Future of Financial Services: 2020 series

How will you make the most of your competitive potential in 2020 and beyond?

Our thought leadership series provides insights on the way forward.

There are huge forces at work in the global economy today spurred by shifts in global economic power, economic change, urbanisation, demographic changes, technological advances, and more.

Each of these forces will shape our lives in many ways, but for the financial services industry, as the post Financial Crisis regulatory wave retreats, technology stands above the rest.

Seeing the future clearly and developing a proactive, strategic response – rather than simply reacting to events – will set apart the winners from the losers in a fast-evolving market.

In our Future of Financial Services Series, we look at these changes, and offer some suggestions on how to prepare for the opportunities and threats ahead.
 

Banking Matters: Hot topic

Future operating models 

It is evident the banks are taking large steps to respond to the challenges faced by the market, taking advantage of technological opportunities and responding to a faster-moving environment; reshaping their cost bases in the process. We believe this reflects a broader realignment that is taking place around operating models. As the banks truly focus on their points of difference, we expect to see more attention on how their operating models need to change to support these capabilities and maintain performance. Our Hot Topic: Future operating models sets out a series of different approaches that could be taken to help banks ‘win’ in the future.

Download the hot topic

The Future of Life Insurance in Austraiia: Profitable growth in challenging times

An industry with a noble purpose doing it tough

If the shake-up in other commercial sectors teaches us anything, it is that no business is immune from today’s rapid and relentless shifts in technology and customer expectations. For life insurance, this is no exception. Faced with a rapidly evolving and potentially disruptive set of market dynamics; including technological advances, foreign entrants, media scrutiny, and diminishing customer trust; the industry must now have absolute clarity around its purpose, intent, and capability. In this context, the most competitive life insurers going forward will focus on a ‘way to play’ in the market, will identify a differentiated proposition aligned to the customer, and will look to optimise their competencies – and concentrate on their core.

To help an industry doing it tough, our paper focuses on:

  • The state of the industry and the forces that are set to transform it
  • Five ‘table stakes’ capabilities that life insurers will need to focus on
  • Archetypes for life insurers of the future
  • Six key questions life insurers should ask to assess their readiness for the way forward.

Download the full report

Escaping the commodity trap: The future of banking in Australia

Simpler, smaller and more deeply connected to customers

The Australian banking sector is in a state of flux. Renewed debate about culture and reputation, as well as uncertainty around the pace, scale and breadth of strategic disruption to the industry, mean that the bank of the future will look very different to the bank of today. Bankers, regulators, directors and investors would do well to ask:

  • What is the state of Australian banking today, and how is it changing?
  • How should the industry respond to these changes, and what will it look like in the future?
  • What can individual banks do today to win in the new environment?

Six powerful forces are shaping the banking industry in Australia today: changing demographics, technology, consumer behaviour, Asia, government and a subdued global economy. These forces are driving change at precisely the time when traditional value drivers for the industry – asset growth and, to a lesser extent, leverage – are dissipating, and may even reverse. As a result, return expectations and the future outlook for the industry are being revised down with almost every earnings announcement.

To continue creating economic profit for shareholders, banks need to become simpler and smaller, but more deeply connected to customers than they have been in the past. How? We propose six fundamental priorities for banks in the years ahead:

  1. Explicitly organise around the customer.
  2. Simplify the offer, face and voice. 
  3. Optimise the footprint throughout the value chain. 
  4. Focus on specific areas of innovation. 
  5. Proactively embrace regulation. 
  6. Put culture to work.

The winners – those who can successfully navigate this landscape – will also be more valuable than they are today. They will have more diverse sources of income and more sustainable economic profit. But this will not apply to everyone, and possibly not even to the industry as a whole.

For perhaps just the third time in three decades, the industry is poised for fundamental realignment. Managing this transition, and the timing of necessary changes, will be crucial to success in the years ahead.

Download the full report

Fit for Growth in Financial Services Organisations

Practical lessons from Asia and Australia

Financial services organisations across the world are having to face a number of challenges which is resulting in many spending money in the wrong places. In our years of experience and research, we have found that if your purpose is to serve customers and protect their futures, and you can cope with lower profits, then you need to get yourself into the best position to compete more effectively. Strategy&’s Fit for Growth in Financial Services Organisations report sets out five fundamental things your leadership team must get right to transform successfully.

Find out more


Full publication list: Future of Financial Services Series














Contact Us

Julie Coates

Financial Services Industry Leader, Sydney

Scott Berryman

Financial Services Industry COO, Sydney

Ewan Barron

Partner - Assurance, Sydney

Peter Burns

Partner, Strategy&, Sydney

Renae Cooper

Leader - Financial Services Diversity and Inclusion, Sydney

Craig Cummins

Leader - Superannuation, Sydney

Scott Fergusson

Leader - Insurance, Sydney

Colin Heath

Leader - Banking and Capital Markets, Melbourne

Anthony James

Leader - Asset and Wealth Management, Sydney

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