Video
Traditional operating models can hold banks back from implementing distinctive strategies. Thomas Olsen, a partner with Bain's Financial Services practice, outlines four things banks are doing to develop new operating models that can adapt for the future.
Read the Bain Brief: New Bank Strategies Require New Operating Models
Read the transcript below.
THOMAS OLSEN: New technologies, regulation and competition are forcing banks to develop new strategies. And developing a new strategy that's differentiated versus competition is difficult, and involves hard choices. But many banks today are finding it easier to decide what to do than how to do it. In other words, how to get from here to there is the big problem, and banks' own operating models are one of the biggest obstacles. Still today, most banks still have similar traditional operating models that were not designed for the increasing levels of digitalization, and are burdened by the legacy IT systems, legacy processes and structures, and legacy talent pools. And all these stand in the way of change, and are painful for banks to address.
Now, we see the banks are making the best progress on this doing four things differently. They are externally focused, engage in ecosystem of vendors, suppliers, partners and fintechs. They focus their design around client priorities, not around products or processes. They get Agile fast, and not just for IT projects, and they are getting creative, and even aggressive, in finding and redeploying new types of talent. The real question for bank executives now is, how much time do we have? Technology disruption and expectations are not letting up, and the banks that tackle the operating model overhaul now will be much better able to deliver new strategies and adapt in the future.
Read the Bain Brief: New Bank Strategies Require New Operating Models