Study Uncovers an Innovation Gap in Canadian Financial Services Sector

Innovation may be a top priority among Canadian financial services executives, but a new benchmark study by technology vendor GainX reveals a significant gap between the sector’s desire to innovate and its ability to execute.

The study conducted with members of the Toronto Financial Services Alliance and released today during the Digital Finance Institute’s Canadian FinTech Awards, assessed the innovation capacity of Canada’s leading financial services institutions (FSIs).

More than 375 executives and employees participated in the study, which captured insights on innovation derived from their respective organizations. Using GainX Insights more than 27,000 data points were analyzed, plotting FSIs on the innovation maturity curve and looking at the critical gains necessary for innovation and transformation, including strategy and clarity of vision, appetite for risk, digital enablement, culture, engagement and collaboration.

Key findings from the benchmark analysis:

●   While executives and employees alike indicated that becoming more innovative was a top priority, the Canadian FS sector’s capacity to achieve those goals is greatly limited.
●   77% of FSIs surveyed indicated they had no innovation process in place.
●   Only half (51%) of those surveyed believed their organization to be innovative.
●   75% of FSIs do not have innovation hubs, which brings to light the broader strategic importance of a robust innovation strategy that goes beyond churning ideas through a costly, funnelled approach to commercialization.
●   More than 90% of those surveyed indicated they lacked an actionable digital strategy and lacked digital enablement, representing significant barriers to innovation and growth.
●   Top challenges to innovation were identified as:
○   culture — most respondents felt their organization had significant room for improvement in the areas of communication and employee engagement related to innovation and;
○   a lack of IT systems to support rapid, purposeful innovation.

While the big picture thinking surrounding innovation is present and alive in our Canadian FS sector, our data shows that FSIs in this country are achieving only a moderate level of success when it comes achieving results,” says Angelique Mohring, CEO of GainX. “We also found that most FSIs are experiencing significant Innovation Drag caused by lack of transparency and metrics around the innovation process, poor agility and cultural inertia.

GainX is currently engaged with several leading financial institutions in Canada and the US to measure internal innovation capacity and engagement, identify and eliminate the roadblocks that cause Innovation Drag(™) and more precisely measure innovation return on investment (ROII).

Our FSI customers are rapidly realizing that ideas are not a good measure of ROII,” says Mohring.

Author: Dylan Jones

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