Standout Banks for Innovation

“Wells Fargo led the pack of banks in innovation in 2021, with an absolute innovation score of 68.3. The biggest driver of this number was the extremely high rate at which the bank abandoned prior patent applications -- a metric that gives insight into whether a company has a culture of letting go what isn't working and focusing on what's next. Wells Fargo also had a high rate of new patent applications last year.

 

This combination of shedding the old and embracing the new comes as the company is moving beyond older technologies, such as mobile wallet (where you can digitally store and access credit and debit cards on your smartphone) to concentrate on fresh ways to use blockchain and artificial intelligence.

 

"The innovation strategy is layered over the business strategy," says Chad Bement, lead counsel in Wells Fargo's intellectual property department.

 

So far, this hasn't translated into more delighted customers. Wells Fargo's customer satisfaction score was just 39.8 in 2021.

 

"I think Wells is at a pivot point," says Bob Neuhaus, executive managing director of financial services at JD Power, which supplies the Drucker Institute with customer satisfaction data. In early 2021, he notes, Wells Fargo brought in an experienced executive team from Bank of America Corp. to oversee the revamping of its consumer-facing digital platform.

Mr. White of Clarivate doesn't expect any of this to slow down. U.S. banks, he says, are pouring resources into technology that can support security and authentication, speech recognition, and app-based transactions. All the while, he adds, they are keeping a close eye on a host of nontraditional rivals -- whether it's PayPal Holdings Inc. or a Chinese company such as Alibaba Group Holding Ltd. -- as well as potential disrupters now on the horizon.

The next frontier, Mr. White says, will be the metaverse. "That is a real vector of innovation," he says, adding that technology used to purchase tokens as part of a fantasy game today could well be the foundation for money in the bank tomorrow." [1]

1. C-Suite Strategies --- Management Top 250: Standout Banks for Innovation --- Overall, financial services don't score particularly well. But there are pockets of excellence.
Wartzman, Rick; Tang, Kelly. Wall Street Journal, Eastern edition; New York, N.Y. [New York, N.Y]. 22 Feb 2022: R.11