change…you’ll like irrelevant less. This was the topic of a talk my good friend Paul Leblanc gave recently at the World Lottery Association marketing conference. I’ve included  the video supporting Paul’s talk below. Paul, and his team at Karma Gaming, are taking online gaming to a new level and it is exciting to see what they are up to and learn a little more about their point of view. With that said the question as always is how does this relate to banking? Well back in June 2011 my  blogging partner Kris Hansen  wrote  “Gamifying Banking: What banks can learn from the recent revolution in gaming”. In the blog Kris outlined why banks should be looking at gaming and incorporating it in their overall customer interaction strategy. I think that the Karma video above helps to support Kris’ point about gaming being a powerful tool that everyone with a digitized audience, including banks, should be actively chasing. If you are a banker and are short on ideas on how to do this, give me a call, I’ve been developing banking game ideas and processes for about the last two years. But this is not the banking point I want to make. The idea, lesson, or point, that I would like every banker to take away from this is about irrelevance. I work, or have worked, with a number of banks, and an even larger number of smart and dedicated bankers, and in all cases the ability to conceive of bankings current status quo becoming irrelevant is almost non-existent. The initial quote in the video from RIM’s  Mike Lazaridis is very telling:

“There will never be a BlackBerry with an MP3 player or camera.”

In banking today it would be the equivalent of saying:

  1. ” There will never be a time when there are no branches”
  2. “There will never be a time when customers will not use our traditional payment systems”
  3. “There will never be a time when I might loose market share because I don’t have a cool mobile app”
  4. “There will never be a time when I need to be concerned about what social media is saying”
  5. “There will never be a time when we might need to find new sources of revenue to continue to grow market value”
  6. “Distributed disparate systems are definitely the way to manage risk and customer information”
  7. “My customers don’t want to play games, they want to take time out of their days to stand in line in a branch to apply for a loan”

Because banks fail, on a large scale, to want to overhaul or question their core banking processes, beliefs, culture, and are more likely to opt for change that is quicker or cheaper they are setting themselves up for irrelevance. For example I have had the experience of working with a bank who, on one hand identified the need to grow a new channel and was investing heavily in a mobile mortgage sales force, but on the other was tailoring an account origination processes via a core banking program to address their branch network. Brett King recently released a book called Branch Today, Gone Tomorrow The Case for the Death of Branch Banking. In his book Brett clearly outlines why branches are declining in relevance and how they will quickly sink to the bottom of  the list of preferred channels behind mobile, online, and call centre. I don’t subscribe to Brett’s entire  thesis however when you look at the numbers and behaviours the decline in the relevance of the branch network is clear, and it begs the question why would you want to prioritize branch processes in your core banking initiative, spending time and good money, when you could invest the time and effort on other more relevant channels like mobile mortgage sales forces? The answer is the perception of the traditional banks related to how they see branches. The ability to see value beyond the status quo and traditional channels is crucial for innovation. Core banking transformations can take years and with the speed of change these days questioning outdated and irrelevant business models, business processes, and business cases will mean the difference between innovation and irrelevance.

3 Responses to If you don’t like change…you’ll like irrelevant less

  1. the need for interaction with a human face is a very natural need. A pleasant face with an intelligent conversation can sell much more easily than any automated channel. Live chat is a close substitute but not quite the same as talking to a human being face to face.

    the branch has to become a place where “We also do banking” providing a very convenient and comfortable experience with an ambience.

    I agree that focus on traditional process change in branches may not provide returns for the money spent on it. We need to think diofferently about the place where we serve and sell with human interaction face to face.

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