Banking in the Flat World
A View Point
Maximize Opportunity. Minimize Risk.
Banking in the Flat World Means…
• Hyper-informed and increasingly demanding customers
• Shifting competitive landscape and disruptive business models
• Leveraging technology for greater efficiency
• Lowering costs by leveraging global talent pools
• Emergence of more regulations and challenge of compliance
Win in the flat world
Four Key Forces Flattening the Banking World
Win in the flat world
Force # 1 Emerging Economies
• Banks increasing focus on BRIC
economies as emerging ‘engines of
growth’
• Increasing cross border M&A’s
• Banks sighting opportunities to leverage
global talent pools
• Reverse osmosis from BRIC nations Emerging banks coming into the global
market with leaner and disruptive
business models
Win in the flat world
Force # 2 Shifting Demographics
• Increasingly diverse but lucrative
markets
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Growing minorities
Migrant and mobile population
More bankable age groups
Mass affluent
• Increasing complexity
– New solutions like Islamic banking
address key growth
– Cross border investments and
borrowings
– Banks forge global relationships with
corporate customers
Win in the flat world
Force # 3 Ubiquity of Technology
• New technologies emerging across the
value chain
– Stronger and improved capabilities for
customer acquisition, operations and risk
management
– Increasingly being viewed as a
differentiating tool
• Technology swiftly traversing the realms of
operation to strategy
– Collaborative platforms, analytics,
workflows
– SOA (Services oriented Architecture)
– BPM (Business Process Management)
Win in the flat world
Force # 4 Regulation and Compliance
• Not a choice but a mandate
• Opportunity to implement technologyenabled holistic enterprise risk
management and compliance strategy
• Time-to-compliance increasingly critical
• Technology spend to achieve
compliance is consistently on the rise
Win in the flat world
The Sum Total of These 4 Forces?
BANKS FIND THEMELVES COMPETING ON A PLAYING
FIELD THAT’S LEVELLED
Win in the flat world
Bank Must Shift to Win in the Flat World
Win in the flat world
Set the Direction To Make The Strategic Shifts
Leverage the six key enablers to win in the flat world
Win in the flat world
Maximize Globalization
• New and qualitatively higher levels of
globalization
– Opening up of BRIC economies
– Access to mature markets
– Opportunity for consolidated global financial solutions
• Global regulatory convergence
– Regulators converging on viewpoints and perceptions
– Banks globally need to comply with same or similar regulation –
Basel II, KYC, AML
Win in the flat world
Maximize Innovation
• Innovate across product, service and channels
• Leverage technology to drive innovation
• Take innovation beyond channels into process
and customer experience and drive customer loyalty
• Integrate innovation into the core business process,e.g
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Bundling of products
Segmented service level agreements
Customized re-payment schedules
Relationship based pricing
Predictive banking
• Increase speed of innovation and lower cost of innovation –
critical for success
Win in the flat world
Maximize Diversity
• Cater to diverse customer requirements
– New segmentation strategies
– Advanced analytics and micro segmentation
– Relationship-based pricing
• Managing customer convenience across channels and
borders
• Opportunity to create new lines of business
– Islamic banking
– Wealth management
• Localize products and services for greater customer intimacy
Win in the flat world
Maximize Agility
• Speed of response to competitive
pressures and regulatory challenges
• Proactively identify and seize opportunities
• Assimilation of new generation technologies
– SOA, BPM, Internet and mobile banking
• Agile technology foundation
– Migrate from legacy systems to new generation technology
platforms
Win in the flat world
Minimize Risk
• Manage risks in the transformation eco-system
– Compliance, market, currency, political, cultural
and technology
– Strategy, finance, process, transition and operations
• Evolve Enterprise Risk Management (ERM) strategies
– Structure, process, people and technology
• Pick the right partner for the transformation journey
– Impeccable credentials
– Highest predictability and transparency
– Long term stability
• Effective leadership for the transformation journey
Win in the flat world
Minimize Cost
• Reinvent operating model for reduced complexity,
greater standardization and lower costs
• Create lean operating model
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Global sourcing
Product factories
Global and regional processing hubs
Process standardization
• Process Orchestration
– Adopt enterprise BPM technologies
– STP – higher productivity, streamlined operations and lowered
costs
Win in the flat world