How ING is innovating its way to the bank of the future

How ING is innovating its way to the bank of the future

In cooperation with Holland Fintech, Accenture and others we created a new report on the Dutch banking innovation ecosystem. Based on Ross Republic’s project work with several international banks, we provided an outsiders’ view on how Dutch banks are preparing their organisations for the future.

As part of our research process, we interviewed some of the leading Dutch banks in order to get direct insights about their innovation activities. We particularly looked at three dimensions: organisational structures and processes, product portfolio and value proposition. This spin-off article covers our interview with ING. We sat down with Remco van der Veer (Head of ING Labs) to discuss how ING has managed to evolve into an innovation powerhouse.

About ING
ING is a global financial institution with a strong European base, offering retail and wholesale banking services to customers in over 40 countries. The purpose of ING is to empower people to stay a step ahead in life and in business.

In the recent years, many European banks have started to transform their organisations. Competitive pressures, customer demand, new technological developments as well as heavy regulatory burdens force them to search for new growth opportunities. ING is one of the leading banks that has pursued a radical organisational redirection since several years now, thus we kicked off our interview by discussing Remco’s role as Head of ING Labs and the intention behind the entity.

Hi Remco, could you first explain your role at ING and what you like most about it?

“Sure. My name is Remco van der Veer, I’m the head of ING labs. The lab is a setup we created to look at beyond banking and disruptive innovation. So far we have set up our labs in Amsterdam, Singapore and London. That’s my main responsibility area and I report directly to the Chief Innovation Officer. Within this role and within the company we have the ambition to look beyond what we would traditionally do as a bank. So to be able to open up to go beyond banking, while also trying to utilise strong points of the main company, that’s very exciting. Another point I like is that we created a ring- fenced environment, where initiatives have room to grow, get traction, but still are connected to the business with enough freedom to achieve early potential. We’re also not set-up as a showcase or a marketing instrument, but we are really striving for impact.”

How would you describe ING’s approach to innovation and the key objectives behind the innovation efforts?

“The introduction of agile allows us to be more flexible within the organisation, to be able to work in sprints and be more customer centric. We actually brought that to a next level by introducing PACE, where we combine the skills of design thinking, lean start-up and agile, to really be able to validate customer needs and pain points before we develop. I think the strong point is that this is something we’re not doing on an island, but we have implemented it organisation-wide.

ING is of course divided in different business units and we also have the labs environment. So, for the horizon one activities we are set up to innovate following our methodology, PACE, which we introduced in a wider setting with its own governance. So the business takes care of these developments to bring new propositions and service models and extensions of what we already have to the market.

We use the same methodology within the labs, but there we focus more on horizon two and three. That’s going beyond banking, so there it helps to have the freedom to think outside of the existing organisational constraints. But you are of course aware of the context you’re developing in.

So we use the same methodology and we sharpened it a little bit more to stronger business outputs and separate governance. But in the way we implement it and apply the rules that we are using is consistent throughout the company, which also gives it a clear face to the wider organisation about our way of innovating. That’s also why we don’t call it invention, because we really strive to tie it together with business models or in horizon one to direct business or customer benefits.”

How do you ensure to avoid the typical innovators dilemma?

“If you find something that is really disruptive to the core business, then you have to be smart about where you implement it or where you take the first steps. What is key for us is that from the start we always connect the innovations to business sponsorship. So we also always have them informed and working with us and sponsor the initiatives from the start to actually prevent these challenges later on. But it’s always a conscious decision, of course, what you want to progress and what not. A very clear governance and early business sponsorship is key.”

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