“Complexity is our enemy,” said Rune Garborg, Executive Vice President at DNB.
It’s an intriguing way to characterize an innovation challenge. Norway’s largest and oldest private bank has to compete on numerous fronts, often facing competitors that didn’t even exist a year ago. Add to that the fact that many of those competitors are committed to using technology, customer-centricity, and marketing to disrupt DNB’s business.
“The competition is prompting us to do new things, and do them faster,” he continued.
“We have to change our culture and mindset, and that starts and ends with embracing simplicity.”
Garborg continued: “We have lots of good ideas, maybe even more than we need. But the complexity of implementing them in an organization as large as ours can kill too many of them. Customers aren’t asking for complex products or experiences, either.”
So DNB’s innovation program is based on simplifying processes, integration, and the number and functions of products it offers to customers. In 2013, it reorganized its staff to focus on categories of its business — payments, loans, insurance, and savings — and tasked the teams to innovate simplicity in processes and offerings. Its category managers meet several times a week to find ways to simplify work across the organization.
A separate group focused on future banking is tasked with identifying cutting-edge opportunities for the categories to explore, but that, too, is founded on the premise that simple is better.
The impact of the strategy can already be seen in DNB’s savings product offering size, which has been cut in half over the past two years, and could get as low as 30 products.
It’s also apparent in new customer programs. DNB announced a payment service called Vipps in June, which simplified account access and prompted over 1.4 million downloads in seven months. (That’s 1/4th of the entire population of Norway, by the way.) By giving them better alternatives online and in nearby grocery stores, manual transactions in DNB’s branches have been reduced by more than 80% during the last year.
On the other hand, DNB and its partner Telenor, worked for several years with a mobile payment solution called Valyou, which relied on an onboarding solution that was somewhat too difficult for customers, and thus did not get a significant number of users. The service was then discontinued.
“When we get the offering right, the value of our reputation and customer insights can make the competitive difference,” Garborg said.