Strategic Choices for Growth
The changing businesses in the financial services are gaining momentum mainly due to rapid developments of digital trends. For firms to prosper, they need a profound understanding of growth and profitability. We analysed the largest banks in the world and found that they are much less profitable as they appear to be. Growing profitable and faster than investors expect is vital for listed equity firms to get further investments and gain competitive edge. Our case studies corroborate the meaning of profitable growth and explain how wealth manager can become really big. We discuss acquisitions, global expansion strategies, but also the importance of a strong brand value. What history and reputation are for financial centres, the imperatives for asset managers are size and scope. Firms such as BlackRock and Vanguard but also the growing sovereign wealth funds dominate the industry. Firms must address growth and innovation at the highest possible level to gain competitive advantage. Thus, we suggest appointing chief officer roles to foster growth. Finally risks increase exponentially with every participant in the ecosystem. Incumbents that manage an innovation portfolio, including internal projects and external businesses, must apply risk management measures like the venture capital industry.