The report details how investment banks will adopt the best practices of manufacturing industries, learning from motor and aircraft manufacturers – two industries that also experience a heavy regulatory burden, regular government interference, ever evolving demand patterns, regular bouts of over-capacity and a critical requirement to pool resources in order to innovate. Banks will reinvent their operating models on three pillars:
- A fully-automated manufacturing plant for the creation, assembly and packaging of financial products and services.
- A multi-channel distribution franchise that provides a consistent user experience for all interactions between the bank and its clients.
- Data managed as an asset across the entire supply chain.
The adoption of this new operating model has significant implications:
- Investment banks’ supply and value chains will invariably extend beyond the enterprise and incorporate suppliers, partners, market infrastructure and shared utilities.
- The number of joint-ventures and strategic alliances between complementary institutions will multiply as banks focus on their core expertise, client franchises and geographies.
- As value creation will be effectively distributed across functions, the manner in which it is accounted for will also change – determining where key decisions are made and how individual contributions are rewarded.
