TSB and the new world order

As TSB prepares to be taken over by Banco Sabadell, their focus on physical branches is a notable move. In the face of increasing tendencies toward digital services, the purchase of 30 new outlets to add to a network of 265 flies in the face of many other high street banks’ strategies.

History

TSB has had a chequered history. Having been absorbed into the Lloyd’s network in 1995, it was wiped from the high street in an era when digital banking was just a pipe dream. 20 years later, with a government bail-out and a return to profit under the Lloyds TSB banner in 2013, it has been sold to Spain’s Banco Sabadell at a loss to Lloyd’s of over £660m.

The old model

The focus on physical branches may indicate a decision to remain a “local bank” in the old model, when one knew one’s bank manager and perhaps experienced a more personal service. Regulation, trends towards customer service efficiency and changing public attitudes to banks have altered retail customers’ requirements, but in the UK at least TSB are not alone in focussing on “Local Banking on Demand”, as Peter Navin, Managing Director for Branch and Business Banking, says. NatWest have also spend significant resources focussing on their expanded opening hours and abolition of ‘new customer only’ offers, in an attempt to improve loyalty and attract new business from retail customers who find traditional ‘banking hours’ and policies impossible to work with.

Disruption

The retail banking space in the UK has been disrupted by the Metrobank model in recent years – whose approach includes seven day opening and simple account opening services. They are also pet-friendly.

The assessment of what a high street customer wants from their bank has been the focus of much discussion in the post-GFC world. Scandals, reputational disgrace and bail-outs have required banks to abandon the stalwart and haughty attitude they had in the ‘golden era’ of high street banking between the 1970s and 1990s.

TSB may appear bold, but it’s hedging its bets. In addition to the expansion of physical branches, they are doubling their digital team, and claim to be the “first UK bank to appoint a chief digital officer to the executive team” according to Finextra.

What customers want

If TSB can meet customer needs in physical branches, there is much to be gained for their new owners. The latest World Retail Banking Report from Capgemini and Efma lists several negative trends for retail banks:

  • Globally, likelihood of changing primary bank is increasing.
    • Customers are less likely to make a referral.
  • Digital service alternatives are not satisfying customers.
  • Innovative and disruptive players including Apple and Google are piquing customer interest.
  • Complex integrations to create personalised service are increasingly straining legacy security systems and processes leading to low levels of satisfaction from customers.

If the “bricks and clicks” model is to be successful for TSB, we recommend they use the plethora of fintech platforms and opportunities rather than relying on Sabadell’s existing suite of platforms and services. Perhaps this way, they can become a truly modern bank.

Carl Sagan: users of the universe

Professor Carl Sagan was a visionary. In his seminal TV series and accompanying book Cosmos, he sought to teach the general public not only about cosmology and more general science, but about the impact we are having on Earth. His ability to take an atemporal perspective on the impact of humanity on the planet was way ahead of its time in late 1970s, and still has it detractors 40 years later, but is essentially one of user experience. He warns us of the huge damage our desire to ‘improve’ our user experience of the planet will have for hundreds of thousands of years after we (as a race, let alone individuals) are gone. He reminds us of our insignificance in the history of Earth, and hopes to teach us to consider more than our own satisfaction in the way we live our lives.

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IBM combine artisan skills with heritage to create innovation campaign

In a series of paper art posters, mixing a traditional medium with the promise of innovation, computing giant IBM promotes their work. The combination of environmental concerns and technological innovation in the messaging is part of the ‘Smarter Planet’ drive at IBM, which has been working for six years to improve efficiencies and reduce wastage in key sectors identified by IBM.

It’s so interesting to see major corporations like IBM putting so much emphasis on being ‘smarter’. Requalifying themselves as innovators is a tough challenge for a mature organisation, and this incubation programme gets the pitch right whilst not detracting from the core capabilities of the company. We like.

cannes posters_DEEP DIVES_color version cannes posters_DEEP DIVES_color version

Derisking trading

Risk has become a topic for constant discussion and assessment in investment banking. In an environment where instant messaging, process automation software and recording voice instructions increasingly via direct instruction from investors are just some of the methods by which orders are placed, good user experience design presents an opportunity to reduce risk for fund managers, traders, institutions, intermediaries and the end investor.

Creating an intuitive, usable and pleasing product using cognitive science and design thinking reduces the risk of errors made by end users, high training costs, user frustration and potential project failure, not even taking into consideration the business risk associated with the changing systems.

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Upcoming event: Round Table with UI Tech Mess

Ofer Deshe will be taking your questions at the UI Tech Mess event on 26 March, at The Dome Room, 1 Cornhill.

The Realization Group and Adaptive Consulting would like to invite you to an after work roundtable discussing ‘The UI Tech Mess’ on 26th March. The purpose of this event is to get like-minded people in a room to share experiences and discuss the current state of front-end user interface (UI) technology in trading platforms and how firms can future-proof their investment in UI development. The discussion will be hosted by Mike O’Hara of The Realization Group, featuring:

John Marks – Adaptive Consulting
Ash Gawthorp – The Test People
Eddie McDaid – Software AG
Ofer Deshe – Tobias & Tobias

To reserve a ticket, please go to UI Tech Mess