22 Jul

Disruptive Forces in Financial Services

Competition in Financial Services has always been intense amongst industry rivals. Increasingly, firms find themselves competing with Financial Technology (FinTech) start-ups going after a selective slice of the market with a disruptive offer.  Many FinTech firms have billion dollar valuations, are flush with cash, and are leveraging low cost, cloud-based delivery models. While incumbent firms have invested heavily over the years in a combination of technology-based infrastructures like ATM networks, branch office makeovers, online services and mobile apps, they still feel vulnerable to the threat of FinTech firms grabbing market share in specific areas like retail payments or online lending.

When clients share these kinds of challenges with Line of Sight Group, our first inclination is to turn our eyes and ears to the external environment and to connect the dots around what is happening, as well as what is likely to happen.  Thus informed, threats and opportunities emerge and become discussion points for the formation of strategic plans and subsequent go-to-market initiatives.  Financial Services firms have a vast array of levers to pull when it comes to competing successfully.  Technology is but one of these levers. Some firms find that their physical locations can be leveraged if they reconfigure them into optimized networks based on the specific needs of their clients.  In some cases, they may opt for a smaller branch footprint but implement Interactive Teller Machines that match a specific financial expert with a client virtually. Other Financial Services firms are partnering with FinTech firms by bringing new offers into these networks and blending them into a portfolio of offers.  Another tactic is to conduct hundreds of controlled tests annually (AB Testing) designed to gauge and measure consumer preferences and to then create new offers based on the results.

Line of Sight Group Financial Services clients utilize a number of methods to listen to the external environment in which they play. Some firms utilize strategic competitive monitoring on an ongoing basis to gather, sort and analyze value propositions, pricing and customer satisfaction levels. Financial Services clients who position large commercial offers utilize Win/Loss Analysis to understand why they win and lose deals. Firms seeking to enter a new market employ a Competitive Landscape Analysis to gauge the status quo and to look for unmet needs before making the move to invest.

By understanding the external environment on a continual basis, Financial Services firms can better navigate the ever changing mix of consumer preferences, technological advances and business model iterations to make good decisions. Technology is important, but rarely the only factor to consider.

12 Jul

Top Five Digital Health Trends for 2016: Disruption Can be a Game Changer if a Business Can Predict it

According to Accenture’s report, Top Five Digital Health Trends for 2016, “Disruption can be a game changer if a business can predict it.”  Here are the trends they identify and break down:
  • Intelligent Automation – big data, digital apps and devices handle the basics allowing people resources to focus on higher value tasks
  • Liquid Workforce – technology has enabled anywhere, anytime access to healthcare. Crowd sourcing and workforce flexibility are leading to better outcomes
  • Platform Economy – technology-enabled networks and the ability for consumers, providers, payers, and employers to all access them yield better outcomes at scale
  • Predictable Disruption – once the ecosystem is established, it becomes more powerful with the addition of new, innovative offers. Many are coming from outside of health care such as gaming and consumer-based technologies
  • Digital Trust – as ecosystems grow larger, vulnerabilities increase.  Yet, consumer demand for security and privacy remain high

Predicting disruption across digital health encompasses a dizzying array of forces at play – technology, economic business model, consumer engagement, regulatory, and more.  A thorough understanding of the competitive landscape where you play is a great first step to take if your market is rapidly changing.

This link will take you to a Sample Report for Line of Sight Group’s Competitive Landscape Program, making sense of disruptive and chaotic forces for our clients: Competitive Landscape Sample Report.
07 Jul

The Challenge of Being Different

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In a past life, I held the position of a product manager for a company that was the leader in a substantial and mature industry. As a product manager, I learned many things:

  • First I learned that the product manager role in any organization is extremely hard work and not for the faint of heart. I mean, who would even want the job of being in the middle of demanding customers, unruly salespeople, tentative engineers, anxious operations managers, out of touch managers and cautious finance and accounting folks? Sounds like a perfect job for a middle child, which I am not. In addition, even though we had good market research, I always felt like I was running in circles, responding to the largest customer or market anecdotes without a good sense of the real market needs
  • Second, I learned that responding to those counter pressures was the safest way to operate. While it was considered ‘customer focused’, in the end, our efforts often resulted in product features and pricing models that looked pretty much like everything else in the market, even though internally we felt we had invented something unique
  • Last, I learned that working to make my product line truly ‘different’ in the market required skill, courage, leadership, and even a little luck.

In her book ‘Different: Escaping the Competitive Herd’ Harvard Business Professor Youngme Moon describes the concept of ‘category blur’. Her argument is that once a product category becomes a blur to customers, they start to adopt a consumption posture directed toward the category as a whole, as opposed to the individual brands within it. Professor Moon says, “We [buyers] no longer see the trees for the forest so we cop a stance toward the forest instead.” On the other hand, what she terms ‘breakaway’ products and brands deviate from these stereotypes in such a way as to cast doubt on the validity of the original generalizations.

The concept of ‘different’ implies the ability to compare and contrast one against another – for both customers and product managers. In order to deliver products that are truly different product managers must start with knowledge of his or her own product, production and pricing capabilities, etc. (the internal environment). At the same time they must have deep knowledge of the competitor’s products and capabilities along with buyer needs, perceptions and behavior (the external environment). In addition, since the external environment is constantly changing as customer needs change, competitors change, and technology and other trends drive change, the awareness of differences must be continuous. (Refer to the difficult role of the product manager above).

When we started working with one of our very good clients several years ago, the senior executive told me, “We have launched so many new products and product improvements over the years that have failed.” He added, “They not only cost money but hurt our reputation with customers, and we know that solid investment on the front-end is critical.”

It is the external environment where Line of Sight Group helps our clients. Our approach is to help product management professionals improve their effectiveness by collaborating with them to ‘out-smart’ their competition by identifying the disruption that represents opportunities and threats before their competitors do. We help them benchmark the competition, watch their ever-changing external environment and help them connect the dots. They apply the insight to close gaps to reduce risk and Identify ‘white space’ opportunities to make their products truly ‘different’.

As noted above, sometimes being ‘different’ requires a little luck beyond the leadership and hard work of a product manager. Sometimes that luck comes in the form of additional knowledge and insight – and it can mean all the difference.