Bank and agile – a contradiction in terms?

Private & Institutional Investors , How we work , Innovation 20.09.2019 by Roger Studer
Reading time: 2 minute(s)

The word ‘agile’ is not often associated with banking. But, agile organizational elements can be successfully integrated into bank operations. Vontobel has many years of experience in this, and is interested in incorporating more.

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Nowadays, every company wants to be ‘agile’ to be able to deal with the accelerated pace of digitization that has taken many firms to their limits in trying to adapt to new regulations, technologies and customer needs. A business organized to be agile seems like a solution, potentially enabling innovation and a systematic focus on the customer. Who wouldn’t want that?

Agile organization – it pays off

Banks find it particularly difficult to be agile because they operate in a highly regulated environment in which flexibility and speed are sharply restricted. While it is not possible for a bank to become agile in every aspect of its operations, banks can learn from other firms and adapt from them in many, if not most, organizational areas.

That is precisely our approach at Vontobel, which gives us a distinct advantage over many competitors, for whom ‘change the bank’ projects often pose huge challenges.

Vontobel has had an agile approach for years, but major steps were taken few months ago to align the organization towards even greater agility, and looking back I can say that it was certainly the right move, and on several levels at that.

Integrating change into day-to-day work-life

Being agile as an organization is essentially about integrating change into the way business is run on an everyday basis. The result is an ability to continuously evolve one’s business practices and business models.

As part of this, we opened up the organizational structure of our investment banking unit. Marketing, legal, software development and UX developers were all integrated into the business unit so as to have all parties affected by the changes close by.

Project teams formed within the business unit

Projects to further develop products or processes are conducted within the business unit affected. The business owner manages interdisciplinary project teams located within the business itself. The advantage: no time or information losses between business owner and business engineer, product management, software engineers, legals, etc.

Reducing interfaces and organizational structure saves time that would otherwise have to be spent explaining the business model and business requirements to the new project teams.

Another advantage: Project managers previously handed over the result to the Business, which was then on its own in terms of handling the project outcome. But today, those involved in a project remain responsible for it within the Business after its completion, observing first-hand the project’s impact in day-to-day operations.

The benefits for customers

The new approach taken has put us closer to our customers. Up until two years ago, the practice at Vontobel was to decide what products we want to provide to customers. Today, in contrast, we ask customers what their needs are, then seek to fulfill these needs in a timely manner. And getting useful results rapidly to market requires flexibility as a precondition, and this provided by an agile organization.

The resulting benefits for us are two-fold: we can thus give customers what they need from a position of maximum possible proximity to them. Being involved in designing a product, a program function or a service makes these customers feel appreciated, which in turn makes them better ambassadors for our products.