9 October 2004 — As the banking industry increasingly consolidates, small and medium size banks face tougher challenges in differentiating themselves and surviving. Speaking at the Business Leadership Forum in Paris on Friday, Juan Arena, chairman and CEO of BANKINTER, told what he called, “the story of a bank which can survive in this world by being different through innovation, transformation and change.”
Arena told more than 200 industry leaders and members of academia there were three major factors that led to success for BANKINTER:
Investing in integrated system. “Integration is crucial in banks because the more technology allows you to deliver service to your customer, the more you need an integrated system to deliver quality,” he said.
Blending systems with culture. “Technology is not something that is outside anymore, something that only the people who know about IT know how to speak. Technology in our case is the flesh and blood of the company.”
Customer focus. “We invest not just to sell them better but to know them better,” he said, noting the expense banks incur to support non-active customers.
“We were not strong, we were not big and we needed to innovate to grow. It was the only way we could grow,” he said. “And every time we innovated, we were able to grasp a market share which was much bigger than the one that we deserved according to our size.”
Also speaking at the forum was Juergen Dormann, chairman, president and CEO of ABB, a global company that provides power and automation technologies for utility and industry customers.
In 2002, the company faced a multitude of problems including a liquidity crisis, lack of strategic focus and litigation over asbestos issues.
“ABB had in a few years gone from a model case study to a near basket case,” said Dormann. He described how the company effected a complete turnaround by cutting costs, selling extraneous assets and refocusing both internally and externally.
“We will go from being a factory driven manufacturing company to a market driven manufacturing company,” he said.
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