Ashok Vaswani on how to make innovation culture "stick"
“Culture is more important than spend,” says Ashok Vaswani, CEO of Barclays UK. “Ultimately, people who are excited by technology want permission to do things. If you can give them that permission, that’s when exciting things happen. And who has that authority? It has to start at the top. The role of senior management is to make sure that folks like me don’t hold them up or create trouble for them. My job is to make sure that people get out of the way.”
Vaswani was speaking at the LeadersIn Tech summit, a flagship two-day conference, part of London Tech Week. In a panel discussion about ‘Innovation mentality: bringing start-up culture to big business’, Vaswani joined senior industry experts and tech investors in considering the difficulties of innovating internally, the importance of talent, and how to make “innovation stick.”
The summit was held in the London headquarters of Google and was chaired by Jacqueline de Rojas, the President of TechUK. Asked whether it was possible to innovate from inside a big business, Vaswani said: “I hope we are proof of that. We’ve been on the journey for a good few years, and I think we can keep the innovation pipeline going.”
We’ve created a beta version of our mobile banking app – Launchpad – and we say to fintech use our APIs and design standards and develop whatever you think is a good idea, launch it on Launchpad, and if our customers love it then we love it too.
The challenges of absorbing external innovators and moving ideas from start-up to scale-up were considered, but some of Barclays’ strategies, where incubation has been more prevalent than acquisition, were also outlined.
Vaswani said: "Let’s say you see a fintech that’s doing a fabulous job, and you go out and acquire that company. Ultimately, whatever that fintech is doing you’ve got to bolt them on to your back-end systems. Also, you’ve got to amend the design to fit in with your front-end design.
"So then you ask the question: ‘What am I buying here? Am I buying the idea, which I’ve already seen? Or the design or the ability to plug in to the back-end, which I’m going to have to change anyway?’."
He continued: “That makes the acquisition of small fintechs very hard. So we’ve created a beta version of our mobile banking app – Launchpad – and we invite fintechs to use our APIs and design standards and develop ideas, launch them on Launchpad, and if our customers love them, then we love them too. It’s much easier to then take things from Launchpad into our main mobile banking app.”
However, innovation strategies were not “exclusively outside or inside”, said Vaswani: “It’s a mix of both. We’ve adopted processes with RISE and Eagle Labs that allow us to bring fintechs to those platforms and then bring the ideas in-house. Simultaneously, we do a lot in-house. What we’re working on is a process where you can take ideas, bring them in, and then take them to market.”
Vaswani was clear that the meeting of small, innovative fintechs and legacy giants like Barclays can demand changes of culture on both sides. On one hand, he said, “there’s a price to be paid for having 24 million customers and having to scale for that”, but from inside Barclays his view was that “senior managers have to start articulating the art of the possible or this is not the place for them. They’re hard decisions, but if you don’t make them, you’re out of business.”
The conclusion of the panel discussion was that innovation takes hold when convenience overtakes risk. Giving an example, Vaswani noted: “Barclays was the first bank to start thinking about contactless. We invested in contactless from 2006 to 2013, and during that time contactless didn’t get masses of traction.. We continued to invest, issuing cards with contactless capabilities.
What really changed contactless was Transport for London (TfL).” At that point, Vaswani said, both the new technology and a new way of living became established: “With many technologies, you have to bear with them for a while. In May, 78 million contactless transactions were made by our customers.” He added that Barclays is currently experimenting with Contactless Cash – withdrawing cash from machines with the touch of your smartphone.
With the example of public sector TfL, the roles of legislators and governments were considered (“this is the sort of thing that puts countries into leadership positions”). Commenting on political events in a wider story of global development and tech and digital competition from China to India to the United States, Vaswani said: “We can’t afford to have bumps in the landscape derail us. We’ve just got to make sure this is a place that encourages the best to come.”