Experts available to advise on digital transformation

14th June 2017

By Pascale Gara

It is the biggest challenge to financial services providers today and one they cannot afford to ignore: how to deliver a truly omnichannel approach to customer service. 
 

They face a combination of heightened consumer expectations of consistent service across all touchpoints and the threat posed by the ‘challenger’ banks and Open Banking.

The Financial Conduct Authority’s Mortgage Market Review is also examining whether better technology can help consumers, including greater use of digital channels to deliver information and advice.

It is perhaps unsurprising, then, that digital transformation was one of the key topics at the Building Societies Annual Conference in London last month.

Delegates were told they had to target the whole customer journey with a clearly defined digital vision from start to finish, and an open and API orientated platform architecture.

It is a common call to action. In its recently published report “Who are you calling a ‘challenger’? How competition is improving customer choice and driving innovation in the UK banking market” PWC reiterated the point, saying: “To succeed, all banks must embrace new digital models…”

Digitally savvy consumers now used to conducting transactions for most things online rightly expect to be able to arrange a loan, mortgage or insurance, set up a new bank account, or manage an existing account via their mobile phone or tablet – and to be able to switch between devices. Call centres and in branch visits will increasingly be used only when the online approach does not work.

Integrating digital and physical channels into a single, seamless experience for the consumer brings many benefits. It enables analysis of customer activity to target suitable products and services, which will aid client retention and ultimately help the bottom line.

So why are so many providers still playing catch-up with digital transformation?

The sector has seen huge changes in the decade since the financial crash; from the UK’s six largest banking groups having an 89% share of the current account market to a new age with much less brand loyalty and the new breed of ‘challenger’ banks largely targeting niche services.

Many banks and building societies are having to replace legacy IT systems and restructure their business model to transfer resources from traditional bricks and mortar to online platforms, while facing greatly increased regulation and profitability pressures.

Numerous smaller FS providers with a limited budget and limited space on their boards are having difficulty finding the talent needed to guide them through the digital transformation process.

However, executive search consultancy HW has long established relationships with highly experienced digital transformation specialists from the financial services and online retail sectors who offer advisory services as consultants or non-executive directors and we can put you in touch with them.

Rob McWilliam has 25 years of experience in finance, strategy and digital leadership, with most recent positions including Vice President for Amazon UK and Finance Director at Asda Stores Ltd. He is currently building a portfolio of non-executive and advisory interests including digital advisory services across the retail and financial services sectors.

Rob said: “Digital has become an extremely broad topic, ranging from data analytics to artificial intelligence to cyber security.

“Having digital expertise in the executive team is a necessary condition for successful transformation, but it’s not always sufficient. External advisors and/or NEDs can bring real-time insight on innovation from other sectors that are, in some cases, innovating faster than financial services.

“Innovation rarely happens in a ‘light bulb moment’ but benefits from the widest possible stimulus and an open mindset, something that digital advisors can help create.

“Boards should be very clear about their most relevant digital gaps, and select digital board members or advisors who bring subject matter expertise in these fields. This might involve having multiple experts, leading some organisations to create multi-discipline advisory boards rather than appointing digital NEDs.

“If there’s only space for one advisor, the critical selection criteria should be the relevance and diversity of their network, providing access to subject matter experts across the digital spectrum.”

Mark Stevens, Managing Director (Consumer Credit Division) at Provident Financial, said the recent appointment of two digital NEDs to its Board had proved ‘invaluable’.

He said: “Being digital is not something that is simply the day job of a handful of people in IT, marketing, and operations, but needs to be part of the core skill-set of the entire organisation – now, not in the future.

“Here at Provident over the last year we have hired two new Non-Executive Directors with outstanding digital experience. Their input as we continue on our digital transformation has been invaluable, not just in terms of helping shape the strategic discussion at the main plc Board, but also supporting Executive decisions in a hands-on way through a Digital Advisory Board.”

HW is currently working with a number of clients to offer strategic advice and identify the digital expertise they need – please contact me for an informal discussion about your requirements if this is of interest to you. 

Pascale Gara is a Consultant in the Chair & NED Practice at HW. Contact her at pascaleg@hitchenorwakeford.com or +44 (0) 781 258 2486 for a confidential discussion.

 

Insatiable appetite for healthy food and convenience fuels innovation drive

8th June 2017

By Caroline Hunt

The pressure has never been greater on firms in the food sector to innovate in order to compete.

Meeting the demands of switched on consumers with an insatiable appetite for healthier food and convenience is one of the key drivers, and there is an ongoing battle to find the magic ingredients.

Online ordering and delivery services which successfully combine both, like HelloFresh and Amazon Fresh, and those connecting restaurants and couriers including UberEats and Deliveroo, are enjoying rapid growth.

Technological advances which have enabled these new entrants to the market to launch range from mobile applications to new biobased packaging materials.

Firms are also under pressure to find ways to reduce food waste and energy consumption, while coming up with new functional foods bringing additional health benefits. Technology is also at the centre of foodomics, a discipline improving both food nutrition and consumer awareness.

Competition among the grocery giants and fast food franchises in the ‘healthy choices’ market is fierce.

Last month Tesco launched its ‘Little helps to healthier living’ campaign, which is promoting healthier foods and running in store health checks, while Subway was proclaiming it was slashing 4bn calories from British diets after introducing low sugar drinks in its branches.

One of the key issues faced by global R&D organisations is the length of time it takes from conception to launch of new innovation and product initiatives, particularly in those multinationals with large complex legacy manufacturing facilities, versus more nimble financially backed competitors who can outsource through co-manufacturing and co-packaging channels.

The vital importance of nurturing innovation in the sector has not been lost on government. Last month Scotland’s food and drink industry announced the launch of Make Innovation Happen, a Scottish Enterprise funded service to support businesses to innovate.

This followed a similar move weeks earlier by the Welsh Government, Project Helix – a £21m initiative providing funding for research into global food production, trends and waste to help SMEs increase production and reduce waste.

Consumer demand for nutritious food also extends to the $70bn global pet food industry, with the rising trend of pet humanisation a major driver for growth – aided by rapidly rising online sales.

New entrants include US based The Farmer’s Dog, which is sending freshly made food directly to customers’ doors. The firm is using smart technology to create customised meal plans based on a dog’s breed, age, size and activity level, delivered within days of preparation.

The significant demand in the human and pet food industries for executives with technical innovation expertise is reflected in recent global search mandates HW has been commissioned to deliver.

This includes the VP of a global innovation centre in Germany, a VP of Technical Innovation in North America, and the head of a new Food Safety centre in Beijing.

As a truly international executive search and professional interim business, HW advises many of the world’s most recognised and respected brands, among them the leaders in consumer products and services, and retail operations of all shapes and sizes.

Our long-term relationships with senior industry leaders and key stakeholders, give us access to market-leading talent, and the opportunity to attract top quartile executive professionals.

Caroline Hunt is a Consultant in the Consumer Practice at HW Global Talent Partner. Contact her at carolineh@hitchenorwakeford.com or on +44 (0) 7584 706 763 for an informal discussion.

How to improve your chances of securing your first NED position

4th April 2017

By Pascale Gara

If you are an executive thinking about taking on your first non-executive directorship there are a number of key considerations you need to make.

First time NEDs are often surprised by the huge difference in the nature of the role. It can take time to adjust to being a non-executive as opposed to a full member of the executive team.

As an NED you need to bring an impartial, independent view to the boardroom. Your role is to scrutinise performance, constructively challenge, offer strategic input, identify new opportunities, introduce contacts, and highlight issues that executive colleagues have not.

Time management is another vital skill; NEDs can easily find themselves working far more than the two or three days per month they are typically remunerated for.

With a big push on diversity in the boardroom, there is huge demand for experienced all- rounders from a range of backgrounds who can bring industry specific expertise in key areas. Those with a background in risk/compliance and audit are particularly sought after given the increasing focus on corporate governance.

But it can be difficult to secure your first NED position with no previous experience in a non-executive role. It can help to first take on a non-remunerated role in the public sector.

You should arrange coaching/mentoring, ideally from an experienced Chair or NED with a number of non-executive roles under their belt.

Whether you are looking to move from an executive role into a portfolio career of non-executive positions or combine the two, you need to build up a range of marketable skills and develop your networks as it is likely to be a headhunter who is conducting the non-executive director search.

It is important to find the right non-executive role; it needs to be a good fit with your skill set and culture/values. You need to think carefully about the type of company whose board you want to join.

After all, you will be carrying a great deal of responsibility for the company’s financial performance, controls and risk management, as well as executive remuneration and the appointment and removal of executives.

Your own remuneration is another important consideration; it will bear no relation to executive salaries and, many would argue, to the actual responsibility held – and there will be no bonuses or share options.

NEDs looking at holding a number of non-executive directorships can find it difficult to build up portfolios because of potential conflict; for example holding positions on the boards of businesses in the same sector. They also need to take care to not change their directorships too often, or their reputation for doing this could precede them.

Phil Moorhouse, Chairman of Newcastle Building Society for the last four years, has held a number of senior board positions, is also Chair of Molins Plc and sits on the board of North Group. He was named North East Non-Executive of the Year 2015 at the North East Business Executive of the Year Awards.

Phil said: “Perhaps surprisingly after executive careers, Non-Executive Director roles can also be challenging, interesting and enjoyable. NEDs need to remember that the executives live and breathe the business on a daily basis, but NEDs can help keep focus on the bigger picture and support as well as challenge the executive to deliver strategic goals.

“Don’t rush into the first non-executive position that comes along; consider carefully and take some time to get the right one. Sector experience isn’t always necessary or desirable; identify those companies where your experience might fit with wider business issues and where you could add value.

“Personally I have found a sense of humour and enthusiasm very helpful in contributing to the all-important culture of an organisation.”

 

Pascale Gara is a Consultant in the Chair & NED Practice at HW Global Talent Partner.

Contact her at pascaleg@hitchenorwakeford.com or +44 (0) 781 258 2486 for a confidential discussion.