Bank 2.0, The emergence of a new era

Radical Ideas | Practical Implementation

Emergence of Bank 2.0a brief view on a new world

Dr. Jay van Zyl

www.BuiltToThrive.com

www.SystemicLogic.com


Towards a New LandscapeTowards a New Landscape


BANK 1.0


Signs of Change?Signs of Change?

Emergence of habitual based banking Emergence of habitual based banking More interactions, more oftenMore interactions, more often


The “service” era...The “service” era...human or machine?human or machine?

What I say What I say What I doWhat I doSurprise me...Surprise me...

What I say What I say What I doWhat I doSurprise me...Surprise me...

Out of only 16% Out of only 16% that switched...that switched...


Translate innovation into action...Translate innovation into action...

Reputation for innovation creates visibilityReputation for innovation creates visibilityCapture value though enlightenmentCapture value though enlightenment


The potential to enlighten...The potential to enlighten...

re-Emergence of social interactionre-Emergence of social interactionre-Defining the financial experiencere-Defining the financial experience


1950’s1800’s

Passbook

Industrialize

Credit Card

Mass Production

1980s

Debit Card

2000’s

Internet & Mobile Banking

Mass Automation

Banking Historical ViewBanking Historical View

2005 2007 2009

Social Lending

Visa Microtag

Social BankingAdoption

Social Networks

Web 2.0 CrowdsNetworked World


BANK 2.0


The Evolution of Strategic ParadigmsThe Evolution of Strategic Paradigms

Ref: Reframing Business

Co-producer(crowds)

Source

Receiver(market)‏

Production Relationships Organization of Value Creation

CriticalCriticalcompetencecompetence

View ofView ofCustomerCustomer

IndustrialismIndustrialism

Customer baseCustomer baseManagementManagement

Configurable Configurable Social SystemsSocial Systems

BANK 2.0

Adapted from Richard Normann


The Future: Banking ProcessThe Future: Banking Process Bank 1.0Bank 1.0

Processes are Processes are internalinternal, and orchestrated by salaried , and orchestrated by salaried personnel. Confidentiality and privacy of all information personnel. Confidentiality and privacy of all information is paramount in this model.is paramount in this model.

Bank 2.0Bank 2.0 Process of loan and investment evaluation is Process of loan and investment evaluation is

crowdsourced to crowdsourced to communitycommunity. . The firm is responsible to make the right information The firm is responsible to make the right information

available to available to facilitatefacilitate processes, yet maintain confidentiality processes, yet maintain confidentiality on the rest. on the rest.

The firm must provide processes to The firm must provide processes to validate reputationvalidate reputation, to , to support community interaction.support community interaction.


The Future: Distribution ChannelsThe Future: Distribution Channels Bank 1.0Bank 1.0

Channels are Channels are self ownedself owned, including online banking, etc, including online banking, etc Bank 2.0Bank 2.0

No centralised channels. Customer acquisition, and No centralised channels. Customer acquisition, and retention is retention is increasingly viralincreasingly viral in nature. in nature.

...provide the right ...provide the right flow of informationflow of information between between members.members.

...culture has to be ...culture has to be open and transparentopen and transparent, to engender , to engender trust, and promote customer advocacy. trust, and promote customer advocacy.

Everyone in the firm is an advocate, as are all customers.Everyone in the firm is an advocate, as are all customers.


The new Banking Landscape...The new Banking Landscape...


Evolution of Social BankingEvolution of Social Banking

Money Management

Personal Social Loans

Business Social Loans

Social Investing

PaymentSolutions


Emerging Signs Emerging Signs on theon the

Business LandscapeBusiness Landscape


SOCIAL NETWORKS

PARTICIPATIVE CUSTOMER

OBSESSIVE EXECUTION


SOCIAL NETWORKS


Social Network AdoptionSocial Network Adoption


Social Network AdoptionSocial Network Adoption


Social Network AccelerationSocial Network Acceleration



Credit card hacking, so easy?Credit card hacking, so easy?



















New social order developing…New social order developing…


Banking Conference agenda in Second Life:1. Introductions:2. Overview of current events/financial Market3. Brief overview regarding banking in sl

a. What is banking in slb. Safety & Liquidityc. Private Insurance

4. Need for Regulation or at the very least independently verified transparency.

Experimenting with AvatarsExperimenting with Avatars


Challenging the Norm...Challenging the Norm... Mobile Payments Mobile Payments

(OboPay, PayPal)(OboPay, PayPal) Financial Management and Analysis Financial Management and Analysis

(Mint.com, Wesabe, Geezeo)(Mint.com, Wesabe, Geezeo) Account Aggregation Account Aggregation

(Yodlee, CashEdge)(Yodlee, CashEdge) Bill Pay Bill Pay

(Billeo)(Billeo)


Mobile PaymentsMobile Payments


Financial Management & AnalysisFinancial Management & Analysis


Account AggregationAccount Aggregation


Technology to Bypass BanksTechnology to Bypass Banks P2P Lending P2P Lending

(Kiva, LendingClub, Virgin Money, Prosper)(Kiva, LendingClub, Virgin Money, Prosper) Online Payments Online Payments

(Google Checkout, Amazon Payments)(Google Checkout, Amazon Payments) Social Money Social Money

(Buxfer)(Buxfer)


Peer-to-Peer LendingPeer-to-Peer Lending



Social MoneySocial Money


Social MoneySocial Money


OBSESSIVE EXECUTION


Mobilised CapabilityMobilised Capability


ICBC bought 20% of Standard Bank recently for ICBC bought 20% of Standard Bank recently for R36.7billion (about $6-billion). R36.7billion (about $6-billion).

The deal is the largest investment by a Chinese The deal is the largest investment by a Chinese bank outside China.bank outside China.

...currently the world's largest bank in terms of ...currently the world's largest bank in terms of market capitalisation, worth some $319-billion market capitalisation, worth some $319-billion

Standard Bank group is the African continent's Standard Bank group is the African continent's largest lender, with over R1-trillion in assets largest lender, with over R1-trillion in assets (approximately $156-billion) and a market (approximately $156-billion) and a market capitalisation of R145-billion ($21-billion).capitalisation of R145-billion ($21-billion).


Engage to Surprise: Scion.comEngage to Surprise: Scion.com


Idea Ecologies and Customerization:Idea Ecologies and Customerization:Where are the banks?Where are the banks?


SOCIAL NETWORKS


OBSESSIVE EXECUTION

The move towards using the shadow and social based organization is driving new forms of innovation in the service oriented organization.

Customers co-produce and co-design their experiences with providers though crowdsourcing to ensure optimal fit of offering and expectation.

Delivering on the renewed mandates require collective, synchronised and obsessive execution capabilities.