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Bye Bye Banks? - How banks are being displaced, diminished and dis-intermediated by tech startups and what they can do to survive

Bye Bye Banks? - How banks are being displaced, diminished and dis-intermediated by tech startups and what they can do to survive

This presentation is from Adaptive Lab's Bye Bye Banks? book launch and disruption in finance panel event.

Author and MD of Adaptive Lab, James Haycock, used this presentation to set the scene of the retail banking landscape in light of the digital revolution. It explores the changes and disruption currently sweeping the banking sector and outlines what traditional players can do to safeguard against fast emerging tech competitors who are taking their share of the financial market.

Key messages and themes from the book are explained including:

- The unbundling of retail banking services by startups.
- The three stage scenario that sees traditional banks being displaced, diminished and dis-intermediated.
- The 10 point Beta Bank operating model - a model that incumbents can follow to design a business that can survive the digital disruption.

You can learn more about Bye Bye Banks? and view other related content at the Adaptive Lab website: http://bit.ly/1KXJsQX

We also curate a Flipboard magazine that presents the latest articles on disruption in financial services. Expect stories on new entrants, technology and consumer behaviours as well as innovation news from established players. We think it's well worth following: http://bit.ly/1gqc226

This presentation is from Adaptive Lab's Bye Bye Banks? book launch and disruption in finance panel event.

Author and MD of Adaptive Lab, James Haycock, used this presentation to set the scene of the retail banking landscape in light of the digital revolution. It explores the changes and disruption currently sweeping the banking sector and outlines what traditional players can do to safeguard against fast emerging tech competitors who are taking their share of the financial market.

Key messages and themes from the book are explained including:

- The unbundling of retail banking services by startups.
- The three stage scenario that sees traditional banks being displaced, diminished and dis-intermediated.
- The 10 point Beta Bank operating model - a model that incumbents can follow to design a business that can survive the digital disruption.

You can learn more about Bye Bye Banks? and view other related content at the Adaptive Lab website: http://bit.ly/1KXJsQX

We also curate a Flipboard magazine that presents the latest articles on disruption in financial services. Expect stories on new entrants, technology and consumer behaviours as well as innovation news from established players. We think it's well worth following: http://bit.ly/1gqc226

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Bye Bye Banks? - How banks are being displaced, diminished and dis-intermediated by tech startups and what they can do to survive

  1. 1. @Jameshaycock AdaptiveLab.com BYE BYE BANKS? How retail banks are being displaced, diminished and dis-intermediated by tech startups and what they can do to survive
  2. 2. 2 Title | Subtitle What we’re going to cover Intro A three stage scenario already underway Why change within established companies is hard What traditional banks can do Setting the scene Displaced, diminished, dis-intermediated People, Culture, Technology Launching a Beta Bank
  3. 3. 3 | Bye Bye Banks 55 450m $100bn
  4. 4. | Bye Bye Banks4 “software is eating the world” Marc Andreessen
  5. 5. | Bye Bye Banks5 Could banking be next?
  6. 6. | Bye Bye Banks6 “Banking is necessary. Banks are not.”
  7. 7. | Bye Bye Banks7 “We can reinvent the entire thing”
  8. 8. | Bye Bye Banks8 “They all want to eat our lunch”
  9. 9. 9 | Bye Bye Banks
  10. 10. 10 Displaced, diminished, dis-intermediated A three stage scenario that is underway | Bye Bye Banks
  11. 11. | Bye Bye Banks11 Displaced
  12. 12. | Bye Bye Banks12 Diminished
  13. 13. | Bye Bye Banks13 Dis-intermediated
  14. 14. 14 Displaced, diminished, dis-intermediated in Telco | Bye Bye Banks
  15. 15. | Bye Bye Banks15 Displaced
  16. 16. | Bye Bye Banks18 Diminished
  17. 17. | Bye Bye Banks21 Dis-intermediated
  18. 18. | Bye Bye Banks25 Could banking be next?
  19. 19. 26 | Bye Bye Banks Displaced, diminished, dis-intermediated in Banking
  20. 20. | Bye Bye Banks27 Displaced
  21. 21. | Bye Bye Banks?28
  22. 22. | Bye Bye Banks29 Title Text
  23. 23. 30 | Bye Bye Banks
  24. 24. | Bye Bye Banks?31 core banking activities 3rd party app ecosystem PSD2 The need to visit bank properties is lowered
  25. 25. | Bye Bye Banks32 Diminished
  26. 26. 33 | Bye Bye Banks 1. ITS SIMPLE, JUST TAKING 5 MINS 2. WE TAKE CARE OF ALL YOUR DIRECT DEBITS 3. SIGN UP BONUS: £150 Hey Jenny, Based on your spending activity and existing products, we think you’d be better off switching. See my options and read reviews SWITCHING OFFER
  27. 27. | Bye Bye Banks34
  28. 28. | Bye Bye Banks? Bank A Card 2 Card 1 £ Credit card Co. Card 3 Bank B
  29. 29. | Bye Bye Banks36
  30. 30. | Bye Bye Banks37 Dis-intermediated
  31. 31. 38 | Bye Bye Banks
  32. 32. | Bye Bye Banks?39 Bank A Bank B Intermediary
  33. 33. 40 | Bye Bye Banks| Bye Bye Banks
  34. 34. | Bye Bye Banks41 “The impact of the distributed ledger could be much wider than payments… …it may be possible in the future for the existing infrastructure of the financial system to be gradually replaced by a variety of distributed systems” Bank of England, 2014
  35. 35. 42 People, culture and technology (why change is hard) | Bye Bye Banks| Bye Bye Banks
  36. 36. 43 69% banking executives didn’t believe retail banks are able to react quickly enough to changing consumer needs. Adaptive Lab / Research Now | Bye Bye Banks
  37. 37. | Bye Bye Banks44 79% of banking executives felt their leadership weren’t knowledge about digital. Adaptive Lab / Research Now | Bye Bye Banks
  38. 38. 45 “Depending which bank you talk to, they will tell you that anywhere between 50% and 90% of their IT budget is being driven by regulatory changes. It makes change very difficult.” Anonymous Banking Executive | Bye Bye Banks
  39. 39. | Bye Bye Banks46 “If you’re a group MD responsible for a P&L it’s understandable you are not going to innovate or disrupt in a way that damages it.” Lee Sankey, former Group Design Director, Barclays | Bye Bye Banks
  40. 40. 47 How the incumbents can respond: Launch a Beta Bank | Bye Bye Banks| Bye Bye Banks
  41. 41. 48 Rethink A Beta Bank is a fresh start, redesigning a bank from the ground up. | Bye Bye Banks
  42. 42. | Bye Bye Banks49 | Bye Bye Banks Separate A Beta Bank is distinct from the parent bank with a different HQ and independent leadership.
  43. 43. 50 Experiment A Beta Bank is an experiment in new products, services and ways of working. | Bye Bye Banks
  44. 44. | Bye Bye Banks51 | Bye Bye Banks Digitise A Beta Bank is a digital business from the ground up.
  45. 45. 52 Design A Beta Bank prioritises investment in customer experience and uses design to solve problems. | Bye Bye Banks
  46. 46. | Bye Bye Banks53 | Bye Bye Banks Focus A Beta Bank isn’t everything to everyone. It offers a few, differentiated products for a well- defined customer.
  47. 47. 54 Open A Beta Bank is transparent and open. Its business model is clear and its pricing simple. | Bye Bye Banks
  48. 48. | Bye Bye Banks?55 The Beta Bank Operating Model 1. Purpose 2. Customer 3. Leadership 5.Cultur e 4 .People 7. Team Structure 6.Prin ciples 10. Long Term View 8. Working Practices 9.Techn ology
  49. 49. | Bye Bye Banks?56 Appoint native leaders
  50. 50. | Bye Bye Banks57 Organise in small, multi-disciplined teams
  51. 51. | Bye Bye Banks?58 Design around modern working practices
  52. 52. | Bye Bye Banks59 “If the rate of change on the outside is faster than on the inside, the end is near.” Jack Welch
  53. 53. | Bye Bye Banks60 1. Banks are being displaced, diminished and dis-intermediated 2. Legacy technology, culture and people make it hard to change from within 3. To create an organisation that can compete with companies run by the likes of Mark Zuckerberg Banks need to launch a Beta Bank Wrap up
  54. 54. | Bye Bye Banks61 Are you ready to launch your Beta Bank?

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