Open Innovation: a key competitive factor for banks
GFT study reveals: financial institutions must be open to external initiatives
Stuttgart, 4th March 2014 – A bank asks its customers what it could do to improve and then awards a prize for the best suggestions. Another includes its employees in the development of new service standards. Just two examples that are rooted in the idea of ‘open innovation’. What is special about this: external partners, with all of their experience, expertise and skills, are specifically included in the innovation process. The potential that open innovation yields for banks has been captured in a new study released by GFT, a leading international IT solutions providers to the financial sector.
“The market conditions for financial service providers are changing increasingly rapidly,” states Marika Lulay, Chief Operating Officer at GFT. New technologies are forcing their way into the market and compelling bankers to make a move or be left behind – digitally. “The financial crisis had a rapid impact on customers, whose loyalty plummeted. That’s why it’s increasingly important for financial institutions to differentiate themselves with innovative products and services – including from new competitors.” Examples of such competitors are e-commerce companies or businesses offering payment services. In essence, everyone wants a piece of the action.
The GFT study, “Open Innovation in the Financial Services Sector – why and how to take action”, reveals how banks can deal with the new pressures of innovation. Momentum to change does not just come from within, i.e. from in-house development departments, but rather from external sources. External partners – suppliers, customers, designers or partner companies from different industries – are the ones shedding new light on the issue of innovation. The advantage: they are often much closer to the target group or can infuse stale ideas with fresh, new, out-of-the-box thinking.
According to Marika Lulay, “Traditionally, banks do tend to be early adopters of new technological solutions, but these innovations are generally geared towards the institution itself and the processes it has running in the background. In the digital economy, however, it’s important to make the customer benefit more visible and tangible. In other words, in many cases banks must completely rethink their approach to innovation.”
The study includes examples of successful open innovation programmes, revealing just how broadly the new methods can be applied. These range from crowdsourcing (where end-customers are included in the development of products and services) to corporate venturing (where companies invest in start-ups). For companies thinking about implementing open innovation themselves the important thing to note is that the approach taken must tie in closely with the company’s overarching strategy. After all, the key to successful open innovation is a willingness to open the door to ideas from outside the business.
GFT study to be presented at CeBIT on 12th March
The GFT study – ‘Open innovation in the financial services sector – why and how to take action’ – is available for free. Simply visit the GFT website for details.
In addition, GFT will be presenting key results of the study at this year’s CeBIT in Hanover. The presentation will be held on the CODE_n stage in Hall 16 on 12th March, starting at 12.45pm. Dr Ignasi Barri, one of the study’s authors, will present key findings. The authors of the study will be available for discussion throughout the week of CeBIT.
About the GFT Group:
The GFT Group is a global technology partner for future digital issues – covering everything from discovering innovation to developing and implementing sustainable business models.
Within the GFT Group, GFT stands for competent consulting and reliable development, implementation and maintenance of customized IT solutions. The company is one of the world’s leading IT solutions providers in the banking sector.
emagine offers companies the opportunity to staff their strategic technology projects both quickly and flexibly with capable experts. To achieve this, emagine has an international network of highly qualified IT and engineering specialists at its disposal.
CODE_n, the GFT Group’s innovation platform, offers international startups, technology pioneers and established companies access to a global network. It’s where ideas become business.
Headquartered in Germany, the GFT Group has stood for technological expertise, innovative strength and outstanding quality for over 25 years. Founded in 1987, the GFT Group expected to achieve revenues of around €260 million in 2013. With a global team spanning 2,000 employees, the company is represented in eight countries by its 32 local offices. The GFT Group is listed on the Frankfurt Stock Exchange (Prime Standard).