Changes

English: The Red-eyed Tree Frog (Litoria chlor...

English: The Red-eyed Tree Frog (Litoria chloris) found in eastern Australia. Français : Litoria chloris, une grenouille arboricole de l’est australien. (Photo credit: Wikipedia)

So the story goes, if you throw a frog into a pan of boiling water, the frog immediately realises the danger and jumps out. If, however, you put the frog in a pan of tepid water and apply heat to the pan until the water boils, the frog stays put and slowly cooks and dies. I’m not a chef or a reptologist and I certainly haven’t performed this experiment to check the results, but it’s a good analogy for resistance to change.

In some ways, the human psyche is hard-wired against change. The brain works on success strategies, and once it finds one that succeeds in a given situation, then that becomes the brain’s go to guy when those events arise. It’s a very successful method. We don’t need to touch a flame more than once to realise it’s going to hurt and we soon gain a healthy respect for heights after a few falls.

When it comes to our working lives, it works the same way. We work out how to speak to people to get results (although I think this particular skill peaks at the age of 4). We work out the best way to word an email, apply for a job and ask for a pay rise. It’s not usually particularly scientific. We rely on trial and error, but once we work out a winning formula, the brain locks in that strategy.

One of the worst things about the brain is that it is a creature of habit. Once it has picked up a way of behaving, it is highly reluctant to change. After all, if something’s worked loads of times before, why wouldn’t you trust it to work again?

This would all be great if nothing changed. Unfortunately, everything does.

People change. Not only do people join and leave organisations all the time, but even the people who don’t learn new skills or go through new experiences that change their outlook on life. Technology changes all the time. In a living breathing organisation, processes change. In society, expectations of what’s OK and what’s unacceptable change. Our perspective changes every time we learn more about everything around us. When you think about it, there is very little that doesn’t change, so the circumstances in which we learned our success strategies gradually are unlikely to be repeated.

It makes sense to ask yourself occasionally whether you feel like a boiling frog. Have you changed enough to cope with all that’s changed around you?

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Innovation and Insight in Financial Services

English: Broadway show billboards at the corne...

English: Broadway show billboards at the corner of 7th Avenue and West 47th Street in Times Square in New York City (Photo credit: Wikipedia)

There’s something about New York. The place exudes a sense of purpose. Broadway is the perfect place for a show and it seemed a fitting location for the Celent Innovation & Insight event. The theme of the show was shoot for the moon and even if you fail, you’ll fall among the stars so it seemed fitting that it started with the Star Trek theme tune. Representatives from various companies shared their stories of innovation in both insurance & banking.

The keynote speaker was Richard King, the founder and CEO of Ingenie. Young car drivers pay extortionate rates for car insurance and Ingenie seeks to soften the blow through an innovative combination of telematics (a “black box”) and social media. Backed by some very famous names, the company is just over 2 years old. Gary Lineker, the former England footballer, is Richard’s next door neighbour and he joined by chance when he came round for a cup of tea. Frank Williams of Formula One fame is another backer sharing an interest in telematics technology.

20% of young drivers crash in their first year. 95% of those crashes are down to behaviour. Ingenie works by monitoring driving behaviour and looking for things like sharp braking and fast cornering. Using gamification techniques, good drivers are rewarded and bad drivers are penalised with higher premiums. Should the system detect a potential “license losing event” – the driver gets a black message followed by a call from the firm’s trained psychologists. Half the drivers cancel their policy in response. The other half pull their socks up and behave themselves. For normal insurers the end up losing money on young drivers. Ingenie’s underwriters make money and drivers get reduced premiums. Every one’s a winner.

Their data gives them an interesting insight into the rate of claims. If mum or dad are on the same policy, the chance of a claim is reduced by 13%. If mum or dad engage with monitoring the driver’s behaviour, the chance of a claim is reduced by 25%.

Good old-fashioned paper cheques seems an unlikely spawning ground for innovation. The only reason I still have a cheque book is because the window cleaner won’t accept any other kind of payment! Remote deposit capture using a camera phone has been around in the states for some time. USAA took this a step further and used a combination of video and augmented reality to push the first time success rate up from 78% to 92%. They also had a “Siri for Banking”, only there’s had been christened as Nina. The voice recognition understands roughly 200 questions such as “Tell me how much money I spent last weekend” and “Show me all transactions over $1,000 in the last 30 days”. They hope to make the software more intelligent over time so that they can answer things like “Can I afford a house in this area”.

Bankgirot, a Swedish bank, demonstrated a system that did real-time mobile payments including settlement and clearing in just 2 seconds. UBS talked about an innovative 2 factor authentication system using a combination of NFC and chip and pin.

I thought it was my lack of knowledge about trade finance and cash management that rendered those stories mundane, but as that was the only session where the audience had no questions, I was not alone. Some things are hard to make exciting.

Metlife engineered something called “The wall” which essentially brought data from all their disparate back-end systems into one place modelled on Facebook’s wall. Now in use in all their call centers, the software allows operators to quickly access all the details of their customers and the relationships between them.

A Temenos customer, Commercial Bank of Africa, won a highly commended model bank award and model bank of the year for their M-Shwari solution. Using a combination of the T24 core and M-Pesa for mobile payments with the Integration Framework pulling it all together, they brought banking products to huge unbanked population in Kenya. I collected the awards on behalf of the bank. Unfortunately, one of them could have passed for a deadly weapon which meant necessitated some rather crafty packing on the way home.