Each company or organization sets up a Vocoli "instance" to generate surveys, to build a suggestion box, and to connect with the team.
Which one of these is you?
There's no doubt that tech startups are hot right now. With the emerging dominance of GAFA (Google, Apple, Facebook, Amazon), it seems as if everyone is talking about “disruption” and proclaiming innovation as the engine that powers America’s new economy. Tech startups are flourishing everywhere.
But can these technological solutions be applied to more traditional, slower moving industries like banking and finance? Some financial institutions are betting that they can. As documented in this Bloomberg article, several banks are abandoning their traditional roles as careful and cautious lenders and adopting “accelerator” programs to bring rapid technological innovation to their organization.
The article points out that this move is partly being forced by outsiders. Venture capital funding in financial technology companies has surged, the figures almost doubled from approximately $6 billion in 2013 to over $12 billion last year. Bank executives have good reason behind their fear of missing out - the consulting firm Oliver Wyman estimated banks and insurers could lose as much as $150 billion in revenue to startups by 2025.
Hosting Facebook-style hackathons and creating tech accelerators are a major break in character for bankers. Traditionally all research and development in finance was built both in-house and behind closed doors.
But now even 325 year old Barclays is getting on-board with the tech revolution. The company recently hosted a boot camp with 200 entrepreneurs to develop solutions as wide ranging as buying auto insurance with a mobile app, making payments with a wearable device, and even handling transactions using blockchain, the software behind bitcoin. Many are skeptical about this major break in character, including the influential Harvard business professor Clayton Christensen, author of The Innovator’s Dilemma. He argues finance is often riddled with legacy systems, aging technology, and lack the flexible management practices necessary for innovation.
Because banks control the world’s money supply, they, by necessity, have rigid structures to protect their investments. The last time banking executives got creative with “financial innovation”, they helped create the global economic meltdown of 2008.
Since then, financiers have returned to their more cautious roots that do not involve taking wild risks like launching a startup. But, given the stakes, is it possible for big financial institutions to reap the rewards of innovation while lessening the risk?
We here at Vocoli would argue that not only is it possible, it’s even preferable. As makers of digital employee suggestion software, we’ve attained a lot of insight on what drives organizational improvement and in our experience, innovation done right does not necessitate taking wild risks like creating a start-up incubator.
Bankers and other financial institutions would be much better served by returning research and development efforts back in-house. The question to ask is “Who knows a bank’s internal workings better?” While an outsider perspective is often important and necessary, insiders know how things work best because it is their day-to-day job. In our experience, if bank managers are interested in improving operations, it’s often just a matter of asking current employees how to do so.
The fact is technological breakthroughs are exceedingly rare; they are the equivalent of hitting a grand slam home run. There is no need, and it’s actually foolish, to stake a company’s entire future on hitting one. Better by far to aim for singles and doubles consistently.
This method is known by the Japanese term “kaizen” which translates roughly to “continuous improvement.” Institutionalized at Toyota, this concept powered the company to become the world’s #1 automaker. And no start-up incubator was required for them to create the Prius, the world’s most fuel-efficient gasoline powered car available in the U.S. There’s no reason banks and other financial institutions can’t opt for this approach instead.
Vocoli’s employee suggestion software is designed to drive innovation and continuous improvement in your organization. Using our system, employees can post and discuss their own suggestions and comment on and “like” others. Managers can review and track suggestions and also guide the discussions by offering challenges and rewards. Contact us for a free demonstration today.
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