Financial-services

The value of – and for – people is becoming more important

The relationships between employees, customers, and organizations are changing. Even companies in the financial sector are now dealing with:

• Customers and employees who have a need for a relationship that is based on trust and transparency;
• The development of new ways of working, new forms of organization that allow room for (social) innovation;
• Customers’ need for alternative forms of advice, prompted by a more human-oriented attitude towards the economy;
• A growing need among customers and employees for a socially responsible way of doing business, involving topics such as ethics, health, and happiness;
• An increasingly connected world, in which customer experiences are increasingly about ‘fun’.

In short, the value both of and for people is becoming more important. Organizations want to be a ´Great Place to Work For and With´, with attention paid to people and society. The financial sector also has to embrace these developments, not only to meet customer needs, but also to meet the needs of employees. The war for talent has only just begun.
 

Developments in the financial sector

The financial sector is unstable. Paradoxically enough, this is the result of government intervention and the need of financial service providers to build up more own capital:

The government is steady as a rock now, but that rock will be retreating soon.
The global economic crisis has not only led to significant damage to the image of the financial world; banks and insurers now also have to deal with much stricter supervision and compulsory interventions in terms of how they do business, such as the mandatory unbundling of banking and insurance activities. In some cases, central governments are even taking over the reins. What the market is now finding is that these same governments will at a certain point want to divest themselves of banks. And this will have a negative effect on the stability of the financial sector.

Having a healthy amount of own capital is good for the risk profile of financial service providers, but the road to acquiring this capital is littered with divestments and mergers.
Because banks and insurers have to adapt their style of risk management, they are forced to increase their amount of capital. That is, to guarantee for what they sell. This leads to a type of  divestment game and reverting to the core business, followed by a expansion game of this core business. In other words, mergers and acquisitions are looming over the market. And that is also bad for the stability of the sector as a whole.

Demographic trends in the West, aging being the most important one, are also forcing the financial sector to look beyond the borders of Europe for interesting markets.

And finally, climate change is an unpredictable influence on the pricing of financial services. Take for example the increasing risk of flooding now that the planet is warming up.

Developments that lead to change at companies in the financial services industry

Companies will have to return to their core, not merely with regard to their core business, but also in terms of their identity. They will have to specialize and reorganize. Key issues here are Performance and Trust. Banks and insurers should focus on:

• Simplicity and transparency;
• Relationships based on the long-term, and on trust;
• Authenticity (that is what customers want);
• Avoiding waste (in other words: a lean organization);
• Attracting and retaining talent;
• New (female) leadership

&samhoud’s results

&samhoud’s integrated approach to change results in proud professionals, satisfied customers, sustainable financial results, and social value. Organizations that &samhoud has worked for or is currently working for include Achmea, Aegon, AMB Generali (Germany), Rabobank, and Zwitserleven.