Innovate or die. That’s a recurring message for financial institutions (FIs) today. There’s no doubt innovation is a buzzword, but that doesn’t mean it isn’t incredibly important. In my latest white paper “Reimagined Banking in the Age of the Consumer,” I share why innovation is the key to our evolutionary quest for financial market relevance.
The excerpt below explores who is disrupting the financial services ecosystem, including the bottom billion, uber-wealthy activators and do-it-yourself engineers.
The financial services industry doors are wide open to disruptors. Peter Diamandis, an international pioneer in the field of innovation, talks about healthcare, education and financial services as the three sectors likely to experience interference from outside forces in the near term.
These three fields, Diamandis insists, are vulnerable because of the way their leaders are trained, namely to become proficient in one specialty. Meanwhile, the world around these specialized finance professionals, physicians and educators is changing. Innovations in computing, artificial intelligence and data analytics, for example, all become layered over their expertise, disrupting even long-held principles of the specialty.
It’s incredibly exciting to witness the life-altering innovations taking shape across the globe. Entrepreneur Dean Kamen can transform raw sewage into drinking water. Qualcomm is crowdsourcing the development of a personal medical scanning device — a real-life version of the iconic Star Trek tricorder. Dickson Despommier developed his concept of vertical farming, which promises to dramatically reduce land use. So what — and who — is driving innovation across the globe? Diamandis points to several trends:
The Bottom Billion — Formerly existing in strictly localized environments, people in countries like Africa or regions like Southeast Asia are today contributing to the world in exciting ways… Entirely new generations of contributors are reimagining systems, products and solutions unlike anything we’ve seen before. These individuals represent, as author Charles Leadbeater coined them, ‘a new breed of frugal innovators in the developing world.’
Uber-Wealthy Activators — These are the individuals who have an abundance of time, creativity and resources… Not willing to wait for advancements to come tomorrow, these types of individuals are going out and making them happen today with little to no regard for the cost.
DIY Engineers — Some of these small organizations and individuals are intrinsically motivated to create change. They’ve experienced a pain, a hardship or even an annoyance they believe can be rectified. Meanwhile, advances in technologies and communication systems have made it possible for them to share their ideas with the masses.
To download the full white paper, visit themembersgroup.com/innovation.
Watch for my next blog, which will focus on the criticality of linking innovation with the business plan.