BUSINESS VISION – LEARNING FROM SUCCESSES & FAILURES (Screencast)

Business Vision: I was recently asked by a major corporation to prepare a talk on "Business vision" and how to create them. I told two stories one of Citigroup a massive bank and it's flawed vision and one about a much smaller clothing business Patagonia and it's inspirational leader. 

This screencast is a 20 minute version of the hour presentation buts gives you the key points of the stories. 

The key points illustrated by these compelling stories of success and failure around setting a business vision are: 

  • Business Vision requires leadership that listens and learns but can also lead from the front
  • Business Vision requires head and heart to be compelling
  • Business Vision needs to be creative but also pragmatic to be effective 

Here is a great article from inc.com about creating business vision that is well worth reading. 

What do you think of business vision?

What do you think about business and brand visions? Do they inspire you to feel great about the business you work in or run and it's business vision? Leave a comment!

If you want to see the full presentation including the videos then visit the presentation on Prezi.com.

You can also see me speaking here.

Want me to speak at your business or team event? I regularly speak about trust, business vision, brands, marketing or a wide range of topics tailored to your event – please get in touch.

Thanks

Justin

WHAT ARE BANKS FOR?

This article was published first in the Financial Services Forum’s Argent Magazine – Autumn 2011.


What are Banks for, if not to feather their own nests?

If we truly want to address the trust issues in financial services, I believe we need to ask some deeper, more fundamental questions about the nature of trust and what we’re here to do, individually and collectively.

 

The first step, especially following the turbulence of the past few years, is to recognise how complex an entity trust is – easy to feel but difficult to understand. The brand and industry trackers show trust going up, down and sideways – there’s little consistency. In reality, while we haven’t seen people pulling their money en mass from banks or more switching from one brand to another, it feels as if the standing of financial services brands is at a low point.

 

To understand what’s going on means recognising the distinctive layers in the concept of trust:

 

Functional trust underscores how well an industry or product group works to deliver a functional benefit. Here, banking actually continues to score highly and trust levels have actually increased – even more so since the government proved it would stand behind the banks. We all trust that a bank will work to deliver core commodity functions reliably.

 

Affective trust is where financial services companies have a real problem. Very few people have affective trust in financial services brands and virtually no-one trusts the top bankers who serve as figureheads for our industry. They’re seen as defensive and self-serving. All the TV and newspaper advertising behind the message “We’re ordinary people working for you”, doesn’t move the needle, despite what a brand tracker might say. These messages are perceived to be superficial, actually creating more mistrust and frustration with our industry.

 

It’s galling for a consumer to hear these advertising messages while also hearing a CEO defend massive bonus payments or threaten to leave the country when taxes are discussed. People integrate these messages. In our hyper-connected and hyper-transparent age, consumers assess brands and business on a range of competing dimensions to get very near the truth.

 

The trust in business, and the banking industry especially, that people used to have and that gave a legitimacy to our commercial activities has been decreasing alarmingly in the West. Business leaders are now seen as “doing the right thing” by only 20% of the population.

 

And there’s now clear evidence that commanding deep trust is a hard business issue, not a soft, intangible matter to be addressed through superficial communications alone.  It’s already directly impacting balance sheets and business models – just look at the cost of compensating for this lack of trust through vastly increased capital requirements or the ring-fencing of retail operations suggested by the Vickers report. All because we as an industry are seen not to be worthy of trust.

 

Against that background, most “normal” people are asking: What are financial services and especially our banks here to do, if it’s not just to feather their own nests? This assumption of self-serving goes to the heart of our business – and we will continue to suffer as regulators become more aggressive, spurred on by an increasingly frustrated and angry public.

 

However, those brands that truly commit to both social and commercial good, that contribute to social capital through their activities and that mobilise their workforce locally and authentically to take this message out – for them, these are the most exciting of trust-building times. Authentic, real, connected trust has always been at the heart of the profitable customer-financial services relationship. That’s why it receives so much attention, and why building it continues to be the right thing to do.

 

Read more about creating a sustainably trusted and trustworthy business and brand in Why Should Anyone Buy From YOU? (FT-Prentice Hall) by Justin Basini. It’s Available on Amazon and in all good bookshops.

THE FUTURE OF UK RETAIL BANKING?

I spent a morning last week judging the Financial Services Forum Awards for Marketing Effectiveness at the offices of Metro Bank‘s first branch in Holborn.

This ambitious new player is the first new high street bank to launch in the UK for over 100 years. It is the brainchild of Anthony Thomson and Vernon Hill. Anthony brings a huge amount of experience from a career spent in advertising and communications and Vernon founded and built Commerce Bank in the US growing to over 500 retail branches. They have the pedigree to really challenge the UK market.

Here are some snaps of the offices and branch. What was great is a real sense of the challenger brand going against the lazy ways of the incumbents. The branch is open, fun and the staff were even smiling. Vernon and Anthony were “on the floor” with Vernon’s little dog following around the office.

It all looks great  but I think the thing that will make the real difference are the ways that Metro Bank is being set up. There are many advantages that completely new businesses have especially in banking. From the infrastructure:  no legacy systems to integrate with, all data on systems that can be scaled and are cutting edge; to the way that customer service staff work both on phone banking and in branch interchangeably. It’s these advantages that will make the real difference in delivering a truly better customer experience that might just get people to switch.

And from what Anthony tells me new customer numbers are exceeding all their expectations – maybe the UK customer isn’t so inert when presented with something genuinely new, different and better.

If you enjoyed this post then why not consider signing up to the RSS or email feed – it’s free and easy to do.

Justin

Mail me: justin@basini.com
My website & the RE:Thinking Marketing & Brands blog:http://www.basini.com/
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DON’T MAKE PROMISES YOU CAN’T DELIVER

I'm a Natwest customer of long standing, around 30 years in fact, ever since I took out my first bank account. Together with their stable mate, RBS, they have launched to much fanfare of posters and advertising their "Customer Charter – 14 commitments to make them Britain's most helpful bank". I blogged about it here.  Yesterday in a comedy of errors I spent 25 minutes in a Natwest branch in London. So let's see whether my experience and those of my fellow customers matches up to their commitments:

  • We will extend our opening hours in our busiest branches: well this branch on the Strand was busy but their closing time was 4.30pm so no change there. In fact this caused one of the situations which impacted my experience – see the friendly service point below.
  • We will aim to serve the majority of our customers within 5 minutes in our branches. I love this commitment because I can hear the meeting in my head when marketing took the Charter to the retail operations guys – you can bet the result of this meeting was the insertion of "aim" and "majority" in this commitment. Well yesterday Natwest might have taken aim but I was waiting in line for 18 minutes to pay in a cheque.
  • We will provide you with friendly, helpful, service whenever you deal with us. The teller who deposited my cheque wasn't exactly brimming with the joys of summer but he wasn't that bad. However the man next to me got a shocking service. He turned up queued his 10 or so minutes and then presented the Natwest employee sitting on the other side of the glass with piles of cash. Her response, "Why are you here so late?" whilst rolling her eyes to heaven. I thought to myself why do you close at 4.30pm when every other shop on the Strand won't close until at least 6pm? This is a classic example of bank attitude: apparently the bank was doing the customer a favour by dealing with the cash. When will banks understand they work for us, especially true in the case of Natwest/RBS, rather than the other way round?
  • We will actively seek your thoughts and suggestions on how we can become more helpful. Having depositing my cheque I thought I would seek to understand the Customer Charter a little more by asking the lady at the desk about these commitments. Perhaps she would actively seek my thoughts. So I asked "What is this customer charter all about then?" Given these commitments we might have expected her to engage enthusiastically with me about the journey the bank were on to provide helpful banking. Her response "Here's a leaflet". 
Any member of the Natwest/RBS team reading this, especially those responsible for the Customer Charter initiative, is likely fuming. Their anger will come from a sense of injustice that "this is a journey" and that the advertising is as much to their employees helping to set expectations, as it is to their customers. They will  be upset that the internal communications they so lovingly created haven't been filtered down as they would have liked. They might be frustrated that the operational leadership "don't get it". But overall it won't really matter: the data will  be made to look like service is getting better, the campaign is out there, and the initiative done. The next step on careers will have been made and if the commitments don't really make a difference then most likely the key people responsible will have moved on.

Don't get me wrong, we need better banks. We desperately need retail banks to deliver on their core function which is to take deposits, lend to businesses and individuals, do this courteously, and make a fair margin. I make the point in this presentation that the case for innovation in banking at the moment is weak. Conceptually much of the Customer Charter is to be applauded. What is unforgivable is falling into the classic trap of promising before you can deliver. The customer experience reality is far from meeting these commitments; and until it is Natwest/RBS should shout a little less externally and focus internally a little more. They need to build trust and that is not done by making promises you can't deliver.

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Justin

HOT AIR OR REAL DELIVERY? THE NATWEST/RBS CUSTOMER CHARTER

This week Natwest and Royal Bank of Scotland rolled out their Customer Charter and lots of marketing in support. Full page ads in papers up and down the country. According to these adverts they are now making 14 commitments to help them become "Britain's most helpful bank". If you haven't seen the adverts (and before you click on the links in this blog) guess what these commitments are?

In the main it is the typical shopping list of customer friendly platitudes – we will be helpful, we will help you make the right choices, we are a responsible lender, we will resolve customer complaints fairly etc. Much of it is complete table-stakes – we will keep you safe online, we will provide a 24/7 telephone banking service, for example. Some of it is complete marketing spin such as "we intend" to have 600 branches open on Saturday by end of 2010 – for perspective Natwest/RBS have over 2,200 branches; and that 9 out 10 customers will rate our service as "helpful" (whatever that means).

Without being too cynical there are one or two interesting new ideas such as the community commitments which include staying open if they have "the last branch in town" (although this might create a perverse incentive for them to close down struggling branches sooner rather than later) and 25,000 financial education lessons (which again for perspective is only 0.0026 per child given there are 9.5m school children in the UK). More interesting is what has been left out.

Given that RBS/Natwest collapsed and was forcibly nationalised with taxpayers money by the UK Government in 2008 then wouldn't a commitment to financial stability and prudence have been appropriate? Given that the business failed because the money that was deposited by normal retail customers was used to build a balance sheet of around £1trn that funded risky investment banking wouldn't a commitment to managing risk more tightly been right?

And given the massive resources of this nationalised bank are the commitments to financial education really big enough? However, as I have argued on this blog before, the focus on banks at the moment should be on delivering a good, reliable service well rather than marketing and innovation (see Just How Special and Different are Financial Services Brands), in the end that is how trust will be re-established. Therefore many of the commitments are well made if they can be delivered.

So I decided to visit a few Natwest branches and talk to staff about the Charter and what it means to them. Of the three central London branches I visited none had any literature about the Charter even though all the adverts say that you can pick up a leaflet in branch. Chatting with staff I was greeted with the following comments:

"Yeah they told us about this last week, it's how they will improve the service"

"It's about serving people in 5 minutes"

and

"Dunno about that"

Searching the Twitter-verse this morning revealed an interesting series of #fail tweets from frustrated Natwest customers which might indicate that Natwest have a significant way to go on delivering their commitments.

This doesn't bode well and perhaps indicates that the timings of the marketing calendar trumped the roll out internally. This is a classic financial services marketing mistake.

Financial brands are built through experience and people. An employee that completely understands the experience they are supposed to deliver, and is supported by management and aligned incentives, is how these commitments will reach you and me. This is the really hard work of re-orienting and aligning people – this is where the focus should be rather than working with the ad agency. Without this the millions of pounds being spent on advertising this charter (and remember it is our money!) is mis-spent and will be more marketing spin that will make the lack of trust worse.

I wish Natwest/RBS luck with their commitments if they are one of the very few financial services brands and businesses that realise that the way they will win the loyalty, respect, trust and share of wallet of their customers is through creating employee advocates and excellence in actually delivering on their commitments rather than by advertising and marketing the hot air of what they intend to deliver in the future.

What do you think? Do you think this is a good initiative by Natwest and RBS? Do you trust them more given the 14 commitments? Are you a Natwest or RBS employee – what's your view of this campaign and the commitments? Any view – please leave a comment below.

If you enjoyed this post then why not consider subscribing to the blog – it's free and easy – click here

Justin

Mail me: justin@basini.com

My website and blog: http://www.basini.com/

Follow me: www.twitter.com/justinbasini

LINEAR PERSPECTIVE: MORALITY IN THE MARKETS?

In 1413 Filippo Brunelleschi discovered how to represent the three dimensional world on two dimensional pieces of paper. “Linear perspective” caused a revolution in art that suddenly allowed artists to use paint, brushes and canvasses to create valuable new imaginings that still today add value to the eyes that view them. This new perspective, quite literally, unleashed an emergent way of thinking based on human-centred naturalism that became one of the philosophical underpinnings of the renaissance.

This powerful reductionist system of representing reality through a set of rules and mathematical constructs can illuminate our current economic challenges. We are facing significant challenges today as a consequence of the free markets that have powered our economic and societal development over the past 200 years. Challenges which have never more chillingly been exemplified by the unfettered market dominance of the past 30 years with its 3 year dénouement where we were taken to the brink of financial collapse.

Through the free market system and its invisible hand, we fooled ourselves that we had discovered an infallible system which took the complex multi-dimensional world and its inter-linked human, economic and environmental consequences and by clever perspectives and maths reduced it into two dimensional form. The resulting construction of the free markets markets, a version of linear perspective, where we thought incentives were aligned to create never ending “goods”.

But unlike the great artists of the Renaissance who gave us a lasting form of value through their art we have been proved wrong. Unfortunately it turns out that the incentives embedded in the linear perspective of the markets were certainly not capable of balancing finely tuned impacts in the real world.

This I think will be the emergent conclusion drawn from the experience of the past few years. It is reflected by much of the current debate about new economic and societal models that is moving from the fringes into the mainstream.

The questioning and emergent thinking takes time to filter through the food-chain. Hearts and minds need to time to process and change behaviour. Nowhere is this truer than in big banks. Often these organisations make glaciers seem strategically nimble.

Banks in the growth-obsessed, market-driven economy are the “top predators”, despite all their protestations that they “are doing God’s work”. The banks are the masters of market driven linear perspective. They act on instinct to out-perform the incentive systems they are given. As long as the markets operate within given parameters banks make huge amounts of money because they are so good at conquering the system.

Like a lioness hunting the last zebra on the savannah, they don’t think, they just do. This is why they don’t say sorry for what the real world sees as mistakes. As a pride of lions feast on this last zebra they don’t consider the wrong or right of their actions they act on instinct within a clear incentive structure devoid of any morality or any critical thinking.

If our banks are the top predator then might it be tempting to think that, like lions and markets, banks are amoral? Drawing this conclusion would be wrong. Abdication of responsibility cannot be justified because once the PowerPoint decks and Excel analysis is put aside, all businesses are run and operated by thinking, feeling human beings. Businesses both large and small, bank or not, need to operate within in a moral framework. If they step out of this framework then we should call them out as immoral.

This has been sharply exemplified in different ways in the past week by two very different situations: the unfolding scandal at the premier investment bank Goldman Sachs and much closer to home the FSA report into complaints handling at UK banks. None of the institutions involved will ever say sorry for what any commonsense reading of the situation would be seen as mistakes. Obsessed with the incentives of the markets no bank thinks that anything they do that delivers against the market construct is wrong, irrespective of the wider real world implications.

Goldman Sachs and one particular London based Goldman banker Fabrice Tourre are currently under investigation for a series of trades that the SEC maintain the bank knew were worthless (or “shitty” as one of their bankers described the deal in an email) and therefore broke the rules of the market.

An exchange during the testimony of Mr Tourre with a US Senate Committee was particularly revealing. When asked by Republican Senator Susan Collins whether he agreed that he had “a duty to act in the best interests of Goldman’s clients”? He replied: “I believe we have a duty to serve our clients, with respect to our role as a market-maker, by showing prices to clients and offering liquidity.”

This model of duty offered by this banker is one devoid of morality: the top predator creates the market devoid of any responsibility to think critically about the consequences of their actions. The question that is asked is: Does it allow me to fulfil what I am being incentivised to do? The two dimensional world relies on the blind assumption that incentives are aligned with creating good; no critical thinking or judgment on wider impact is needed. This isn’t just Goldman Sachs and these deals, this two dimensional amoral thinking exists at every trading desk in every major bank in the world.

The next example is much more down to earth. The FSA yesterday released a report into complaints handling at UK banks. This report identifies that most UK banks have “poor standards of complaint handling”. There are many issues identified but most tellingly some of the contributing factors are cultural: senior management not caring and staff being incentivised to make the complaint go away rather than handle it to a satisfactory resolution for the customer.

Complaints and their handling are a perennial problem in banks because the linear perspective of the markets doesn’t value customer satisfaction or “going the extra mile” – it values profit and efficiency. Until banks are measured on and structured to deliver three dimensional balanced real world impacts then complaints will never be resolved properly – it just won’t be important enough in a construct that assumes never ending profit growth is always a “good” and where consumers are inert.

Markets may be amoral but their participants cannot be. As we search for a new model we need to create a more balanced, probably less efficient, set of incentives that we don’t slavishly follow but critically engage in. We need to reclaim responsibility for our individual and collective impact as businesses and brands. Then, like the Great Masters of the Renaissance, we might just be able to create “goods” which last for 500 years and still retain the power to take your breath away.

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[This first appeared in the other blog I founded: www.conservation-economy.org]

Justin
Mail me: justin@basini.com
My website: http://www.basini.com/
Read my blog: http://www.blog.basini.com/
Follow me: www.twitter.com/justinbasini

ENGAGING WITH THE WEB 2.0 CONSUMER

Yesterday I took part in the Institute of Economic Affairs Future of Consumer Finance Conference.

I gave a presentation in the afternoon about engaging with the Web 2.0 Consumer.

Here is the presentation.

If you have any views or thoughts please comment below and share the presentation if you think its useful.

Thanks

Justin

Mail me: justin@basini.com
My website: http://www.basini.com/
Read my blog: http://www.blog.basini.com/
Follow me: www.twitter.com/justinbasini

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Financial Services brands: it’s not about being different but making a difference

New blog following a debate at the Financial Services Forum this morning.

Justin Basini

Thinking about marketing, branding and advertising.
Open for chatting, collaborating and consulting.

justin@basini.com

+44 (0)7786548395

Visit my website at: http://www.basini.com

Read my blog at: http://www.blog.basini.com

Follow my Twitter feed at: http://www.twitter.com/justinbasini

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JUST HOW SPECIAL AND DIFFERENT ARE FINANCIAL SERVICES BRANDS?

This morning I took part in a lively debate organised by the Financial Services Forum and their newly formed Brand Strategy group chaired by the inestimable Lucian Camp.

I shared the floor with Tim Pile who is CEO of Cogent Elliott and has a long and distinguished career in marketing including being CEO of Sainsburys Bank and the insightful Mike Hoban who is now running marketing for DirectGov and has had successful stints at Scottish Widows and Barclaycard.

We were each asked by Lucian to describe the essence of brand building in either Packaged goods (Tim took this on), Services (excluding financial services – Mike took this one) and Financial Services (this was mine).

My key point was that I believe many of the principles of brand building are common irrespective of category because essentially we are dealing with human psychology but that the context of these principles within financial services does make it "special and different".

Three context differences in financial services:

1. Financial services companies are hard wired around product and P&L analysis rather than brand and customer.

This means that the power within financial services companies almost always resides within commercial product owners rather than marketing. These leaders are trained in P&L, balance sheet risk, regulatory compliance, operational effectiveness not marketing, brand, experience and customer.

The very logic of brand building, positioning for strategic competitive advantage, customer segmentation, product development based on consumer need are all more difficult concepts in a financial services organisation. The result is an industry that in general creates me-too products which are overly complex, often game the consumer, provide a poor overall experience and are communicated in complex jargon.

2. Financial services are delivered through people. And people are much harder to manage than a shampoo formulation.

Certainly in most product categories especially the FMCG companies, brands are entities created to effectively penetrate the customer mind and form associations with product performance rather than being a set of associations about a group of people doing something. In most cases in FMCG companies the brand you are marketing is not the brand you work for. Given most financial services organisations have one or only a few brand the internal service and brand alignment challenge in these brands is core and material to their success. From the Indian call centre agent to the CEO in a financial organisation each needs to understand the brand and how it applies to their job.

3. Financial services products tend to be more risky and complex than many other types of products or services. They require much more effort from the consumer and the provider.

An irony of financial services businesses is that the organisation often believes they are the most commoditised of products. I used to be told all the time at Capital One – credit cards are a “low involvement” business. Consumers take a product and then want us to disappear into the background.

But having spent lots of time obsessing about how to make white gloop in a bottle exciting to consumers, I don’t think that financial services products are or should be low involvement – they have a massive impact on people’s lives and well being.

If they low involvement its probably because they are difficult and complex to communicate and understand. This combines with the terrible mess we are in from a regulatory perspective, defaulting to complete, unedited exposure of all information, to make it extremely difficult for the consumer to make an informed and empowered decision.

And finally (as Lucian called it the "Basini bombshell") I ended up questioning one of the core purposes of brand building:

4. Financial services brands – it's not about being different but about making a difference

The strategic goal of marketing in many businesses is to create a differentiated position in the market that gives you competitive advantage through cheaper cost of sales or price premium for example. Of the many principles that we could consider this is perhaps one of the most fundamental.

Actually I’m not sure this has been proven effective for the main stream brands in financial services. If we look at our banks for example. A highly consolidated and inert market with very little to split apart the businesses products, performance or promise.  Certainly not enough to encourage mass switching to occur except maybe in those more liquid and more easily gamed products like credit cards.

In highly competitive and easily switched categories there is definite advantage to creating new ideas that better match and deliver against the consumer’s myriad needs. But the difference in financial services given their complex, impactful and long term nature is that aim shouldn’t be to create the new, new thing to gain share at the expense of customer loyalty but to focus on superior product reliability and partnership as a route to extracting competitive advantage and value. This is how our organisations and products can make a difference.

As marketers, we may not be in the right job to get to the CEO spot, we might be wired a little differently from the mainstream in our organisations but given our products are difficult and risky, and are built through human relationships and service, we have myriad opportunities to build great brands which have lasting value for our organisations and customers.

Lucian's blog on the session can be read here. 
 

Here is my presentation as a slidecast:

 

Thanks for reading. As always please share and comment if you've got a view.

Justin

Mail me: justin@basini.com
My website & Blog: http://www.basini.com/
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