Once upon a time, in a land far away, a bank killed innovation…

Photo by Leonid Eremeychuk

Once upon a time, in a small and dark country, there was a small bank. Well, actually, it was not such a small bank for this country. It was also an important bank for many people, especially in the countryside, because this bank was also near its customers and the local staff really knew those customers personally and had forged meaningful relationships. 

The leader of the bank had a vision. He saw that banking business would change and that it would be better to act before that change happened. He wanted to drive the change, but he was leading the change from the castle in the heart of the capital, and well away from his customers.

They decided to innovate at the bank. They thought that very basic saving accounts and offering loans with heavy paperwork were not the businesses of the future. They thought it would be a great idea to offer people new services they would really want to use and integrate finance options to those services. People, they thought, weren’t normally looking to them for a finance service so why not to offer them together. They could combine their old strength of knowing customers personally and utilizing modern technology and new services.

They hired many new people. People who had technology competence to build new modern services, people who had created new businesses from scratch, and people who had seen elsewhere that it is better to act before disruption destroys a business.

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These people were excited about new opportunities to build a totally new business. They got freedom to develop new ideas and implement them. The bank was to have a new and more important role in its customers’ lives.

However, there was also a group of traditional banking folk inside the bank and in the finance sector. They didn’t really like that the bank was starting to do something that was not ‘traditional’. They felt the bank had broken the rules and it became difficult for them to tolerate this rebellion any longer.

Other people inside the bank also felt they were not in their comfort zone, with all kinds of new things happening. They complained, that it was confusing. From this an ‘empire strikes back’ plan was hatched.

When it came time to get a new leader for the bank, it became an opportunity for the old banking gang to get control back. They started their work to ensure the next leader would take a step, no, many steps, backwards.

Their plan worked. They managed to get a traditional finance wizard to lead the bank. He had the track record of doing things the traditional way. He had also read more traditional business management best sellers than most airport bookshops stock. He was an excellent leader to implement the ‘empire strikes back’ plan.

It didn’t take long time for the plan to start working. The bank decided to stop new activities, and focus on traditional banking. People who came to the bank to do new things, decided to leave. And those who decided to stay, started to repeat the mantra “it is great to have a clear focus, it was so confusing earlier,” although earlier they had been excited about new things. But they were also smart people and they wanted to protect their positions under the new leader.

The new leader wanted to make it clear, that this was another new era in the bank. He wanted to take the bank back to the local social clubs of the bankers in the country. They didn’t want to use modern digital technology, instead keeping their old IT model and developing it further.

By adopting a puritan management and process consultant attitude the bank not only killed off the innovate trial and learn model, but it also managed to get rid of the traditional strengths of the company – the local presence and personnel that really knew their customers personally. They wanted to take the HSBC, Chase, or you name it model and adopt it to this small bank without realizing even the big banks were struggling with fintech and other disruptions that were emerging.

It was a successful ‘revenge’ by the old banking gang and process consultants. The new innovations and businesses were killed off within a couple of years, and not only that, but the personal touch went too. No one can say they were ineffective because peace did come back to the bank and the local finance community. People in HQ were happy in their comfort zones and continued their old activities as if nothing had happened.

They are now living happily ever after, or at least they will be, until the day the disruption wave really comes and changes everything. In some markets, it might have arrived already!

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