We all have our strengths, right? The growing desire for partnership between traditional financial institution and the fintech sector reflects the wisdom of each side playing to their unique strengths and spotting a compatible partner to enhance them.
Of course, there’s much to be gained from collaborating with partners whose skill sets can advance progress towards mutual success, especially in an era of dramatic change across businesses.
On one side, we know that fintech firms are brilliant at making beautifully executed digital products that keep up with customers’ changing expectations. On the other, banks are facing huge disruption owing to PSD2 opening up customer data, but the right partnerships can help them navigate it.
Meanwhile, nobody understands regulation better than banks, and they’ve got chops when it comes to building large teams and scaling successfully. As fintechs deal with an ever more complex regulation landscape, and their need to scale and to build large teams outstrips their experience in doing those things successfully, the potential successes are clear.
But what happens when these partnerships fall down, or don’t deliver on the promise that both sides had in mind? Often, this is down to a cultural issue which can stymie change, including deeper strategic partnerships such as those between a legacy bank and a fintech start-up. Solving these requires a new perspective on how both sides envision their businesses, and redefining the roles of their employees to maximise openness to change.
Transformation is the name of the game
On top of increasing customer demands, companies of all kinds are all too aware that there’s always a competitor lurking around the corner threatening to flip everything on its head and change the common landscape. The response is for companies to always plan to pivot or extend their services to stay relevant. Fintech partnerships are one way for banks to achieve these.
But those changes can be a bit like a Post-it™ on a lamppost; they stick for a bit, but it doesn’t take long for the winds of change to send them fluttering helplessly into the distance. That’s because meaningful transformation isn’t just about bolting on a new technology or processes – it’s about people.
More specifically, it’s about valuing, empowering and enabling people to take a leading role in the future of the business, setting them up to take responsibility for big decisions without escalating up a long chain of command.
Could you be a living business?
Organisations operating in a highly sophisticated digital world can encounter many challenges around flexibility, namely the ease with which they can shift internal structures as the external environment changes and new expectations emerge.
Thinking of a business as ‘living’ can empower and engage employees to make such changes without the need for major reorganization or cumbersome process implementation. The primary goal is to facilitate autonomy across an organization by using emotional intelligence over analytics; empowerment rather than hierarchy.
While these ideas are usually focussed on services offered to customers, in order to keep pace with their expectations and secure revenue streams, but it’s crucial to apply the same standard to the employees’ experience. Employees expect the same forward-thinking approach from their employers that they get from their seamless experience shopping on Amazon.
The benefits of giving them that are far-reaching, but they boil down to this: when your employees are engaged and autonomous, they can help your organisation to change direction nimbly and together, to ensure ongoing success in an ever-changing market.
The first step towards transforming into a Living Business is to understand the vital signs which contribute to your cultural success. Consider these as the building blocks of autonomy and adaptability. Below are also some examples of companies which are ahead of the game when it comes to leveraging them:
Personality is a long-term description of what a company stands for, its purpose, its reason for being. More than brand, it’s everything that company shows to the world. Netflix is visibly outpacing the rest of us when it comes to personality – it’s clearly articulated through the company’s purpose and values, and its employees are given the autonomy to live those values day to day.
Instinct is about how quickly and effectively an organisation can respond to change, and to challenges. Take a look at how Microsoft has turned its reputation around in the past four years. Its CEO, Satya Nadella, has engendered an empathy-driven leadership style, empowering and encouraging people to be their best, which has enabled the company to act on instinct.
Craft is the essence of what a business does, and what each person within it contributes. It’s about the combination of skills that make that organisation unique and impossible for competitors to replicate.
Relationships refers to every relationship within the organisation’s ecosystem, including every colleague, customer, supplier, and wider society. Cisco is a fantastic example of a company whose investment in relationships is helping them to keep their talent and ideas fresh, through their Entrepreneurs in Residence programme. They effectively open their organisational API to start-ups and keep their fingers on the changing pulse of innovation.
Although these points cite a business which excels at each, improving on all of these signs together will drive success.
With the complex landscape we currently inhabit, demanding businesses pool their resources to gain an advantage – doing so effectively requires a culture which is open to collaboration and adaptation. Ultimately, while fintech firms and banks may find partners beyond their borders, the true key of successful collaboration lies deep within the heart of your organisation.
By Abbie Walsh, Fjord