Deloitte Research has released a joint study with Dresdner Kleinwort Wasserstein, which draws on an extensive survey of senior management at European retail financial institutions. The report forecasts that the next five years will be particularly demanding for financial institutions seeking to reignite the growth agenda as few have the necessary grasp of detailed business economics, operations and sufficiently flexible business model. Key findings include:
New patterns of product demand: Italy, Spain and France offer strong loan growth opportunities over the next five years, driven by low levels of consumer debt and rising female participation in the workforce. Conversely, in the UK and the Netherlands savings is the key growth opportunity, in the aftermath of a long consumer boom.
Process, not product: bancassurer, distributor, monocline are all product based business models which mean little in determining the ability to sustainably generate revenues and suggest that a business has failed to appreciate the significance of process over product. Revamped finance and risk systems are essential to understand profitability at a customer, product and channel level.
The Balanced Agenda: While revenue growth correlates well with share price performance, cutting excess and prioritising spending are equally important for share price out performance. The ability to grow sustainable revenue streams by taking market share from rivals will be key.
Responsible Selling Machine: The ability to create a sales engine based on new management processes, re-aligned sales incentives and a distinct business ethos will separate the winners from the losers. Near obsessive micro management of human capital and business performance is essential. The difference will be in the detail.
Learn more from our press release, or read the entire 36-page report in the PDF file attachment below:
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