Book review: Bank 2.0

With its voracious appetite for high-speed trading systems and oceanic volumes of data, the banking and financial services sector is often seen as something of a technological pioneer.

But according to Brett King, a strategic financial services adviser and author of Bank 2.0, the industry is in fact stuck in the technological past. Many organisations still operate from the same mainframe systems that have been in place for more than 30 years, he writes, and innovation within the sector is a slow and reluctant process.

This, he argues, has to change. Thanks to the most damaging financial crisis in decades, the reputation of the global financial services industry among consumers is at its lowest ebb. Because of this, King argues, it is now more vital than ever that banks leverage technological innovation to improve and streamline the customer experience.
King covers a lot of ground in this book, taking in a broad range of technologies that could shape the future of the banking sector.

Over the course of 14 chapters, he presents examples of how some banks are leveraging innovations such as social media, business intelligence and mobility to address specific business problems. Throughout these chapters, one theme persists. Like many organisations, banks and financial services companies suffer from a siloed approach to doing business. This inhibits the sharing of data between departments such as sales, marketing and customer service.

This, King believes, has a profound impact on the customer experience. The fact that customers must go through an arbitrary process of providing personal details every time they apply for a credit card, loan or mortgage with the same bank is, he argues, nonsensical. In the Bank 2.0 world, as King sees it, this data is shared and visualised between departments via business intelligence dashboards. This means that the necessary approval processes can be undertaken faster, and with zero form filling.

He also argues that banks have yet to adapt their organisational structures to the rise of electronic and Internet banking, despite the fact that 95% of global banking transactions are now being made electronically. For example, the head of branch banking is typically a more senior position than the head of ‘alternative’ channels – i.e. Internet and mobile phone banking – who will often sit somewhere below the IT and marketing departments regardless of how much revenue these streams draw. It is this collective reluctance to move with the times that is one of the most pressing obstacles to greater industry innovation.

King’s direct writing style is clearly aimed at business-minded financial services professionals, rather than particularly technical ones. This straightforwardness makes the book accessible, but it may disappoint readers seeking in-depth analysis of the tools and vendors in question.

At times, the author’s desire to elucidate leads him into some serious waffle. For example, when detailing the merits of VoIP and instant messaging as customer service tools, the author spends six pages recounting the respective histories of technologies such as Skype and ICQ, from the various mergers and acquisitions to their current legal status in certain territories.

This information is not completely irrelevant, but it seems at odds with the breezy nature of King’s analysis. A more ruthless editor might have helped to bring the page count down below its rather excessive 400 pages.

King’s overall argument is that the credit crunch and ensuing recession have intensified the need for innovation in the financial services sector. This innovation is required not only to maximise the value that can be derived from customers, he says, but also to regain their trust.

He acknowledges, though, that even after the disastrous events of 2008, not every banking organisation is ready to change. “Let us be clear,” King writes in the preface to Bank 2.0. “This book is not for traditional bankers who want to stick to the status quo.”

Bank 2.0
By Brett King. Published by Marshall Cavendish.
ISBN: 978-981-4302-07-4. Price: £19.99

Peter Done

Peter Done is managing director of Peninsula Business Services, the personnel and employment law consultancy he set up having already built a successful betting shop business.

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