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Strategic thinking in design and innovation

Not Too Big to Innovate: How Design Strategies Can Transform Financial Services


Clients come to frog to discover the next breakthrough product or service that will inspire and delight their customers. Increasingly we’re hearing from banks and other financial institutions that are seeking design strategies to accelerate innovation in their organizations. Like consumer products and entertainment companies, banks want to create more dynamic and engaging user experiences based on the real needs—both emotional and practical—of their customer base. And once they define these opportunities they need to push the best ideas through the organization toward realization.  In many cases, our design strategy approach has helped accelerate the process of getting innovations to market—in ways that often surprise our clients.   

frog knows financial services. Our experience stems from working with more than 75 financial services firms over the past 5 years. Our approach is geared to helping companies target new and innovative products, services and experiences, whether the goal is looking for untapped market opportunities; validating and sizing a market opportunity; or driving user-­centric innovation practices within your organization. Moreover, our customer-centric innovation strategy helps large, established enterprises overcome organizational inertia and accelerate their business transformation. 

No matter how open a financial services firm might be to innovation, achieving this across multiple divisions on a global scale can be difficult. As a company outsider, we bring fresh thinking and a design perspective to the table. Often we work side-by-side with internal “innovation centers of excellence” or “incubation labs” that are set up by financial firms to provide more agile and creative thinking within their organization.

On a recent project with a market data and analytics firm, frog collaborated with our client’s internal innovation team to help them conceptualize and design their next generation product platform. As part of our engagement, we created tools including graphic illustrations, videos, product demonstrations, and prototypes, which were used to articulate the customer journey and highlight the key interactions through multiple channels. These materials helped our clients visualize new and engaging customer experiences and convey how these breakthrough ideas would benefit their customers at the practical and emotional levels.   

Moreover, these insights formed a common strategic vision that helped foster internal collaboration and cooperation across the organization. Instead of competing for customer mindshare, teams from different business units were able to use a common design language and a shared understanding of product and customer needs. This design direction increased communication between business units so they could align to build cross-­‚Äźdivisional solutions. Finally, these insights were adapted for presentations, including executive board meetings, where critical funding commitments and strategic priorities were set. The overwhelming support for the design strategy that frog had helped to craft, accelerated the process from product concept to customer trials.

It’s clear that innovation is needed in the financial services sector, especially with the challenging market conditions and new regulations of the post-­2008 recession era. To sustain business growth, banks must “deal with new realities in customer behavior, innovativeattackers and changing global growth patterns,” according to the 2012 McKinsey Annual Review on the Banking Industry.  Innovation is likely to occur at the margins, where typically smaller, more nimble startups are experimenting at the fringe—solving for an experience that would truly appeal to a customer’s unmet needs. Take Square and Simple Bank as examples of startups who have created potentially disruptive innovations in their respective pursuits (mobile payments and simplified online banking). They both focused on solving specific customer needs and interactions, designed engaging and intuitive experiences, created loyal followings, and continue to grow their capabilities. These firms are setting the standards for customer expectations in financial services, and highlighting the need for accelerated and agileinnovation. But innovation is not limited to new entrants. With the right approach, even large established firms can act like startups, and in most cases, they would have a tremendous advantage, given their customer base, assets, and capabilities.

Today, customers interact with their retail banks in more diverse ways than ever before—at branches, ATMs, on their mobile phones, with their tablets, and on the web. Regardless of the issue or business function being addressed—savings accounts, mortgages, mobile payments or credit card billing, among many others—customers expect a consistent, welcoming and seamlessly easy experience every time they connect with their bank. That’s why frog’s design strategy focuses on the customer and gaining a rich understanding of customer needs and behaviors. We recently helped a top US bank build a more unified customer experience across all digital and physical touchpoints and along all lines of businesses. In an emerging country, we helped a growing retail bank to design groundbreaking wealth management services toaddress a rapidly growing market segment. We collaborated with another client to develop a clear, intuitive and breakthrough user experience to drive differentiation in the rapidly changing mobile payments landscape. With all our clients, frog uses immersive research to identify and define areas of opportunity across the multiple channels and use these insights to design engaging and compelling experiences. These innovations help in addressing unmet needs, deepening customer relationships and driving revenue growth.

Design strategy might appear to be an unusual fit for financial services executives, who tend to rely on more convergent, quantifiable approaches. That’s part of our methods as well. But we go further by exploring the emotional needs of the customers and the significant trends that will affect those needs in the future. As one client executive from a Fortune 100 firm observed, “management consultancies tend to look in the rearview mirror and share best practices, but we’re working with frog because we want to be able to look forward and anticipate what’s next.

Financial services firms must innovate or be left behind as customers migrate to competitors that better serve their needs. Firms must be able to find new sources of growth, and drive innovation within their organizations that are not always designed for agility. The exciting part is that by meeting these challenges head on and embracing a design strategy approach, our clients can discover new products, services and experiences that put the customer first – and transform their business model with a bold, unified vision.

Dr. Toshiharu (Toshi) Mogi leads the Financial Services practice at frog as AVP of Innovation and Strategy. In this role, Toshi helps Financial Services firms respond tor rapidly changing business dynamics by leveraging technology-enabled innovation  to transform their strategies, products, services, and operations.