Is this the end of Banks!?

12

October

2018

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The digitization of businesses brings threats and opportunities. The threats are mostly felt by established companies. Established companies are threaten by new entrants with a digital business model with great content, customer experience and digital platform. The importance of digital business models is rapidly increasing. There is a trend of digital natives consumers nowadays demand a brilliant digital experience while interacting with businesses (Weill and Woerner, 2013). These trends require businesses to transform digitally. I think that just like how Facebook, Apple and Uber disrupted markets by creating a platform with complementary services, banks should also provide complementary services next to their own products and services. If they don’t they will continue losing customers to companies that do incorporate a digitalized shared platform like Apple and Google (Weill and Woerner, 2015).

A good example of a bank who started investing massively in fintech, providing financial services by using software and modern technology, is the French bank BNP Paribas. Its three year transformation plan is yet the most ambitious and costly investment made public in the financial services industry. Their 3 billion investment will go into tech labs, new internally developed apps and platforms. This to enable customers to access its services online, efficiently use its data and become more adaptable to change. They are expecting to generate 3.4 billion euros in saving in 2020 and after that 2.7 billion euros in annual savings (Williams-Grut, 2017).

The results show that the net income in comparison to last year’s decreased by 0.1%, however this is pretty low when we look at the major investment they made in 2017. In addition to this the net income has increased by 53% in comparison to the previous quarter this year. This shows that that the bank is on track for its 2020 objective (Amaro, 2018). This shows that it is not the end of banks yet, but major investments are required to transform existing operations and fend of disrupters. However challenges remain, especially in the corporate and investment banking. These are the areas that require more assessment and critical evidence-based decision-making.

Author: 431453mt

Sources:

Amaro, S. (2018). BNP Paribas profit beats expectations despite investment bank weakness. Accessed on 12 oktober 2018, from https://www.cnbc.com/2018/08/01/bnp-paribas-q2-2018.html

Weill, P., & Woerner, S. L. 2013. Optimizing your digital business model. MIT Sloan Management Review, 54(3), 71

Weill, P., & Woerner, S. L. 2015. Thriving in an increasingly digital ecosystem. MIT Sloan Management Review, 56(4), 27

Williams-Grut, O. 2017. French bank BNP Paribas is spending €3 billion to ‘build the bank of tomorrow’. Accessed on 12 oktober 2018, from https://www.businessinsider.nl/bnp-paribas-2016-results-3bn-digital-transformation-plan-profits-up-2017-2/?international=true&r=UK

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Will 3D food printing become as popular as the microwave?

7

October

2018

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Probably the answer is no (is it?), but there are some aspects to 3D food printing that will likely cause this technology to disrupt the food industry.

3D printing is already commonly used to create simple objects. For some nice examples, take a look at https://bit.ly/2qnfpij. However when it comes to 3D food printing, the technology faces some barriers. Printing chocolate or dough is probably not very complex, but some types of food will require a longer and complex process. The most common designs require successive layers of ingredient to cool, leading to long wait times (Straw, 2015). In addition achieving the right texture and flavour for e.g. meat is a lot harder. Moreover, people are very conservative when it comes to food and might not readily accept these “printed meals”.

Nevertheless the technology is very promising. Firstly, creativity is boosted. Think about beautiful shapes or even replicates of pictures that can be made. Secondly, food sustainability is addressed. Alternative but unpleasant ingredients (e.g. algae, duckweed, grass, mealworm) could be used. If these ingredients are mixed in the shape of a cookie, people might actually eat it. Moreover, it is claimed that it would reduce food waste. For example the cartridges could be made environmentally friendly. Thirdly, nutritional customizability is possible which provides solutions for healthy and personalized dieting by allowing users to choose the amounts of calcium, protein, omega-3, and carbohydrates in their meals.

CEO of byFlow, a Dutch company selling and producing 3D Food Printers, announced they want to investigate more into healthier capsules with less or no sugar and no preservatives and into fresh vegetables and fruits. As such, 3D printing could also reinforce a healthy lifestyle. Especially for families who find cooking too time-consuming.

Considering these drawbacks and benefits, what part of the food industry would face the biggest threat by this technology? Grocery shops, bakeries and patisseries, food catering (e.g. for nursing homes), high-end or average restaurants or maybe fast-food chains and budget-friendly food chains?

Sources:

https://disruptionhub.com/disrupted-food-why-3d-printed-food-is-the-future-of-food/

https://blogthinkbig.com/3d-printing-food

https://www.foodingredientsfirst.com/news/3d-food-printing-verstegen-becomes-the-worlds-first-supplier-of-fillings.html

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The end of AirBnB?

22

October

2016

5/5 (4)

The founders of AirBnB have been in a nice and educational rollercoaster: starting with an air mattress in the living room to an international platform with accommodation in 34,000 cities in 191 countries.

Their strategy was different from that of other disruptive organizations. Where a company like Uber heartlessly attacked the taxi market from day one, for example totally ignoring the current market and its employees, AirBnB chose a seemingly social way. To the outside world in recent years it seems to be a great success story that sounds like a optimistic entrepreneurs lecture.

But AirBnB is in trouble. The representatives of the State of New York filed a law that threatens the business model of AirBnb in New York. In the end of next week, Governor Cuomo decides whether to sign or veto the law. In 2010, New York passed a law which prohibits leasing apartment complexes in Manhattan for a period shorter than 30 days. But this is the core activity of Airbnb. The law is therefore not met. Therefore they have proposed an even stricter law: who rents his apartment through Airbnb for short term, will be fined with $ 7,500.

The big success of AirBnB, seems to destroy the company and forces AirBnB to make choices. Most important: short-term exponential growth or long-term sustainable existence. Growth is a conscious choice, but city authorities are not entirely happy with that growth. On the one hand they appreciate the new flow of tourists, but on the other hand they are responsible for defending the interests of the city and its inhabitants.

I think it is really important to think about the interests of the citizens, but cities need to give new developments like AirBnB a place in the current policy. For example policy about the affordability of houses, the occurrence of inconvenience and to make sure the business is fair. Because this kind of companies are the future.

The municipality of Amsterdam conceived as examples three very simple rules: 1. Do not exceed sixty days per year; 2. No more than four people at a time; 3. Not in social housing. Is this verifiable and will new regulations focused on disruptive companies safe AirBnB?

Interesting is to look at the website InsideAirBnB.com, which creates maps of the data from AirBnB.
When we take a look of the map of Amsterdam (sorry it’s my hometown and the site doesn’t contain a map of Rotterdam) we see that a solution for this conflict of interests is needed!

 

airbnbairbnb2

http://insideairbnb.com/amsterdam/

https://www.nrc.nl/nieuws/2016/10/20/new-york-bindt-strijd-aan-met-airbnb-4914291-a1527622https://
www.nrc.nl/nieuws/2016/08/29/airbnb-moet-zelf-de-regels-handhaven-4048140-a1518490https://
www.nrc.nl/nieuws/2016/10/20/new-york-vs-airbnb-strijd-om-toekomst-van-verhuursite-4902724-a1527496

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How disruptive is Tesla?

3

October

2016

5/5 (2)

Some people think that Tesla is disruptive. In 2014 there even was a shareholder of Tesla that suggested that the CEO of Tesla, Elon Musk, invented a new form of disruption. In this new form of disruption products start at the high-end (expensive) and move down (become cheaper over time). Tesla started producing electric cars which cost more then $100.000. Later , in 2015, Tesla started producing cars which cost approximately $70.000 and in 2017 Tesla plans to launch a new car that will only cost $35.000.

Clayton Christensen, a Harvard business School professor and disruptive innovation expert, and his team conducted a deep study of Tesla to determine whether the firm really is pioneering this new form of top-down disruption. To investigate the disruption of Tesla, Clayton and his team created 5 main questions:

  1. Does the product either target overserved customers (by offering lower performance at a lower price) or create a new market (by targeting customers who couldn’t use or afford the existing product)?
  2. Does it create “asymmetric motivation,” meaning that while the disrupter is motivated to enter higher performance segments over time, existing players aren’t motivated to fight it?
  3. Can it improve performance fast enough to keep pace with customers’ expectations while retaining its low cost structure?
  4. Does it create new value networks, including sales channels?
  5. Does it disrupt all incumbents, or can an existing player exploit the opportunity?

As Clayton and his team worked out all the answers to the questions it became clear that Tesla is not a disrupter, but a a classic “sustaining innovation”: a product that, according to Christensen’s definition, offers incrementally better performance at a higher price.

On the other hand, there are people who think that Clayton Christensen’s theories are outdated. These people say that with the way Tesla works and looking at what Tesla offers for what price, the company is being disruptive. Competitors already have a hard time trying to keep up with Tesla and according to Elon Musk this gap will become bigger and bigger. Can we call this disruptive, or not?

Sources:

  • http://www.claytonchristensen.com/
  • https://hbr.org/2015/05/teslas-not-as-disruptive-as-you-might-think
  • http://fortune.com/2015/12/17/apple-tesla-uber-not-disruptive/
  • https://www.technologyreview.com/s/539081/how-disruptive-is-tesla-really/
  • http://www.huffingtonpost.com/seyi-fabode/why-tesla-is-not-disrupti_b_8625508.html
  • http://www.asymco.com/2015/05/28/is-tesla-disruptive/
  • https://www.washingtonpost.com/news/innovations/wp/2015/11/23/what-the-legendary-clayton-christensen-gets-wrong-about-uber-tesla-and-disruptive-innovation/
  • https://electrek.co/2016/06/07/tesla-tsla-elon-musk-years-ahead-of-the-competition-ron-baron/

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