Page 1

Britain keeps on spending ...

The German retail market is the largest by volume. The UK, however, is the largest both as a proportion of GDP as well as in absolute e-commerce Figures

€391bn Store-based retailing sales

€14bn Non-store based retailing sales

BearingPoint Institute Report Issue 003 - Extract

€349bn

g out of favour with the markets

thetoinfrastructure s, the price-to-book value of banks has droppedBridging significantly relative other sectors €21bn

€8bn

€38bn

finance gap?

Before the financial crash banks were prepared to Internet finance long-term infrastructure projects. H 2002 2004 2006 2008 2010 2012 retailing sales restrictive regulations, it is now more difficult for them 6 to provide loans with long ma

2000

MSCI U.S.

MSCI Europe

Banks 5 are shortening their GERMANY loan maturities as €2,644bn they are increasingly (GDP) constrained by 4 Basel III

MSCI MSCI U.S. banks EU banks

Risk level

Trends

€382bn

€6bn

UK €1,907bn (GDP)

Maturities after financial crisis

3

€20bn

€117bn

€2bn

€8bn

2

Bank loan

€2,038bn Bank loan

€1,047bn (GDP)

1 POST-FINANCIAL ARE INSURERS THE CROSS-CHANNEL phase Operational phase COMMERCE CRISIS Construction BANKING NEW BANKS? (3-4 years) (20-40 years) (GDP)

Source: IIHD Research, Euromonitor, Statista, ECB, IMF

Not to scale and for an illustrative Source: Bear

... while France is yet to ‘click’

... Germans stay frugal ...

France 0exhibits the lowest share of online buyers (63%), whereas the projected growth of online buyers is by far the highest (21%)

In 2012 selling space productivity in Germany was more than 20% lower than in other European countries

unprecedented pressures, a possible sign European o come Strategies

project finance volumes are lower than 2005 le

Volume by source, 2005–2012 in $billions Online buyers as a Moving hospitals from curing to caring percentage of population al dilution Job cuts 3,219 €7bn lawsuits Retailing sales 4,043 69% EUR/m selling 127 GERMANY -61% ntal capitalInnovation injections aren’t without frontiers Across major European banks UK Against major European 2

space, 2012

f of the money injected has es and, 5 years on, more is still w Basel III requirements

32,000

75%

72%

7

2 30,000

45

95

667 TOTAL ASSETS Decline of growth 57

TIER-1 CAPITAL

86

59 10 0 41

12,959

93

NORDICS

14

20.6%

FRANCE

82

Source: IIHD Research, Forrester Research Inc.

roughly two-to-one

Interview 56 8 €3.65bn Crédit Agricole’s community-based mobile strategy 2010 2011 2012 2009 Embargo

13.3%

UK

63%

Source: IIHD Research, Euromonitor

11

17.4%

GERMANY

banks since 2009

Opinions 19 more lay-offs 110 With to come as the industry 3,963 Measuring innovation 4,198 restructures, many will 9 Tier-1 Situational capital and awareness in Chicago 18 leave theFRANCE shrinking sectorNORDICS total assets, €billion for good as redundancies 80 Why China now? outpace new hires by 1 34,000

Growth of online buyers

1

12 1

67

61

13.9%


Editorial 2

Peter Mockler Managing Partner – BearingPoint Willkommen, bienvenue, welcome! Innovation is a strong theme in this third edition of the BearingPoint Institute Report. As the economic turmoil starts to ease, opportunities are emerging for businesses and organisations to take the lead by embracing change and adapting before the competition. In some sectors change is mandated by regulators; in others evolving consumer behaviours are forcing a rethink. Common to most opportunities is the need to drive innovation, evolve business models and engage more closely with customers and clients. European banks face the dual challenges of a tightening regulatory framework and mounting commercial pressures. Our analysis shows that cost efficiency savings and risk-adverse policies only go so far in this post-financial crisis environment: agility together with innovation is the key to future growth. For instance, we learn in an interview with Crédit Agricole how the bank took the radical step of opening its customer data and enabled a community of developers to co-create mobile banking applications with, and for the benefit of, their customers. For insurance firms, a golden opportunity is knocking at their doors: the European Commission estimates that EUR 2 trillion of infrastructure investment is required to meet its Europe 2020 growth agenda. Our study shows that insurers are keen to bridge this financing gap, thus diversifying the ecosystem of infrastructure investors currently dominated by banks and industrial investors.

are driving bricks-and-mortar retailers into a ‘race to the bottom’, disadvantaging them in the battle against online shops. We look at how an integrated cross-channel commerce strategy can be the basis for innovation and differentiation. Flick though for more on how innovation is taking place across industries, from how hospitals can move ‘from curing to caring’ to the city of Chicago deploying situational awareness, read why Western companies can learn about ‘inclusive innovation’ from developing countries or should consider ‘why China now?’ The BearingPoint Institute is also innovating: this Issue 003 features more themes, a more concise and graphical presentation, and summaries in French and German. There are also video interviews with the authors, directly accessible on the device of your choice and from any format – print with augmented reality (see the Layar instructions below), iPad, Android, eBook or web. We hope you enjoy the issue. Please do drop us an email at editor@bearingpointinstitute.com to tell us what you think.

CONNECT Follow us on Twitter at @institute_be Join us on LinkedIn at www.inst.be/linkedin Web: www.BearingPointInstitute.com Email: info@bearingpointinstitute.com

Meanwhile dramatic changes to consumer behaviours, coupled with weakened spending power, INTERACTIVE PRINT

BearingPoint Institute Report Issue 003

Download the free Layar App

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Contents

BearingPoint Institute Report Issue 003 OPINIONS

4

Five steps for European banks to shape up

Europe’s post-financial crisis regulatory regime is evolving fast: our study shows banks have to respond with proactive innovation, not squeezing margins

30

Are insurers the new banks for infrastructure investments?

We analyse the opportunities and options for insurers to ramp up their large-scale infrastructure project investments, as banks and governments scale back theirs

60

Can cross-channel offer Europe’s retailers a more certain future?

Our survey shows cross-channel commerce is a priority for retailers, yet adoption is slow; we detail the strategy options available to them to avoid the ‘race to the bottom’

STRATEGIES

78

Hospitals: from curing to caring

Influencing the behaviours of patients can greatly improve the quality of healthcare delivery according to our survey and case studies

Innovation without frontiers

102

Western businesses can learn lessons from emerging economies to break out of existing thinking and unlock innovation

56

Can innovation be captured, bottled and measured?

What are the underlying features of innovation, and how can they be harnessed?

Situational awareness and the City of Chicago

94

Situational awareness can help organisations use the information at their disposal to improve how they engage with customers and deliver services; the City of Chicago shows us how

Catching the second wave of growth in the Middle Kingdom

118

A BearingPoint China perspective on the country’s changing role in the global economy and the new opportunities this brings for Western businesses

INTERVIEW

Crédit Agricole: 22 accelerating into the digital era with co-creation Michel Goutourbe, deputy GM at the mutual bank, details their award-winning app store builds on open data and co-creation

HIGHLIGHTS 122 What personality is your company? Daring to take a ‘bottom of the pyramid’ approach ICT and health systems in Africa

BearingPoint Institute Report Issue 003

3

3

TRENDS


LEADERSHIP TEAM

About BearingPoint

Per Jacobsson, BearingPoint

Managing Director, i2 media research ltd. & Senior Lecturer, Goldsmiths, University of London

BearingPoint consultants understand that the world of business changes constantly and that the resulting complexities demand intelligent and adaptive solutions. Our clients, whether in commercial or financial industries or in government, experience real results when they work with us. We combine industry, operational and technology skills with relevant proprietary and other assets in order to tailor solutions for each client’s individual challenges. This adaptive approach is at the heart of our culture and has led to long-standing relationships with many of the world’s leading companies and organisations. Our 3350 people, together with our global consulting network serve clients in more than 70 countries and engage with them for measurable results and long-lasting success.

Prof Dr Fons Trompenaars

www.bearingpoint.com

Mike Kronfellner, BearingPoint Ludovic Leforestier, BearingPoint ADVISORY BOARD Denis Delmas President of TNS Sofres, Vice-President Europe and Board member of TNS Group Dr Jonathan Freeman

Founder and owner, THT Consulting Dr Victor Vroom Professor of Management and Professor of Psychology, Yale School Management EDITORIAL TEAM Ludovic Leforestier, BearingPoint Jean-Michel Huet, BearingPoint Jonathan Stephens, BearingPoint PRODUCTION Michael Agar, Michael Agar Design Jon Collins, Inter Orbis Tanja Dietenberger, BearingPoint Chris Norris, CopyGhosting Andrew Rogerson, Grist Angelique Tourneux, BearingPoint

CONNECT Follow us on Twitter at @institute_be Join us on LinkedIn at www.inst.be/linkedin Web: www.BearingPointInstitute.com Email: info@bearingpointinstitute.com

About the BearingPoint Institute At the BearingPoint Institute, our ambition goes beyond traditional ‘thought leadership’. We aim to contribute original ideas to the science of business management while equipping decision-makers with practical advice gained in the field and through our research projects. www.bearingpointinstitute.com

Share your thoughts Every change we make at the institute is with our readers in mind. Please share your opinions with us so we can work to make these reports as good as they can possibly be. Visit www.inst.be/ feedback.


ISBN: 978-0-9576165-2-3 (Print edition) ISBN: 978-0-9576165-3-0 (Digital editions)

Š 2013 BearingPoint Holding B.V. All rights reserved. Printed in the EU. The content of this document is subject to copy right. Changes, cuts, enlargements and amendments, any publication, translation or commercial use for the purpose of trainings by third parties requires the prior written consent of BearingPoint Holding B.V. Any copying for personal use is allowed and only under the condition that this copy right annotation will be mentioned on the copied documents as well. All information supplied in this document is correct, to the best of our knowledge, at the time of publication. Printer Le RÊveil de la Marne

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Bearingpoint Institute Report - Issue 003  

Innovation is a strong theme in this third edition of the BearingPoint Institute Report. As the economic turmoil starts to ease, opportuniti...

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