Confessions of a FinTech Innovator #5

Part 5: The Ten Fintech Commandments

If you’re a leader or innovator at a Bank facing the challenge of Fintech in 2018, what should you do? Here are my 10 commandments.
  1. Hire more entrepreneurs. A wise lady once told me that mavericks are like the canaries in the mine. Get them flying through your organisation now!
  1. Weed out weak and ineffectual management. The best leadership recognises people who aren’t performing (or worse, are toxic) and proactively cuts them free. You can fire fairly too – Timpson’s is one of the best organisations for ruthless focus on people quality, yet they are wonderfully generous in helping people they sack find a new start elsewhere.
  1. The best people to exploit the opportunities created by inefficient technology or business process are already in your team. You don’t need armies of consultants selling ‘agile’ projects or ‘strategic’ reviews. Simply ask everyone in your business if they were to start a FinTech what would they do? Most will suggest ideas based on their first-hand experience – it’s where their ideas and their experiences map to each other that the real opportunity lies.
  1. High quality engineering does not have to be expensive to implement. Banks are rightly cautious about reliability and security, and tend to over-engineer technology projects. This might be the right approach if you’re rebuilding the General Ledger, but if you are just trying to test an idea to see if it has legs, optimise to fail fast, and build incrementally.
  1. When you think you’re on to something – build software in as highly modular fashion as possible. Banks should be upgradeable, like PCs and not throwaway like cars. Most of the Banks we see around us are like 1980s sedans. They’re still running but cost a small fortune to maintain.
  1. Innovation is a mind-set, not a destination. When a Bank has its innovation function separate from its core team, it will never truly innovate.
  1. Automation is imperative, but go into it with your eyes open. Most of the Robotic Process Automation tools being sold are simply 21st Century macros. You’ll end up hard wiring bad business process. Sometimes there are pragmatic reasons to go ahead, but if there are, be clear about why you’re doing it.
  1. A better approach is to keep your eyes on the ‘art of the possible’ both today and just around the corner. This way you’ll select technology to solve the problems in front of you, as well as defer solutions, sometimes by months or years, until the right approach comes along.
  1. Don’t be constrained by perceived limits in technology adoption. A senior Banking technologist told me recently that “technology is the easy bit, people change is hard”. This is a prevailing view, and couldn’t be more wrong. The best technology projects require no change budget. How much training did you allocate to rolling out iPads? None. The best technology fits users like a bespoke suit. If you can imagine a perfect solution, chances are someone can build it for you.
  1. Be honest about automation. Introducing ‘productivity enhancements’ when your strategy is to cut the workforce is disingenuous to the extreme. Banks need to automate if they are to survive the threat of tech companies, but they need to do so in a responsible and ethical way. Only by having a conversation in the open with staff, shareholders, stakeholders and society and working with these groups will you demonstrate true leadership. For at the heart, like any great business – it’s all about the people.