Vol 3 #6
Empowering Innovation in Core Banking: Transitioning from ‘Innovators in the Basement’ to a dynamic ‘Flexible Office’ setup that promotes visibility, collaboration, and respect across all teams.
In the fast-paced world of core banking, balancing the demands of daily operations, ongoing transformations, and future innovations can be challenging. It’s a delicate dance that requires each team to have a specific role while working toward a unified goal. Yet too often, innovation—the lifeblood of future growth—ends up in the proverbial basement, sidelined and neglected. In our cartoon “Innovators in the Basement,” we see a well-equipped team with bright ideas but no resources or time to bring them to life, all tucked away from the core operations of the bank.
Compare this with the scene in “The Flexible Office”, where the Run, Change, and Innovate teams have dedicated spaces that respect each function’s unique needs. The result? A dynamic environment where each team can thrive, engage with one another, and contribute meaningfully to the bank’s success. Let’s explore how a neglected innovation team can transform into a fully integrated force when given the right resources, space, and respect.
Innovators in the Basement: When Innovation is an Afterthought
In “Innovators in the Basement”, the innovation team is stuck—both literally and figuratively. Despite having great ideas, they lack the necessary time, attention, and resources to move forward. This basement scenario resonates with many banks, where innovation is often seen as an afterthought. While the operational and transformation teams are front and center, ensuring that day-to-day functions and core changes are running smoothly, the innovation team is isolated, struggling to gain visibility and support.
Why Do Innovation Teams End Up in the Basement?
- Focus on Immediate Needs: Banking is an industry that runs on stability. Keeping the system running and managing daily demands often take priority over exploring uncharted territories.
- Resource Allocation Challenges: With budgets frequently directed toward operational and transformation needs, innovation can be seen as an “extra” rather than a priority.
- Siloed Thinking: When innovation is relegated to a separate corner—like our “basement” team—it becomes disconnected from the bank’s immediate goals and struggles to gain traction.
Having been in meetings where innovative projects are pushed to the side in favor of pressing operational needs, I know the frustration firsthand. But the reality is, if we don’t invest in innovation now, we’re only stalling progress that will need to happen eventually. Innovation shouldn’t be a separate item on the agenda; it should be woven into the bank’s daily operations.
The Flexible Office: Where Every Team’s Focus is Respected
Now, picture “The Flexible Office”, where the layout itself is a testament to the bank’s strategic alignment. Each team—Run, Change, and Innovate—has a designated space tailored to their needs. The operations team has a practical, efficient setup for day-to-day tasks, the transformation team has a project-oriented space for strategy and execution, and the innovation team is situated in a creative area that fosters forward-thinking. Importantly, these teams aren’t isolated. They’re positioned to easily connect, communicate, and collaborate, fostering a culture where every function respects and supports the other.
How Integrated Spaces Empower Each Team
- Dedicated Zones for Unique Needs: Each team’s area reflects its core responsibilities, allowing them to focus without interruptions while still staying connected.
- Seamless Collaboration: With designated spaces in proximity, teams can interact easily, allowing ideas to flow freely and fostering a more cohesive strategy.
- Visibility of Contributions: When every team is visibly part of the bank’s workspace, their efforts are acknowledged and respected, enhancing morale and engagement.
When I see a setup like this, I’m reminded of the powerful effect of simply giving each team a space that honors their work. It’s amazing how just moving a team from a metaphorical basement into the open floor can shift how they’re perceived, both by others and themselves. Respect for each team’s role is the foundation of an integrated approach to banking.
From Basement to Boardroom: Steps to Integrate Innovation into Core Operations
Moving from a setup where innovation is isolated to one where it’s actively integrated requires deliberate action. Here are practical steps for creating an environment that respects every team’s unique focus:
1. Allocate Resources Equitably
For innovation to thrive, it needs dedicated resources, just like operations and transformation. Ensure that budgets account for the needs of each function and treat innovation as essential, not as a luxury.
- Example: When planning the budget, allocate a fixed percentage for innovation projects, enabling the team to pursue new ideas without constantly battling for resources.
2. Create a Collaborative Workspace
Physical proximity matters. Arrange the workspace so that the Run, Change, and Innovate teams are close enough to facilitate collaboration but also have areas where they can focus independently.
- Example: Set up an open area between departments with seating, whiteboards, and shared digital tools that encourage spontaneous brainstorming and quick check-ins.
3. Foster a Culture of Respect for All Contributions
The success of each team—whether they’re keeping the bank running or pushing forward new ideas—contributes to the overall mission. Recognize and celebrate the achievements of every team, making sure innovation is seen as vital to the bank’s growth.
- Example: Host regular “show and tell” sessions where teams can share progress on their projects, highlighting how each function supports the bank’s mission.
4.Develop Cross-Functional Goals
Set shared objectives that require input from each team. This approach encourages collaboration and breaks down silos, making it clear that innovation isn’t just an isolated effort but a shared responsibility.
- Example: Define a goal, such as improving customer experience, and assign roles to each team. Operations might streamline processes, transformation could implement new tools, and innovation could explore advanced technologies for customer interactions.
5.Provide Leadership Support for Innovation
Leadership’s commitment to innovation can make all the difference. When leaders emphasize the importance of future-focused projects, it sends a clear message that innovation is a bank-wide priority, not a side project.
- Example: Have executives sponsor an innovation initiative, showing tangible support and engaging directly with the team. This signals that innovation is valued at every level of the organization.
The Impact of a Respectful, Integrated Workspace
Creating an environment that respects each team’s unique focus isn’t just about better seating arrangements or more resources. It’s about transforming the way each function sees itself and interacts with others. In a setup like “The Flexible Office,” innovation isn’t hidden in the basement—it’s front and center, part of the bank’s broader mission. Every team has a role to play, and every role is respected. The result? A bank that’s resilient, forward-thinking, and prepared for the future.
This shift to an integrated approach benefits not just the innovation team but the bank as a whole:
- Stronger Collaboration: When teams are physically and strategically aligned, they work together more naturally, with less friction and more synergy.
- Increased Morale and Engagement: Teams feel valued and motivated, knowing their work is respected and contributes meaningfully to the bank’s success.
- Enhanced Agility: With every team working cohesively, the bank can adapt more quickly to industry changes, staying competitive and relevant.
Building a Culture of Respect for Every Role
As banking continues to evolve, the need for innovation grows. But to unlock the potential of innovation, we must bring it out of the basement and into a space where it’s respected, supported, and integrated with core operations. By creating environments like “The Flexible Office” where each team has its own focus and yet contributes to a unified mission, we’re building banks that aren’t just managing the present—they’re shaping the future.
As you think about your own organization, ask yourself: Is innovation being sidelined, or is it part of your bank’s everyday strategy? By making innovation visible, valued, and supported, we create a foundation for sustainable success that honors every team’s contribution. Let’s move from isolation to integration, and from neglect to respect, ensuring every team has the resources and recognition it deserves.
#CoreBankingTransformation #RunChangeInnovateTheBank
