Behind exemplary company, profits lie a set of ideas that stem from the vision of a good leader. Famous change makers have the innate ability to enter markets with original ideas, not just catering to customer needs but changing their behaviour irreversibly. A standout example is how Bajaj Finance revolutionised how customers buy consumer durables with easily accessible No Cost EMI financing. The company’s stock, which sold at about Rs.100 in 2012, now trades at roughly Rs.7,300. “Success, to me, at its simplest, is about delivering superior returns when looking through a long-term lens,” says Sanjiv Bajaj, Chairman & Managing Director of Bajaj Finserv.
Progressive leaders like him have the personal leadership vision to inspire innovation and employ approaches that transform startups and concepts into empires and revolutions. The task is more than that of simply straddling growth and sustainability. Here are 7 benchmark leadership strategies of progressive financial institutions.
- Leveraging digital levers for profitability
Progressive leaders in 2022 are putting digital initiatives first to create the foundation for an autonomous future, as per research by Gartner. The target is to streamline processes through AI, blockchain, quantum computing, and hyper-automation. In fact, Bajaj Finance took a similar approach by creating customer risk profiles based on data analytics. In doing so, it could offer loans to self-employed persons, for instance, without having to require copious amounts of paperwork, thus tapping into an underserved market.
- Investing in customer trust
Once in the market, companies tend to consider customer trust as a given. However, PwC’s Consumer Intelligence Series Survey on Trust found that though close to 90% of leaders believed that customers highly trusted their brand, the actual figure stood at a meagre 30%. New progressive leaders can build a good reputation by offering great products at pocket-friendly price tags, associating the brand with aspirational values and investing in customer support. Trust may be tough to measure, but it can’t be ignored as it is a pivotal factor in buying decisions, especially for financial entities.
- Creating ecosystems that keep customers engaged
It takes a sharp personal leadership vision to create a system where customers want to associate only with a particular brand’s products and services. Several global tech giants have achieved this. Famous change makers are giving it a digital spin, investing in fintech to create super apps where customers can do everything from chat and book tickets to buy groceries and watch movies. If successful, this idea can help a company beat a rival’s customer base.
- Rewiring customer behaviour for a new normal
The current list of progressive leaders has significantly reduced the barrier between customer aspirations and the road to get there. One can think of the ease of investing that customers now enjoy, thanks to the revolutionary ideas of certain companies. Once you get customers acquainted with a new normal, which is more efficient and relevant, they stick with you. The aim is to make incremental changes so you are always ahead of the curve in offering customers a better way to do things.
- Keeping abreast of external factors that impact services
Famous change makers see beyond the horizon and understand performance from a macro perspective. For instance, progressive leaders know that global supply chain bottlenecks bear far-reaching consequences for financial institutions. In this case, the asset quality of business clients is marred when global events throw transport and logistics into disarray. Further, inflation becomes a significant factor. Good finance institutions tweak their services to address events that strongly affect their bottom line.
- Addressing the talent crunch holistically
Talent shortage remains a top concern for new progressive leaders, and research from Gartner shows that workforce-related issues are among the top 3 priority areas that leaders cite for 2022-23. Tackling this issue demands tact and creativity. While flexibility, work culture, wages, and work-life balance remain key factors, top finance institutions are bolstering their internal talent pool by creating academies or skill-development programmes to meet the tech demands of tomorrow.
- Staying organizationally agile
Agile approaches challenge hierarchical models that can be slow-moving and weak in delivering on time. A report by McKinsey depicts agile organisations as “living organisms” rather than “machines”. Such organisations exhibit next-gen tech, quick feedback and delivery cycles and a common strategic vision. For instance, a London-based finance institution witnessed a 300% improvement in throughput after going agile, and other companies can follow suit.
With every other organisation turning into a fintech company or growing a fintech arm, it is important to win strategic battles and secure a foothold in the market. Progressive leaders often learn from one another while adapting and developing ideas to match real-world problems. Use these 7 proven tactics as intellectual play dough to fashion strategies imbued with your leadership vision.