Life is different now – which financial institutions will capitalize? 20 October 2021
Efma LIVE will address the major themes shaping the industry and help people chart a path forward.
It is a moment for reinvention. For banks and insurers around the globe – not to mention individuals – the past year and a half has been a time to adapt and endure. Amidst the upheaval, people figured out ways to work, innovate, and deliver. Now, our new normal isn’t so new anymore. People are accustomed to working remotely. Business travel is a thing of the past. Online shopping is the primary form of commerce. Habits have been formed and grooves have been imprinted.
With permanently altered behaviors – among both employees and customers – financial institutions are looking to the future with fundamental, transformative questions to answer. It is in this spirit that Efma LIVE Inspire Change will take place at the end of November.
We want to showcase leading thinkers, executives, and innovators from the industry who will define the future into which we are entering. Their thoughts can serve as a signpost for others who are charting their own path. Let us run through the five themes from the weeklong event and some of the core questions to be addressed.
HR and talent management
The pandemic served as a one-off catalyst that altered working models for decades to come. By now, it is fairly clear that remote work is here to stay. Remote and hybrid offers are taken as standard in job descriptions. Some countries and companies are going even further in their experimentation with 4-day working weeks. The question for banks and insurers is now, "How do we meet worker expectations in years to come?" That prime real estate in the heart of the city made sense when the office was full every day. Now, those costs are more difficult to justify when employees are only in 2-3 days a week. Defining an optimal working model will be key in attracting and retaining the best talent. These big decisions require investment, creative thinking, and a touch of audacity.
This is a topic we have explored extensively at Efma. Given the continued explosive growth of the fintech industry, banks recognize the opportunity that collaboration represents. Fintechs pride themselves on being more customer-centric than product-centric. Traditional players can leverage the technology and agility of a dynamic fintech to build out new products, quicken their time to market, and deepen customer engagement. These partnerships can also help in better aligning with the values and lifestyles of customers. Consumers are choosing banks with the expectation that they will receive more than mere money management tools. Banks need to maintain relevancy with an upcoming generation of customers that is informed, socially conscious, and always online.
Customer journey transformation
With everyone migrating online, this has had a major impact on the customer journey. As EY writes in their upcoming report, “As our lives become more digital and virtual, the various spheres of life begin to converge ‘above the glass’ on our devices which have become a reflection of our relationships, needs, ambitions, and desires in life. This presents an exciting opportunity for banks to go beyond banking and support customers more deeply through their life goals.”
Furthermore, the online migration raises a crucial question: How do financial institutions ensure all of that customer data is secure? There is a constant tension between providing the necessary cybersecurity versus the need for a frictionless customer experience. As one recent interviewee from IBM said, “People go to a website to order a pair of jeans, or to get a new product or a new service. They didn’t go to the website because they wanted to go through a lengthy sign-up process.” The transformed customer journey cannot discount the importance of security.
Customer behaviors were changing rapidly even pre-pandemic. Then, the pandemic put the shift to digital in the express lane. Shopping, banking, connecting, dating, traveling; it is all done online. Banks recognize this. But recognizing a trend and capitalizing on it is a different story.
How are they reacting? One emerging idea is the digital marketplace. Whether it is Canada or Russia, banks are constructing impressive digital ecosystems in which customers can access a wide variety of non-financial services. They are using their troves of data to produce relevant offers that expand ties with customers. This links back to the convergence of life spheres that EY talks about. As banks compete with, well, every other app on your phone for attention, they realize they need to do more than just display your account balance. The ecosystem play, inspired by Big Tech companies, has captured the imagination of industry executives.
Insurance of the future
The insurance industry of tomorrow will not be the same as yesteryear. Efma’s Chairman, Jean-Marc Pailhol, Head of Global Strategic Partnerships at Allianz, identified two megatrends that are shaping the industry: “On the one side, we have the emergence of these new digitally-focused customer segments, with completely different behaviors and needs. And the other side is the necessary transformation of our current business model with improvements and digital transformations. Managing and adapting to both of these trends simultaneously is a major challenge but also a big opportunity for insurers.” Who is going to grasp the opportunity and build the insurance model of the future that capitalizes on transformed views of ownership? Or tap into the potential of wearables and the IoT to create new offerings that sync with and reward a customer’s lifestyle?
All of these themes and important questions will be addressed at Efma LIVE. Our roster of impressive industry members will talk through their visions of the future, providing attendees with important takeaways that can inform their own plan to capitalize on the normal we now inhabit.
Be sure to register now for this can't-miss event that will help you navigate the coming year.