Shaw’s quote can easily be applied to the business world and specifically, relate to the volatile roller coaster ride of industries, which have flourished and floundered in similar fashions, but with their own industry-specific twists. As industries approach these challenges, often as a result of too much poor decision-making and not enough regulation, it makes sense to take a look back into history with a new perspective and embrace the lessons that emerge and apply the wisdom.
A recent study of the path of the automotive industry reveals a somewhat parallel path of the financial industry, specifically relating to the tumultuous era of 2008-2009 into the current state of the financial industry. An examination of the automotive industry’s journey shows that with an open-mind and an industry ready to change, the lessons learned from the innovation and transformation of the automotive industry into what it is today, could help the financial sector regain their footing and make a huge business transformation.
The study, Closing the Gap: What the Banking Industry Can Learn from Automotive, featured in the January 2014 issue of 360° The Business Transformation Journal, highlights that a transfer of concepts from the automotive world into the banking industry is possible.
The study highlighted some key findings that would help the financial industry make the transformation, which includes:
- Banks must close the gap between the customer and the production view and align their promises to the customers with what they can reliably deliver based on their back office processes.
- Banks need to reduce individualization for the customer and strengthen standardization and simple solutions in product development and production, and must ensure the full traceability of products.
- Creating an industry-wide taxonomy, much like the automotive industry did in terms of bill of material concept, could be the most underrated change needed.
- If banks want to build real customer trust and keep customers in the long term, they should not just follow the new regulation, but become proactive.
Overall, the financial sector must undergo a transformation leading to a more trusted industry and perform to the standards of what customers want and expect. The key ingredient to this transformation is skill and will – two things the industry might not have in its current state.
For the full report and a more in-depth look at the industries and their side-by-side comparison, read the research study, Closing the Gap: What the Banking Industry Can Learn from Automotive (p16), in 360° The Business Transformation Journal.
The 360° – the Business Transformation Journal is produced by the BTS Business Transformation Academy, a thought leadership network devoted to providing cutting edge insights on innovation and business transformation.
By Jen Cohen Compton - President and Founder of Something Creative LLC.