The Second Wave Of Business Innovation

At the weekend, when picking up a delicious, still-warm loaf of bread and a box of edible goodies from our local farm shop. I thought about how our day-to-day lives have been altered by the COVID-19 experience, and how those who service our day-to-day needs have responded, thrived or failed. When lockdown was imposed in March, and shopping went online, we worried what might happen to our much-loved local farm shop. And on a wider scale, what would the crisis mean for any service provider?

Lessons from a farm

In this case, we didn’t need to worry. Rather than spending weeks getting up to speed on a digital platform builder – vital time that could have cost them their business – they quickly adapted using the tools they had available. They set up an email order form, collected payment by phone when produce was ready for collection and brought orders out to a collections table to minimise contact.

It all sounds rather manual. But even as lockdown restrictions have eased, customers – and the business owners – still prefer the new service. And as a model, it’s more efficient and delivers a higher quality, personalised service. The farm shop can plan its inventory, there are no queues, and people can buy with confidence.

But while our farm shop is one of the success stories, it led me to think about what drives change, at what pace, and how the fintech industry can adapt.

Moving from compulsion to awareness

Service innovation has taken dramatic leaps in our everyday lives, driven by two main factors. The first is compulsion or instinct – the need to adapt to survive. But the second is driven by a new state: that of awareness. We’ve realised that in adapting, we no longer need to consider the previous constraints we under which we operated – or lived by – as sacrosanct.

The compulsion phase drives immediate action: we do what we need to do to survive. Of course, we can always innovate further, refine, improve and perfect. More than six months since the first lockdowns, businesses couldn’t or didn’t act quickly will be struggling, if indeed they have survived at all. For some businesses, the actions they took initially will be enough, just as with our farm shop. In some cases, these changes will be temporary, giving time to reflect on a new model for the future.

The awareness phase happens at a slower pace since it requires reflection on how the environment or behaviour may have changed and the implications for the future. We are already seeing rapidly shifting business models that push boundaries that we previously saw as limits on what could be achieved. This is the challenge for fintechs today: to push past perceived boundaries to position services that allow them to thrive post-COVID.

Driving success through greater awareness

We’re already seeing change as we move into the critical awareness phase. For example, one of the most important findings in the latest FIS Readiness research is the increased interest in managed services and cloud as companies recognise the risks of managing technology in-house, particularly in constrained working conditions. At the same time, firms are also seeking to achieve top-line growth, whether by targeting new client segments or geographies, expanding environmental, social and governance (ESG) initiatives or driving innovation in products and services.

But we’re still at the beginning of this phase. Some of the ways that I see businesses rethinking and adapting include:

1.      Be bold in thinking about the extent of services you could offer. If you don’t, others will (or already have).

2.      Lack of action will leave you behind. Test, launch and learn, and then either pursue all in or fail quickly.

3.      Don’t automatically reject things which have previously been tried and failed. It’s a new world and past behaviours may not be as relevant.

4.      Keep an eye on business models outside your own industry. What works in other industries helps to indicate how people and businesses are thinking, and what demands they have.

A wealth of ideas is fomenting in your team. Find ways of exposing these in a way that is inclusive, supportive, and demonstrates that people’s contribution is valued.