Book recommendation– Innovations and innovation management in the financial sector

Transformation of an analogue private bank into an innovation driver

Co-Author: Jochen Werne

Chapter: Transformation of an analogue private bank into an innovation driver

Find a reading extract here

Buy at Amazon / Springer Shop / Thalia / Hugendubel / GooglePlay

published by Springer

Content extract

Chapter 5: Transformation of an analogue private bank into an innovation driver
Reflection on change, technological progress and human behaviour in disruptive times
The article analyses and discusses the changes, challenges, decision paths and implementation practices of Bankhaus August Lenz in the years 2014 to 2016. In addition, the author would like to provide executives and managers entrusted with the transformation of their institution with practical arguments that may help them to cope better with daily challenges in change management practice. As a traditional private bank with a European parent, the task was not only to complete the transition away from a fully analog bank, but also to adapt the Group’s strategy for the German market with the budget adapted to the size of the institution. The most important internal customer was also integrated into the change: the Family Banker®, which is at the heart of the philosophy and is responsible for customer contact. This human contact and personal contact is the guarantee for the indispensable relationship of trust between customer and bank. The author examines issues such as coopetition, agile project management approaches and cooperation with FinTechs. In addition, topics such as value proposition, behavioral finance, the need to concentrate on core issues, the importance of personal consulting in the digital age and exchange in an international working environment as well as communication are treated as essential success factors. The paper does not claim to be perceived as a scientific work, but focuses on the practical implementation of the core problem of a market participant in a disruptive market – the question of how to restructure and realign companies in order to continue to play a role as a market player in the future.

French government invites Expedition Antarctic Blanc

Initiated by French President Emmanuel Macron, it’s a great honour having received an invitation from the French Ministère de la Transition écologique et solidaire to hand over the French expedition flag to Mme Sophie-Dorothée Duron, Conseillère Biodiversité Eau Mer in the Cabinet du Ministre

On 1 April 2019 at 4 p.m., Mme Sophie-Dorothée Duron, Conseillère Biodiversité Eau Mer will welcome a delegation from the international expedition Antarctic Blanc, which was successfully carried out with French assistance. The delegation will present the expedition flag, which represented France in Antarctica, as a symbol of remembrance.

French President Emmanuel MACRON personally underlined in his letter of support to the Expedition how important the preservation of our planet’s ecosystem is and how valuable therefore the creation of awareness in the society by the initiative.

Letter from the Elysée Palace supporting Expedition Antarctic Blanc

STORMS AND ICEBERGS

Expedition Antarctic Blanc pursued historical, social and environmental goals. The 12 expedition offshore participants of the initiative, supported by the United Nations and 19 states, crossed on a 20m sailing yacht twice in 12 days, under the toughest conditions, one of the most dangerous sea routes in the world – the Drake Passage, covering 1129 nautical miles (over 2,000km). The journey was marked by the passage of several storm systems in the Antarctic and off Cape Horn, which delayed the return by several days. Winds with up to 50kn, waves up to 8m high and temperatures around freezing point demanded top physical performances from the expedition participants.

INTERNATIONAL COMMEMORATION CEREMONY. Sailing on Historic Routes. The expedition commemorated the researchers, explorers and sailors whose ships had to master the challenging peculiarities of reaching an unknown part of the world. The international team held a commemoration ceremony on the historically significant Antarctic volcanic Deception Island. In the name of all supporting states and the United Nations, a wreath of local ice was symbolically formed and laid down in order to pay international tribute to the achievements in the exploration of this unique continent. The supporting nations are among the signatories of the politically unique Antarctic Treaty of 23 June 1961. Heads of state and government organizations of the 19 nations have expressed their support for this unique, privately initiated expeditions in letters to the leader of the expedition, Jochen Werne, in particular for the execution of the ceremonial act of commemoration.

FRANCE AND THE ANTARCTIC TREATY. France joined the Antarctic Treaty on 23 June 1961 and, with its signature, also acknowledged that “in the interest of all mankind, Antarctica is used exclusively for peaceful purposes and should not become the scene or object of international discord”. France also underlined its commitment to the preservation of this ecosystem as a “nature reserve dedicated to peace and science”.

UNEP CLEAN SEAS INITIATIVE. The main focus of the expedition was to sensitize the international public for the preservation of the unique Antarctic ecosystem and to support the UN initiative Clean Seas to combat plastic waste in the oceans. With Expedition Antarctic Blanc, this important United Nations Environmental Program project is now finding acceptance on all continents of our planet.

CONSEQUENCES OF CLIMATE CHANGE ON THE ECOSYSTEM. In addition, the expedition supported the University of Connecticut and Northeastern University’s research project on plankton metabarcoding by collecting plankton samples, which could provide a fundamental contribution to obtaining rapid responses to the ecosystem’s response to climate change.

WHALES IN THE ANTARCTIC. With the observation of 18 different whales and the detailed documentation of their position and behaviour, the expedition also contributed to the establishment of the global whale observation platform ‘Happy Wales’. The platform is intended to provide science with in-depth insights into the behaviour and development of the largest mammals on our planet.

CHILD AND YOUTH DEVELOPMENT. To promote international children and youth projects, several live broadcasts were held from sea and Antarctica with children of the sailing school of the Yacht Club de Monaco. On their return, the team visited the Cedena Yacht School Puerto Williams, Chile, which is open to children from all walks of life in the southernmost region of our planet, and through sport encourages them to develop their own goals and character traits that are conducive to their personal development. In addition to a donation from the expedition team, the foundation stone was laid for an international exchange and the children were introduced to Antarctica and its significance.

INTERNATIONAL RECOGNITION. The visit to Paris marks the fifth important reception for Expedition Antarctic Blanc after the reception by Prince Albert II in Monaco, the ambassador of the poles of the Netherlands, Carola van Reijnsoever, in The Hague, the President of Austria Alexander Van der Bellen in Vienna and the Private Secretary to Her Majesty The Queen of Denmark Henning Fode.

PRESS INVITATION

  • Following the flag handover on 1 April 2019 at 4 p.m. in Paris, the expedition leader Jochen Werne and Chief Liasion Officer to France Olivier Blanchard will be available to the press for questions and interviews, pictures and filming.
  • On request, the delegation can also attend press events in Paris on this day.
    Accreditation is requested. Please send an e-mail to ExpeditionLeader@AntarcticBlanc.com for this purpose.

Expedition participants – Offshore Team

Jochen Werne Expedition Leader

Marco Schröter Chief Safety Officer

Oliver Picht Navigator & Chief Documentation Officer

Linden Blue Chief Communication Officer

Bernd Görgner Chief Medical Officer

Benon Janos Environmental Initiatives Coordinator

Wolfgang Händel Chief Logistics Officer

Hans Axtner Master of Ceremony

Michael Melnick Chief Sciences Coordinator

David Gamba Chief Observer

Wolf Kloss Skipper and Expedition Yacht Owner

Karl Papenfuss Mate

Comment on the initiator of the expedition – The Global Offshore Sailing Team (GOST)

Expedition “Antarctic Blanc” is the continuation of the polar initiative launched in 2016 with comparable objectives under the name “Arctic Ocean Raptor”, but in the Spitsbergen sea area and up to the Arctic pack ice limit. An additional and important aspect was the commemoration of the seafarers of all nations, who fulfilled their seafaring duties during the maritime operations in the Arctic under the mostly merciless weather conditions and partly also lost their lives. In the name of the Norwegian King Harald V and the Canadian government, a wreath was handed over to the lake; further international support for this expedition came from Belgium, Germany, Great Britain and Italy. Founded in 1999 by Jochen Werne and Guido Zoeller, the Global Offshore Sailing Team is once again committed to maritime history and environmental issues with this particularly challenging expedition and its People’s Diplomacy campaign.

Press contact:

Jochen Werne

Expedition Leader

Mail: ExpeditionLeader@AntarcticBlanc.com

Movie World Premiere: OCEANS IN DANGER

Expedition Antarctic Blanc supported with pride the new movie of producer Martina Hirschmeier

Martina wrote on Facebook about today’s premiere:

Martina Hirschmeier

“Tomorrow, Tuesday 19.2.19, 16 o’clock on the stage of the VBE in hall 8 on the #Didacta2019 #Premiere of #Oceans in danger. It is the most international and probably most important project I have ever supervised. Many thanks to the supporters, without whom we would never have been able to manage the project: the #loveyourocean Initiative, Sarah Kinloch #seashepherd Nicolai Duda, Frank, Madeleine von Hohenthal and Benjamin Wenke from #Bracenet, Martin Aigner, Reefcalendar, #Scubazoo, Cornelia Nauen, #Mundusmaris, Line Hindsbjerg, Emily Penn, #Exxpedition, Jenn Russell, #DeutscheMeeresstiftung, Ariel Lucero, Melina, Parinoshka Kobbe, #Tasini, Underwater Worlds, Katrin Haensch, Teresa, #Maketheoceansplasticfree, Mareike Huhn, Katrin Hans, Lena Löschel, #BandaSea, Jochen Werne, #Antarcticblanc, #Guppybag, Marcella Hansch, #MermaidKat, Esther Gonstalla, Ghost Fishing, Healthy Seas, Torben Cord, #Planctonchronicles, #PalmaAquarium, #MHouse. Thanks for the emotional support go to Melanie Künzl and Christina Schröter.”

After meeting Martina for the first time at the world’s largest boat show, it quickly became clear that her heart beats for our oceans and for educating children and young people about the importance of preserving our planet’s ecosystem. It is a great pleasure to support her new project and we are all looking forward to seeing “Oceans in danger” soon.

Jochen Werne
Expedition Leader
Expedition Antarctic Blanc
Facebook post by Martina Hirschmeier prior the movie premiere of Oceans in danger

New ways – Artificial Intelligence in Cyber Security

Defense against cyber attacks through new technologies

Author: Jochen Werne – published by Der Bank-Blog – 15 February 2019

Cyber crime has become a serious threat to business, politics and private individuals since a long time. New technologies based on the use of artificial intelligence might offer more security.

The fight against cyber threats has become significantly more complex for global government organisations, businesses, and individuals in recent years. Technical protection of IT systems and infrastructures and thus data security in the narrower sense are no longer the only issues. Companies, for example, need to address the much broader concept of information security.

Solutions based on artificial intelligence could prove helpful in the fight against cybercrime. According to a study by the IBM Institute for Business Value, the spread of intelligent, AI-based security solutions will increase significantly in the coming years.

Technical protective measures have long since been based on machine learning, for example, to identify spam or phishing e-mails or to record trends and anomalies in large amounts of data – both in data traffic within the corporate network and in its external connections.

Jochen Werne
Jochen Werne

AI systems for the identification of cyber attacks

In future, for example, systems might also be able to identify hidden channels in the corporate network through which cyber criminals attempt to acquire data. AI’s greatest strength, pattern recognition, enables automated detection of a wide range of anomalies and security incidents. For this purpose, however, AI-based systems must also learn to distinguish between common IT failures and cyber attacks. In addition, self-learning algorithms need to take internal corporate processes into account to come up with precise results.

In the near future, according to a forecast by Christian Nern, former Head of Security Software DACH at IBM Germany and today Partner at the Consulting firm KPMG, AI-based security analysis systems will be able to detect and fend off attacks proactively. Then, according to the former IBM security software chief, the confrontation between cyber criminals and security officers could possibly take place directly between the AI systems they use.

Germany as a pioneer country

Germany, which considers itself a pioneer country in the fields of learning systems and artificial intelligence, has already launched a platform for artificial intelligence on this topic initiated by the Federal Ministry of Education and Research (BMBF): “Learning Systems”. The platform with its 200 members brings together leading experts from science, business and society and deals with technological, economic and social issues relating to the development and introduction of learning systems on an interdisciplinary and cross-sector basis.

One of the seven working groups deals in particular with IT security, privacy, law and ethics. The composition of the topics in this group shows the interwoven culture-specific discussions that will later lead to scenarios, recommendations, guidelines and roadmaps.

Intelligent combination of available modules

As often in cyber security topics, there is no patent solution for the numerous questions and challenges. A company-wide risk management system, which establishes appropriate technical and organisational measures and also takes into account findings from psychology and cultural studies, seems to be a sensible way forward.

The right balance between security awareness and security, individual freedom paired with increased personal responsibility as well as support through technology and organisational structure is probably the most promising approach in the current state of research and technology to effectively meet the challenges for information and IT security.

Tradition meets modernity: Why more and more banks are relying on artificial intelligence

Artificial intelligence is finding its way into the highly regulated world of banking. And not only GAFA Silicon Valley high-tech companies see it as the technology of the future, but also FinTechs and established banks. How it came to this, what possibilities and limits there are at the moment and why humans will remain irreplaceable not only when it comes to money – the commentary

by Jochen Werne, innovation and transformation expert
Munich private bank Bankhaus August Lenz

Original published in German in the IT-Finanzmagazin (31 July 2018). Translation by DeepL

After “FinTech”, “Blockchain” and “Crypto”, “AI” is the new buzzword in the banking world. Whether chatbots in the digital customer center or self-learning algorithms for highly complex investment strategies are being discussed – the omnipresence of the term suggests that the integration of artificial intelligence into one’s own business model seems to be virtually vital.

Artificial intelligence and big data are currently the strongest and most vibrant innovation trends in the financial sector …

… was also one of the guiding principles of Prof. Joachim Wuermeling, board member of the Deutsche Bundesbank, in his speech on “Artificial Intelligence” at the second annual FinTech and Digital Innovation Conference in February 2018 in Brussels.

The choice of the conference venue, which like rarely any other city combines both a belief in progress and a deeply rooted European tradition, can hardly be more symbolic of the forthcoming change. In fact, the topic is by no means new: the development towards an increased use of so-called non-human intelligence is based on approaches from the 1940s – with the invention of the first computers

Artificial intelligence: revolution as a reaction to mountains of data?

But what is now possible in times of exponential technologies is in fact nothing less than a revolution. The financial industry is sitting on a valuable mountain of data, the extent of which is currently difficult to estimate. The maturing AI systems would not only make the preparation and processing of this data easier, but also much more cost-effective, faster and more targeted. Data already collected could become the most valuable raw material and a resource due to the technological leaps in the field of AI, which, in combination with the enrichment of external, non-structured data, must be “usable” in a meaningful way.

The industry is asked to use private data in a sensitive way for the benefit of the customer, – a goal that should certainly apply to all AI-based approaches.

To find meaningful regulations for the handling and the effects of the use of AI on society, economy and thus on our life and the work of tomorrow is the task of politics. The fact that this topic is taken very seriously is evident not only in national initiatives such as the German Platform for Artificial Intelligence “Learning Systems”, but also in the European Artifical Intelligence shoulder-to-shoulder approach, which is being pushed forward by France and Germany.

“Digital hand holding” in the event of a financial crash is not enough

At present, it is still too early to say which operational areas of the financial world will sooner or later be supported – in part or even entirely – by the use of AI systems. However, the financial crises of the past have shown this time and again:

Trust is crucial when it comes to money. Trust in the markets, the banking system and the human contact as an intermediary in a complex issue”.

However, the banking industry knows very well from its own experience how easy it is to loose customer’s trust. An experience that Mark Zuckerberg and Facebook recently also had to make in connection with the Cambridge-Analytica scandal. As with every new technology and every new approach, the same applies to the topic of “intelligent” systems: a lot of trust, coupled with half-knowledge and a big dash of emotionality results in a popular trend cocktail, which, however, bears a certain risk of headaches on the following day.

Jochen Werne

Jochen Werne is the authorized signatory responsible for Marketing, Business Development, Product Management, Treasury and Payment Services at Bankhaus August Lenz & Co. After two years as navigator of the sailing training ship ‘Gorch Fock’, the international marketing and banking specialist completed his studies as client coverage analyst at Bankers Trust Alex. Brown International and in Global Investment Banking at Deutsche Bank AG, he has worked on numerous projects in other European and American countries. In 2001, he joined Accenture as a Customer Relationship Management Expert in the Financial Services Division before joining Bankhaus August Lenz & Co. AG in Munich, where he has since been responsible for various areas of the institute. As part of the Innovation Leadership Team of the Mediolanum Banking Group, a member of the expert council of Management Circle and the IBM Banking Innovation Council, Jochen Werne is a keynote speaker at numerous banking and innovation conferences.

History lessons, international understanding & peoples`diplomacy: 76 years Channel Dash

On Feb 12, 1942, the Channel Dash happened. 70 years later, on Feb 12, 2012, the Global Offshore Sailing Team has been invited for the first time by the Channel Dash Association to commemorate brave air and sea man and to create and strengthen friendships between people and nations who were enemies in former times. Today at the 76th anniversary of the Channel Dash we continue the tradition to remember and to make us all aware how precious and equally vulnerable peace is. And therefore how important the engagement of our civil society is to strengthen the roots of peace every day.

12 February 2012: Jochen Werne, Skipper and Representative of the GLOBAL OFFSHORE SAILING TEAM (www.gost.org) is commenting the “Channel Dash” during the CHANNEL DASH ASSOCIATION’s 70th Anniversary Remembrance Event at the Royal Airforce Base Manston. The Team thanks greatly the CDA (www.channeldash.org) for the kind invitation and hospitality. The Channel Dash, (codenamed Operation “Cerberus” by the Germans), was a major naval engagement during World War II in which a German Kriegsmarine squadron consisting of both Scharnhorst class battleships, and heavy cruiser Prinz Eugen along with escorts, ran a British blockade and successfully sailed from Brest in Brittany to their home bases in Germany via the English Channel.* The Expedition Corps of the Global Offshore Sailing Team will leave – 70 years after Operation “Cerberus”– Brest on a 50ft sailing yacht on the historical footsteps of this spectacular operation. This historic research Expedition “CERBERUS” 2012 wants to be a platform for remembering and honoring all woman and men who fought on both sides with great bravery. The Daily Mail reported in 1942 “This is an episode of which Britons can be rightly proud. In planes which, against the German protecting aircraft, were as slow as a cart horse compared with a motorcar, 18 men of the Fleet Air Arm flew over the Channel. Crippled and ablaze before they got within range, they kept on, delivered their attacks – and died!” *www.wikipedia.de

GOST Expedition Cerberus

We also want to remember the man who inspired us so much bringing our goal of creating international understanding forward: Peter Nixon

Peter Nixon, Chairman of the Channel Dash Association once reflected about history and human mankind with the following words:

„ … working so hard to bring history back to everyone`s attention and recognizing the many great acts of courage performed on our behalf by men and women of all sides during a period of conflict. … It is not about Winner`s or Loser`s. … The world is a wonderful place to live because it is made up of many different, but beautiful countries.… We should be proud of this fact. Equally, we should not be ashamed of our past, nor should we glorify it, for it was our past which created what we are today.”

Peter Nixon
Peter Nixon

The world lost in July 2018 an outstanding personality and many of us a dear friend. His ideas and inspiration will remain with us. Jochen Werne Co-Founder – GOST

You’re the captain, but with what ship and crew?

MANAGEMENT IN DISRUPTIVE TIMES

Author: Jochen Werne . Firstly published in the Academy for Leadership column in German. Translation supported by DeepL

“An analogy for business leaders in the financial industry that compares the challenging times of today’s technological enterprise transformation with the changes during the time of the industrial revolution when steam ships ended the centuries-long era of sailing ships.”

In 1971, the BBC began broadcasting a series on the history of James Onedin, who, as captain and later as shipowner, lived through the stormy times of industrialisation and the conversion of the entire industry from sailing to steam navigation. The series, which takes place in Victorian England in the second half of the 19th century, describes in a special way the subtleties of the interplay of a changing market. New technologies, new skills of market participants, increased conflict potential between entrepreneurs and managers and reorientation in an environment of shrinking margins – special challenges for those who tried to continue their business as before: with sailing ships.

The documentation shows impressively how highly hierarchical organisations like the Royal Navy react and often struggle in times of major technological changes

The captain is responsible for bringing his ship, crew and cargo safely and within a specified time and financial framework to the port of destination. But what if the ship is no longer able to do this and the competition suddenly moves across the blue oceans with completely different ships? What if the shipowner does not have the capacity to trust the new technologies or simply does not have the financial resources to re-equip his fleet? And what about the crew? Does the crew has the necessary skills to sail on the new ships?

Many captains of banks and financial institutions seem to have this scenario all too present. E.g. due to declining customer traffic in bank branches, the high costs for a broad branch network are hardly to be paid today. Germany as a financial centre is “overbanked”, interest rates in the basement – the conditions in Germany for successful banking have never been as challenging as they are now. To this end, customers are continuing to drive change in the industry with their changing demands on digital tools.

Outwaiting a problem or tackling it

The complexity of economic changes has been enormous in every epoch, the difference to current upheavals lies in the temporal component. If companies do not react immediate to market changes today, they might loose their customers faster than ever before. In such disruptive times, all those involved want an “efficient” change process. The only problem is that the term “change” is so omnipresent that it is often perceived as stress and overload. As a result, many levels of management fall into one of the following situations: either they try to sit out the situation and leave change to their successors, or they push many, often less effective measures in an attack of blind actionism. Active, thoughtful and vital change management is often neglected.

More entrepreneurial thinking

Processes of change require both superiors and employees. If the existing situation cannot be improved or adapted at any vertical level, it must be questioned. Concluding, this means for all those involved that situations must always be reflected and corrective measures initiated at an early stage.

Understanding the corporate culture is vital for a successful transformation

In many companies, however, this need for action, which has a high potential for conflict, is often insufficiently communicated. In some places there is a lack of interest for employee issues, a lack of error and conflict culture and a minimal willingness to change. If banks neglect these issues, change processes threaten to fail on a broad basis. This means that managers in a disruptive environment have a natural need for action. The implementation of new strategies, systems and structures and early adaptation to changing market situations are vital factors for survival. A well-known quote by former US President Wodrow Wilson (1913-1921) is particularly valid for today’s highly competitive financial sector: “If you want to make enemies, try to change something.”

Those companies that create the change will share the large financial services market with the new market players and use instruments that did not exist in the classic banking of the past.

Just like James Onedin, who for the longest time was an advocate of classic sailing ships, finally added a modern steamship to his fleet. And to facilitate the change for himself personally, he named the ship after someone he loved.

Presidential reception for Expedition Antarctic Blanc reaches more than 1.5 million people

The two largest Austrian newspapers “Kronenzeitung” and “Heute” reported on the official visit of a delegation of Expedition Antarctic Blanc to the Hofburg. Together, the publications have a circulation of more than 1.5 million copies per day.

We are grateful to President Alexander Van der Bellen for the invitation, the President’s Press Corps and the press for the publications that support the goal of raising awareness of such important issues as the UNEP Clean Seas Initiative, the fight against microplastics in our oceans, the importance of Antarctica for our ecosystem and the importance of international cooperation and understanding.

Austria has a long standing tradition in Polar Research leading to the Austrian Polar Research Institute, who’s coordinating today the country’s activities in the Arctic and Antarctica

The delegation consisted of

Jochen Werne (Expedition Leader); Andris Adam (Chief Liason Officer to Austria and Hungary); Götz Credé (Chief Liaison Officer to Belgium, Denmark and The Netherlands); Dr. Wolfgang Händel (Chief Logistics Officer); Prof. Dr. Andreas Richter (Founding Director of the Austrian Polar Research Institutes); Christin Latk (Expedition Support Team – Akademie der Führungskräfte)