Bluerating | June 2020
Before the pandemic, banks and insurance companies would compete to see who could build the highest skyscraper or host thousands of employees.
The richer the family, the higher the tower, just as in the Middle Ages. Suffice it to think of Torri della Grisenda and Torre degli Asinelli in Bologna or Torre del Mangia in Siena, to cite but a few. Height becomes a synonym of power, of proximity to the sky and to God, some of the oldest desires of mankind.
Then came the pandemic: banks kept working throughout the lockdown, even with about 3% of their employees working in person at their headquarters.
All went well, in some cases even better than when offices were full of employees, when people queued at the coffee machine, in the cafeteria, went out for a smoke or a breather.
And of course, everything worked because the rest of the employees (97%) could, or better, had to work from home.
Two questions arise: 1) Will everything go back to normal? 2) Can we really speak of smart working?
The return to normality depends on the epidemic curve and the vaccine; at the same time, it is clear that the current situation has made an endless series of prejudices crumble.
The new habits acquired during the lockdown have several pros: financial advisors, for example, were able to optimize time (34%) and costs (24%); to take advantage of technologic tools which were little used before the pandemic (29%); to share documents more easily (21%); to increase the likelihood of reaching their goals (17%).
The cons concern mainly technical issues (58%); the lack of human contact (55%); the poor digital culture of clients (39%); the issues of protection and privacy (35%) (Source: FINER Lockdown Monitor; sample: 300 FAs; collection of data: April 2020).
There is no doubt that the emergency triggered an irreversible process which will eventually urge even the most digitalized banks and financial networks to move towards the optimization of long-distance procedures; less digitalized banks and networks will be forced to follow to avoid being swept off by the market.
As for the second question, everyone refers to the way we are currently working as smart working; and yet, is this really smart working?
The Observatory of Politecnico di Milano defines smart working as “a new management philosophy founded on a return to people being given flexibility and autonomy in choosing their spaces, their working times and the tools they use, against the backdrop of taking more responsibility for the outcome”.
Therefore, smart working should be limited to set amounts of time in order to avoid the estrangement company-employee and social isolation; instead, social isolation is currently the very reason of smart working.
Perhaps what we are living today might be better defined as working “under house arrest”, a result of the medical emergency entailing an unclear pace of work established outside of a shared and conventionalized time-space framework.
However, the pandemic, the lockdown and what has followed have been dismantling a set of rooted conventions and habits. Where generations of CEOs, CFOs and IT managers failed over the years, the emergency succeeded in less than two months.
This is going to affect both future business models and, most likely, the characteristics of banks – they will either win or lose the challenge.
To say it with a metaphor, while size matters and a large vessel stands big waves better than a ferry, it is the quality of the ship that allows to stay afloat and not to take on water; equally important is the ability to avoid obstacles and hidden dangers.
Very often size is inversely proportional to agility – today, more than ever before, the ability to adapt and to be resilient have become critical success factors. We are going to witness great changes in the industry of banks, financial networks and asset management.