Building Blocks for
Success in 2020
How can banks go beyond just surviving
to thriving in 2020?
Sustainable competitive advantage. Banks can
capture it by leveraging three building blocks—
optimization and simplification, agility, and
continuous innovation. Doing so could mean
pre-tax return on equity levels of up to 18 to
25 percent.1
A journey through rough seas
Building scale was once synonymous with
marketplace dominance for North American
banks. But in the era of convergent disruption,
scale is not enough. From consolidation to
digital banking, complex forces are
redefining the banking landscape.
An evolution, not a revolution
It’s easy to see how banks can get
marginalized in a swirl of challenges.
The good news is that an incremental path
forward to sustainable competitive
advantage exists for banks that invest
proactively in their own futures.
It all begins with optimization and
simplification. This is working as efficiently
and effectively as possible in the existing
structure. Consider it a baseline, something
most banks are already doing—eliminating
accumulated complexity that limits them.
This may be by improving channel
fulfillment, streamlining the business with
enabling technology, or taking other actions.
Yet optimization and simplification only
take banks so far. Improving profitable
growth will require agility. From embracing
digital throughout the business to reinventing
customer experiences, agility is seizing
opportunities and managing change as a
tailwind. While banks have yet to achieve it
broadly, agility is the new baseline for 2020.
Finally, banking leaders in 2020 will stand
apart through continuous innovation. The
highest performers will be disrupters
moving forward—acting as first movers in
key parts of their businesses. This is not
continuous improvement, but rather a
willingness to redefine the banking
landscape by introducing and responding
to disruption.
Chart a new course to 2020
Most banks understand that they will have
to makes some changes to realize sustainable
competitive advantage. A clear path for
success exists for those that start now.
Source: Accenture research analysis using SNL
financial data, historical, current and projected
financial performance of today’s top 22 North
American banks with more than $50bn in assets.
1
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