SETTING STRATEGIES FOR UNCERTAIN TIMES

+ Business Case: Transforming analytics into actions!

World Forum Disrupt | London, 18/01/2017

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• Innovation is a “state of mind” not anaction

• Disruption comes from people not fromtools

• The future of modelling relies on data availability and analytics

• Institutions should adapt their policies to retain non-aligned people

• Innovation is not “catching-up”

Preliminary Statement

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Introduction

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Winning Strategies

Identify The Big Issues: What is pulling you back?

How do you differentiate yourself?

What is your vision? Do you tackle an issue of fix a probleme? Do we need this product/ Company?

Plan properly

Make sure that you organisation is effective and can deliver! Is your culture adequat? Measure and assessyour effectiveness, your risk, etc…

And Just Make It Happen!!!!

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• Hawley’s Risk Theory of Profit• Clark’s Dynamic Theory of Profit• Schumpeter’s Innovation Theory of Profit• Walker’s Rent Theory of Profit• Knight’s Theory of Profit

Theory of Profit: Frictions

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• The Innovation Theory of Profit was proposed by Joseph. A. Schumpeter.

• Innovation refers to any new policy that an entrepreneur undertakes to reducethe overall cost of production or increase the demand for his products.

• Profits earned are for a shorter duration as the competitors imitate the innovation.After some time, with the others imitating the innovation, the profits starteddisappearing.

• Thus, innovation can be classified into two categories;

1. activities which reduce the overall cost of production such as theintroduction of a new method or technique of production, the introduction ofnew machinery, innovative methods of organizing the industry, etc.

2. activities which increase the demand for a product. Such as theintroduction of a new commodity or new quality goods, the emergence oropening of a new market, finding new sources of raw material, a newvariety or a design of the product, etc.

Schumpeter’s Innovation Theory of Profit

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Innovation Must be Dynamic!!!

New Asia Innovation

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• Company culture is the personality of a company.

• It defines the environment in which employeeswork.

• Company culture includes a variety of elements,including work environment, company mission,value, ethics, expectations, and goals.

• The impact of the company architecture and theorganisational chart is non-negligible as it will impacthow innovation hubs should be positioned.

• Is your strategy compatible with your culture?

Company Culture

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“Evolve or die” A Cultural ChangeA recent Harris Poll survey of top business leaders found that 65% felt increased pressure to innovate.

• Innovation only comes by invitation. Invite people to bring forth their new ideas.

• Innovation is not a solo sport, it requires a group of players with skills specific to the effort.

• Encourage everyone to put their ideas to test fast, fail fast, and then reiterate.

• Value the lessons taken from failure as much as your successes, and apply those lessons toward each new attempt.

• Ensure this behavior gets modeled at every level, from the very top to individual contributor.

• Resist the desire to project manage your way to innovation.

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Where to Locate the Innovation Hubs?

• Innovation centers fall into four broad categories, according toCapgemini/Altimeter’s research. They are:

• in-house innovation labs: In-house innovation center serves as aninnovation engine, with hundreds of staff performing everything from inceptionto prototyping.

• university residences: The university residence model sets up centers oncampus to drive innovation through academic researchers.

• community anchors: Community anchor innovation centers actively identifymentors and provide opportunities for startups to work with the company totest new products on customers.

• and innovation outposts: Innovation outposts are small teams based in technology hubs like Silicon Valley. This allows large companies to be involved in the tech community without a significant investment upfront.

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Convoluted and Dynamic Strategies

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So Let’s Measure!

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Application: The New Banking Ecosystem

Disintermediation and automation• More alternatives for daily banking

without banks

• Specific offerings from TPPs (PSD2)

• Robo-advice

Price erosion• Increase transparency

• + Ease of switching

• = Price War

Increased competition• Free access to data to propose targeted,

better, more appropriate offers

• Banks can use data to increase their

share of wallet

New Risks• Cyber

• Conduct

• Strategic

• Model