Reading List: Ginni Rometty and Alejandro Valenzuela, CEO of Banorte

By | July 7, 2014

Sometimes something happens inside IBM that I really enjoy, treasure and want to refer back to.  I blog about these things so that I don’t lose track of them and to make them available to others, even it is only my IBM colleagues.

Here is the link where Ginni Rometty speaks with Alejandro Valenzuela, CEO of Grupo Financiero Banorte, and asks for a CEO’s perspective on Big Data & Analytics.  Unfortunately, this link is inside the IBM firewall.  If I find an external link I will make it available to my clients and friends outside IBM.

I do not quote either Ginni or Alejandro here.  This blog contains my own thoughts after watching the video.

My favorite part of this discussion goes beyond big data and analytics to transformation and corporate culture.  It goes beyond Banorte because Alejandro describes an issue that I have seen trip up banks as far away as Malaysia.  Very simply, when an organization is in the midst of current success, it is very difficult to convince them that they need to radically change.

It is as if you are leading a battle and, while not defeating the opponent, maintaining an upper hand.  Morale is high and everyone is confident on the battlefield.  But you are looking over the horizon from higher ground behind the battlefield.  You can see what others cannot see.  And you see dozens of small armies with diverse capabilities and intentions coming toward the battle field from many directions.  Your team needs to prepare.  Preparing them is not the chief difficulty–convincing them that they need to prepare to fight a different battle is the challenge.

I am thinking about the trends that I have identified in my “Trends” series and that most of the tools in service design are communication tools.

Banks sell commodities and their primary differentiator is their knowledge of the clients and consumers.  Banorte is looking to supplement that knowledge with analytics to the extent that they can without raising any privacy concerns.  Banorte wants to pull clients as opposed to pushing products and this requires a better understanding of clients.

Also discussed was the importance of maintaining trust in the client/bank experience and the implications of this on data privacy and security.

Banorte was created in 1899 as a regional bank in Northern Mexico and is now a national bank and the 3rd largest bank in Mexico.  About 27,000 employees.  Worth about 18 billion dollars.  The Group does a little bit of everything — retail banking, insurance, pension funds, leasing, factoring, etc.  12 million clients at the bank and another 12 million at the pension fund company.  About $1 billion of profit per year.  15% return on capital.

Alejandro discussed the importance of moving from uncertainty to risk and dealing with risk, and how this requires data and analytics.  He also noted that systems of engagement that are infused with data and analytics provide the ability to go back to one-on-one interactions that are lost to some degree when organizations begin operating at scale.  Also, getting the right insights so as to take the right decisions is fundamental to all organizations.  Analytics can also be used to protect clients from fraud, for example.

Press release about Banorte / IBM partnership.

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