Major European banks and insurance companies are ready to embrace digital technologies, but they are nearly 50 percent more effective in identifying the value of innovations than actually applying them to streamline their businesses, according to an Accenture analysis of 53 institutions in the continent’s five largest economies.
Accenture’s “European Financial Services Digital Readiness Report” found that – on a scale of one (basic level) to four (best practice) – major banks and insurers across UK, Italy, Germany, Spain and France scored an average of 3.15 for recognizing the importance of digital as part of their strategy and only 2.10 for their progress in actually using digital solutions to streamline activities.
The analysis, which is designed to reflect customer and investor perceptions, is based on publicly available information, such as annual reports, websites and news releases, and uses more than 100 metrics for evaluation.
No Clear Regional Leader
According to Sushil Saluja, senior managing director of Accenture’s Financial Services group in Europe, Africa and Latin America: “No one country can boast being a digital leader in Europe. When viewed through a geographic lens, the research results indicate varying levels of digital maturity among banks and insurers within each of the five European countries included in the study.”
The report found:
- UK financial services firms outperform in the planning dimension but have room for improvement in the execution of digital strategies, the design of new products and services and digitalizing their internal processes.
- German institutions are followers in the dimensions related to digital strategies, indicating a less mature market, with most effort needed to catch up in embracing digital internally.
- Italian and Spanish institutions overall need to embrace digital more in their growth strategy, but may be more consistent than others when it comes to implementing their declared digital initiatives. They record poor results in embracing digital in their internal activities.
- French institutions have a clear digital agenda and are better at leveraging digital to engage with customers. But like other European players they fall short in embracing digital for internal activities.
Massimo Proverbio, senior manager director of Accenture’s banking practicein Europe, Africa and Latin America said: “Top European financial services firms see digital as a key component of their growth strategies, and, in many cases have devised a partial plan on how to integrate digital activities into their businesses. But this often translates into a number of dispersed initiatives instead of a structured and holistic action plan to capture value from the digital market.”
According to the study:
- 86 percent of institutions include digital as part of their strategy, and 63 percent have established a “chief digital officer”—but only 37 percent have allocated budget specifically for digital transformation.
- Firms have built online and mobile presence for engaging with clients via social media, but C-level executives participate in these initiatives at only 39 percent of institutions.
- 81 percent of firms highlight their work with start-ups and universities on digital topics, but fewer than 60 percent have open innovation initiatives or use digital technologies in their product development.
Accenture's European Financial Services Digital Readiness Report is available for download here.