MANAGING INNOVATION: ORGANISATION
Forging ahead Stephan Hartgers, VP of Digital Strategy at Mobiquity, and Lieven Haesaert, Global Lead for Innovation Transformation & Management at ING, discuss the importance of methodology and organisational structure in creating great ideas Innovation, by definition, is never ‘done’: it’s an endless quest to do better, do different, and do right. When it comes to digital finance, Dutch banking giant ING has been on that innovation mission for the better part of five years, with notable success: it was named western Europe’s most innovative bank in 2020 and its ING Ventures €300million fintech fund, which currently holds more than 30 investments, was awarded most active fintech Corporate Venture Capital fund in Europe. The ING Labs, in Amsterdam, Brussels, London and Singapore, have so far been responsible for open banking platform Yolt, the multi-bank portal for corporate accounts, Cobase, and bond analytics platform Katana, while working on a host of other, internal solutions that might yet also find a commercial future outside of the bank. But it still felt it could improve. ING recognised there were roadblocks, constraints to idea generation and realisation, within the existing organisational structure of the bank. So, in October 2020, it announced that its multiple innovation programmes were being rolled into a single, independent business unit: ING Neo. It will ‘create space for breakthrough innovation’, as Annerie Vreugdenhil, previously lead for Wholesale Banking Innovation, who moved across to head up the unit, has described it. ING Neo will be focussing (as in fact the bank did www.fintechf.com
before but perhaps in a more fragmented way) on ’value spaces’: where it can improve client experience of its services, specifically around housing, lending, trade, financial health and compliance. Stephan Hartgers, VP of digital strategy at Mobiquity, a ‘full-service digital transformation enabler’, which has worked with banks across the world in helping them manage their approach to innovation, takes his hat off to ING’s achievements so far. And the new organisational approach is, he says, a mark of maturity in this space. “Banks saw the opportunity to jump on the innovation management cycle and be competitive against the challengers, in order to stay relevant for the future, as well as securing future revenue streams,” he says, but now they need to take a more structured approach. He’s seen three trends emerge in banks’ innovation strategy: optimisation of current banking practices, evolution and adoption. “Maybe the innovation factory [in a bank] started by collecting all the random ideas that were floating around the company and putting them on a list. There would be hackathons, or boxes where employees could submit their ideas. That was just the first iteration of idea generation,” says Hartgers. “What we see now is a strategic framework emerging. There can be
tools or concepts applied – the innovation thesis – that really sets out where to innovate and where not to. Then the concepts become much more targeted on where a clear potential to disrupt exists – what ING calls value spaces. That’s where to play, how to win. At this stage, there is more investment needed; otherwise, the pipeline of ideas will dry up and your innovation factory comes to a halt. “Where investment was initially made into understanding the concepts – around user validation, prototyping and building minimum viable products (MVPs) – now those ideas need to be proven to be able to generate value. And if it has value for the customer, it also has value for the organisation,” says Hartgers. At this stage – building them into products that generate the value that’s been promised – other people and other capabilities are needed. The journey through this innovation funnel can be hazardous for ideas – it’s meant to be a testing process, after all. But life can be just as dangerous for those that are safely delivered from it and make it through to the final stage – adoption. This is where they need careful nurturing. And it’s a lesson ING learned the hard way. “You can spin them back into the business; but sometimes you spin them in too fast,” says Lieven Haesaert, ING’s global lead for innovation transformation and management. Issue 20 | TheFintechMagazine
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