How ING uses culture to develop innovative products

ING Group released its quarterly earnings this week, beating analyst consensus figures by 40 percent. The Dutch bank attributes the increase in profits to the success of its customer-first strategy, which puts a strong emphasis on innovation. This strategy, the bank claims, helped it acquire about 650,000 new retail customers in the first half of 2016. The bank’s core lending grew by EUR 14.8 billion in the second quarter. ING recently launched a slew of digital money management products. The bank added a forecasting feature to its mobile banking app in the Netherlands, which enables users to gain more control over their finances. ING in Spain launched a digital financial advisor called My Money Coach that helps customers to manage their current and future personal finances. And similarly, in France, the bank launched Coach Epargne, or Savings Coach. In addition, ING joined forces with a Belgian bank to launch an integrated mobile payments and loyalty platform. This solution merges the loyalty platforms of both banks, with ING's Payconiq app. Payconiq was developed by bank employees in its accelerator. It's symbolic of how structural and cultural changes can have bottom line effects. About 2 years ago, ING appointed a Chief Innovation Officer that reports directly to the CEO. The Chief Innovation Office, with a team, resources, and responsibilities, was given the mandate to be a facilitator of innovation and transformation within the bank. Words like agile and lean, a staple in Silicon Valley vocabulary, are now part of the bank’s handbook. One of the major changes is project-based teamwork, which acts as a catalyst for breaking organizational silos, explained Diederik Heinink, from ING’s corporate communications office. Based on an identified customer need, a group of the most relevant people from various departments are gathered together and tasked with developing solutions. Doing things this way, the bank hopes, will ensure shorter time-to-market and more customer-centric offerings. "It is very much about collaboration, sharing, and openness," Heinink said. "We want to tap into the talent of people we have in house." Once a year, the bank hosts an innovation bootcamp. The competition allows anyone of its 50,000 employees a chance to submit product ideas. The top 10 submissions then move on to compete against one another.  The top 3 ideas are incubated alongside three fintech startups in the bank’s accelerator. Last year, about 1200 ideas were submitted by bank employees. Payconiq, the bank's mobile payments platform, was developed in this manner. The push for innovation is part of the bank's Think Forward strategy, which was crafted to offer better solutions to changing customer demand, mostly around speed, user experience and mobility. The bank focuses on empowering customers to take better control of their financial lives through the use of the bank’s products, Among the core areas the bank focuses on are payments, lending, robo advice, money management, working capital solutions, and financial markets. Recently, ING started cooperating with Kabbage and funding loans on the platform. Currently, the bank is working with about 45 fintech startups, according to Heinink. "We can learn from the startups' agility, entrepreneurship, and know how," he said. "They can tap into our strong brand and 35 million customers." Banks are increasingly aware that they need to collaborate with fintech startups in order to win over customers, who are less and less loyal to one brand. As customer habits change, many banks are charting their own courses of innovation, finding the right balance between homegrown innovation and partnerships.