Title: Visions of the Future Defining the Future of Banking Cleveland Council on World Affairs Jeff Carter
1Visions of the Future Defining the Future of
BankingCleveland Council on World AffairsJeff
Carter Center for Future Banking Executive
2When it comes to the future, there are three
kinds of people those who let it happen, those
who make it happen, and those who wonder what
happened. (John M. Richardson, Jr.)
3Unparalleled Franchise
Differentiators
4Differentiators
Leader in Cornerstone Products
- 14 Retail deposit market share
Deposits
Credit Debit Card
- 8 Direct to consumer mortgage market share
- 11 Home equity market share
- 20 US credit card market share
- 17 UK credit card market share
- 17 debit card market share
Debit share as of 2006, all other share data as
of Q4 07
5Where Customers Want and Need Us to Be
How We Grow
1M Users Can reach 75 wireless subscribers
Customer
24M Active Online Users
2.6B Contacts
18,500 ATMs
6Innovative Products and Services
How We Grow
7The emergence of financial services as
innovators?
Emergent Innovators
1
Financial Services Representation in Business
Weeks 50 Most Innovative Companies (2005 2008)
5
15
25
35
45
50
2005
8The Outstanding Corporate Innovator (OCI) Award
2006 OCI Winner
- For the past nineteen years, PDMA has presented
the OCI award to organizations that both
exemplify the spirit of innovation and
demonstrate the ability to consistently transfer
their creative ideas into successful new products
and services. - The basic requirements for receiving this award
are - Sustained success in launching new products over
a five-year time frame. - Significant company growth from new product
success. - Well defined new product development practices
and processes that can be described to others. - Distinctive innovative characteristics and
intangibles.
9There is no doubt we are experiencing
unprecedented change.
10How fast do things change?
Unprecedented Change
- Costs For Storing 2 File Cabinets Of Scanned
Documents, Or 1 Gigabyte Of Data - 1992 1,000
- 2002 2.53
- 2010 0.01 est
- Costs For Storing 2,000 File Cabinets,
- Or 1 Terabyte Of Data
- 1992 1,000,000
- 2002 2,500
- 2010 21 (est)
- Based On Storage Keeping Pace With Moores Law .
. . - The iPod of 2015 will come pre-loaded with every
book, movie and song ever recorded
11Historic levels of growth
Unprecedented Change
- It took 100,000 years 300 generations . . .
- Domestication of animals
- Invention of money
- The craft system of mass production
- The rise of the city and modern state
- Invention of the steam engine, internal
combustion engine, atomic power - The telegraph, the telephone, motion pictures and
television, flight - The computer, the internet, wireless telephony
- The birth of representative democracy, common
law, and market capitalization
12Historic levels of growth
Unprecedented Change
- . . . To arrive at in 2001
- An Integrated, Networked Market Of
- 1 Billion Human Beings
13Historic levels of growth
Unprecedented Scale
- 6 years later, in 2007, the 2nd Billion arrived
- 700,000 new people join every day
- Sometime in 2011 the 3 Billionth person will join
the networked economy roughly 50 of the worlds
population
- This massive growth in networked consumers will
not be - Homogenous
- Predictable
- Static
14And speed.time to 1mm users
Unprecedented Speed
- Quicken 70 months
- BAC Online Banking - 36 months
- eBay 30 months
- BAC Mobile Banking 12 months
- Facebook 10 months
- iLike 3 days
15Industry pool shifts
Unprecedented Disruption
Drivers for change
- Disruptive Technology
- Changing consumer behavior
- New entrant in marketplace
- Regulatory pressure
16Time for an industry shifting move
17First of its kind research center
Vision for the Future
- One year ago, Bank of America began working with
MIT on a vision for creating a first of its kind
Center to explore the future of the Banking
industry. - On April 1, 2008, Bank of America announced a
joint venture with the MIT Media Lab to
collaborate on the Center for Future Banking. The
C enter will explore new ideas in banking by
inventing technologies that reveal and leverage
insights across a wide range of physical and
social scales. - The MIT Media Lab was chosen because it applies
an unorthodox research approach to envision the
impact of emerging technologies on everyday
lifetechnologies that promise to fundamentally
transform our most basic notions of human
capabilities.
18First of its kind research center
Vision for the Future
- Media Lab unique in the world technologies that
disrupt industries (publishing, music, mobile),
transform societies and improve the quality of
life everywhere - 100 companies, 400 research activities, most
have been here for 10 years, meaning we are very
late to the game - 8 themes 5-10 activities each 30 of the
worlds premier research lab working on behalf of
Bank of America and the Banking Industry
19Research Agenda
Vision for the Future
20With research can you predict the future?
Final Question
- Sometimes predictions do come true.
- A future device for individual use, which is a
sort of mechanized private file and library. . . - First (one) runs through an encyclopedia, finds
an interesting but sketchy article. . . - Next, (one) finds another pertinent item, and
ties the two together. Thus (one) goes, building
a trail of many items. . . - Wholly new forms of encyclopedias will appear,
ready made with a mesh of associative trails
running through them, ready to be dropped into
the (device) and there amplified
21Raising the bar
Closing
- Bank of America continues to invest in innovation
- Success in the future will require new levels of
collaboration - Customers will be a part of this collaboration
and an integral part of a core transformation
strategy - The game has fundamentally changed
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