# The new CEOs?
Author:  Pal Sinha, Barnali 
Author URL: https://financedigest.com/author/pal-sinha-barnali
Published: 2016-06-01
Category: BANKING
Category URL: https://financedigest.com/category/banking
Meta Title: The Power Shift in Finance: Are Big Banks Asleep During the
Meta Description: Explore the shift happening in the world of finance as digital challenger banks disrupt the traditional players. Is customer-centrism the new norm?
URL: https://financedigest.com/the-new-ceoshtml

![undefined](https://prod.superblogcdn.com/site_cuid_cm5qst7v3003gwirgwqtxn8i8/images/a0031285-771-1736844731347-compressed.jpg)

**Marina Cheal,** CMO at Reevoo

The power shift that’s catching the big banks off guard

In almost every industry, businesses are adapting to revolve completely around their customers, with digital transformation as the catalyst.

However, the big players in the finance industry have been slow to react, and a new guard of digital [challenger banks](https://www.financedigest.com/the-rise-of-challenger-banks.html "challenger banks") are picking up the slack by building themselves around their customers.

The [face of business leadership is changing](https://www.financedigest.com/the-changing-face-of-financial-advice.html "The changing face of financial advice "). Not necessarily in terms of corporate hierarchical structure, but in terms of who the true leaders and decision-makers are. Corporations in the past were led from the top-down, motivated into [action by dynamic and effective CEOs](https://www.financedigest.com/new-uk-pm-will-need-to-take-urgent-action-on-energy-bills-ofgem-ceo.html "New UK PM will need to take urgent action on energy bills – Ofgem CEO") who represented the brand and what it was about. But today’s brands – at least, in most industries – are seemingly more humble; more willing to listen to the wants and needs of customers and adapt to them. Are the [big banks](https://www.financedigest.com/big-bank-ceos-to-sell-lawmakers-on-relief-diversity-efforts-amid-economic-regulatory-challenges.html "Big bank CEOs to sell lawmakers on relief, diversity efforts amid economic, regulatory challenges") asleep during the revolution?

The trust barometer shifts again

Let’s [talk about the shift occurring in business](https://www.financedigest.com/bhp-in-talks-to-sell-global-oil-gas-business-to-australias-woodside.html "BHP in talks to sell global oil, gas business to Australia’s Woodside") values. The most valuable commodity in business today is trust. It shapes the way customers regard companies, what they value, and – most importantly – what they buy. So how can companies leverage this to their benefit?

As the [2016 Edelman Trust Barometer](http://www.edelman.com/insights/intellectual-property/2016-edelman-trust-barometer/global-results/) shows, consumer trust in companies in 2015 was quite bottom-heavy. Despite the credibility of CEOs increasing this year, respondents rated the employees of a company +7% higher, and their peers a [full +16% higher](https://www.financedigest.com/flutters-full-year-earnings-turnaround-forecast-sends-shares-higher.html "Flutter’s full-year earnings turnaround forecast sends shares higher") than a CEO. Trust isn’t suits anymore – it’s grassroots. Customers trust themselves and each other more than CEOs.

So what can companies do? Well, they can make their customers the CEOs, so to speak.

Customers in the driver’s seat

In an effort to demonstrate that important customer-centrism, the financial [services industry](https://www.financedigest.com/financial-services-industry-blazes-the-trail-for-cloud-migration-post-pandemic.html "Financial services industry blazes the trail for cloud migration post-pandemic") must come to three conclusions:

I need to be where my customers are. That will require some digitisation. Banks are halfway there, but their legacy [systems are holding](https://www.financedigest.com/energy-utilities-sector-to-hold-60-share-in-switchgear-monitoring-system-market-by-2031.html "Energy & Utilities Sector To Hold 60% Share In Switchgear Monitoring System Market By 2031") them back in a huge way.

I need to prioritise my customer’s needs. This will require a customer-first approach in all aspects of the [business and a completely open](https://www.financedigest.com/neoma-business-school-opens-the-first-virtual-campus-in-europe.html "NEOMA Business School opens the first virtual campus in Europe") attitude to customer feedback.

I need to communicate in a way my customers understand and trust. That will require embracing the consumer voice and letting it speak for the brand.

The Internet has been the greatest democratising, enfranchising communication tool since the printing press.

It’s been similarly revolutionary in our economic advancement as well. Commerce now happens instantly, digitally, anywhere around the world. This has led to companies not only altering their [digital presences in response to way people shop](https://www.financedigest.com/youtube-expands-shopping-features-to-combat-digital-ad-slowdown.html "YouTube expands shopping features to combat digital ad slowdown") (through ecommerce advancements), but also the way they communicate (through user-generated content).

Brands can now use their digital storefront to curate and exhibit the finest content customers have created about their products, and indeed, as customer-centrism grows, so does the [real estate](https://www.financedigest.com/how-to-buy-income-producing-real-estate-without-your-own-money-or-credit.html "How to Buy Income-Producing Real Estate Without Your Own Money or Credit") given to UGC. By placing the focus squarely on how the brand interacts with its customers (and vice versa), companies can acknowledge and demonstrate (quite accurately) that customers are truly the new CEOs.

Tom Blomfield, CEO of FinTech start-up [Mondo](getmondo.co.uk), spoke with the [People Tell Richard Stuff podcast](https://itunes.apple.com/gb/podcast/people-tell-richard-stuff/id1056107453?mt=2&ls=1) about how his company’s use of technology differs to the big banks.

_“Every industry thinks they’re immune to the internet, and to the [rise of technology](https://www.financedigest.com/specialty-printing-consumables-market-rising-adoption-of-advanced-technologies-to-bolster-markets-growth-prospects.html "Specialty Printing Consumables Market – Rising Adoption of Advanced Technologies to Bolster Market’s Growth Prospects"). You [see them slowly grow until they fall](https://www.financedigest.com/uk-retailers-report-record-food-inflation-but-see-falls-ahead.html "UK retailers report record food inflation but see falls ahead") off a cliff. Banks in the UK aren’t even close to falling off a cliff yet, so their biggest concern is not challengers… priority one is regulatory change, and priority number two is digitisation as a mechanism for cost-cutting. Responding to the threat of consumer-focused, product-focused challenger banks is a very long way down the list.”_

This influence customers and employees – the “peers” on both sides of the coin – are wielding over corporate executives is real, and powerful. There is an ongoing upswell of [sentiment that CEOs have lost sight of the large populations their products service](https://www.financedigest.com/euro-zone-services-booming-but-sentiment-recovery-may-have-stalled-ecbs-lane.html "Euro zone services booming but sentiment recovery may have stalled -ECB’s Lane"), and the populations are letting them hear about it.

Over two-thirds of respondents report that they feel CEOs focus too much on short-term financial success, while well over half say that CEOs don’t spend enough focus on having a [positive long-term](https://www.financedigest.com/automotive-glass-market-to-witness-sales-slump-in-near-term-due-to-covid-19-long-term-outlook-remains-positive.html "Automotive Glass Market to Witness Sales Slump in Near Term Due to COVID-19; Long-term Outlook Remains Positive") impact. This isn’t just talk, either; customers are [prepared to award companies and CEOs](https://www.financedigest.com/exclusive-naftogaz-ceo-prepared-to-step-down-if-it-would-facilitate-debt-deal.html "Exclusive-Naftogaz CEO prepared to step down if it would facilitate debt deal") who do.

Blomfield [says his company’s](https://www.financedigest.com/french-unions-unanimously-sign-wage-agreement-with-edf-company-says.html "French unions unanimously sign wage agreement with EDF, company says") attitude to an open dialogue with customers is key.

_“Customer feedback is central everything we do. Every single member of the team does customer support. I was doing it this morning for an hour._

_“When we launched the app, the biggest button was ‘feedback’. Chat with us, tell us what’s wrong.”_

Listen to your customers, but clearly communicate the fact that you are listening. By prominently featuring and championing feedback and user-generated content, as well as putting customer concerns at the forefront of policy, those customers will know that in your company, they are the CEOs, and they are the boss. And that’s a wonderful thing.

Let others speak for you

When it does come time to advocate for your brand, the chart at the top of this article suggests that the megaphone shouldn’t just belong to those in the boardroom. The average employee is more credible in regards to their company than the [CEO](https://www.financedigest.com/elon-musk-who-runs-four-other-companies-will-now-be-twitter-ceo.html "Elon Musk, who runs four other companies, will now be Twitter CEO") of said company. Technical experts are still the most trusted, but in the past year alone, peer-to-peer credibility has leapt an impressive +6%, so that now nearly two-thirds of respondents consider spokespersons of their peers to be “extremely/very credible.”

The more a brand and its executives are able to step out of the spotlight, the more credible that brand’s claims will seem.

Bye bye banks?

Even though the big [banks are lagging](https://www.financedigest.com/analysis-banks-lag-bond-yield-surge-as-recession-worries-trump-cheap-valuations.html "Analysis-Banks lag bond yield surge as recession worries trump cheap valuations"), do the challengers have enough power to deliver a fatal blow? And do they even want to?

_“I don’t think the banks are going anywhere soon. The FinTech companies don’t have to ‘win’ for the banks to ‘lose’,”_ said James Haycock, MD of digital transformation agency Adaptive Labs and author of [‘Bye Bye Banks’](https://www.adaptivelab.com/byebyebanks/) on the [People Tell Richard Stuff podcast](https://itunes.apple.com/gb/podcast/people-tell-richard-stuff/id1056107453?mt=2&ls=1).

_“They’re understandably regulated in a particular way, which is a good thing for consumers. What that means is that delivery of [change is very important](https://www.financedigest.com/popcorn-containers-market-important-changes-in-industry-dynamics-during-2017-2027.html "Popcorn Containers Market  Important Changes in Industry Dynamics during 2017-2027") – but regulatory change is prioritised above everything else.”_

Blomfield agreed that [startups like his don’t need the high street banks](https://www.financedigest.com/the-latest-on-choosing-banks-and-registered-agents-for-startups.html "The Latest on Choosing Banks and Registered Agents for Startups") to completely disappear.

_“No, we absolutely don’t.  We’re still [fractions of a per cent of the market](https://www.financedigest.com/the-butter-fat-fraction-market-to-grow-beyond-the-odds-of-mediocrity.html "The Butter Fat Fraction Market To Grow Beyond The Odds Of Mediocrity"), and even if we get to 1 or 2 per cent of the market, that’s a really big customer base already._

_“In the longer term, I think retail bank banks will look dramatically different in 5 or 6 years. We don’t need one or any banks to [fail for us to be successful](https://www.financedigest.com/why-start-ups-fail-5-barriers-to-business-success-and-how-to-overcome-them.html "Why start-ups fail: 5 barriers to business success and how to overcome them"). I mean, I think they might.”_

_“Every [industry thinks they’re immune to the internet](https://www.financedigest.com/embedded-security-for-internet-of-things-market-2021-by-global-key-players-types-applications-countries-industry-size-and-forecast-to-2027.html "Embedded Security For Internet Of Things Market 2021 by Global Key Players, Types, Applications, Countries, Industry Size and Forecast to 2027"), and to the rise of technology. You see them slowly grow until they fall off a cliff. Banks in the UK aren’t even close to falling off a cliff yet, so their biggest concern is not challengers… priority one is regulatory change, and priority number two is digitisation as a mechanism for cost-cutting. Responding to the threat of consumer-focused, product-focused challenger banks is a very long way down the list.”_


---
This blog is powered by Superblog. Visit https://superblog.ai to know more.
---