Staid bankers are embracing the latest collaborative tools to drive innovation. The Society for Worldwide Interbank Financial Telecommunications (SWIFT), a global organization that handles an average of 15 million standardized financial transactions such as wire transfers every day for more than 8,000 banks, is spearheading a drive to “inject an innovation culture not only at SWIFT but the financial community as a whole,” by collaborating on new e-banking solutions and working more closely with start-ups, says Kosta Peric, head of innovation at SWIFT.
Since 1973, Brussels-based SWIFT has provided a shared worldwide data processing and communication link for the world’s banks, using a common language for international financial transactions. Its main function is to be a carrier of messages. It does not hold funds, manage accounts on behalf of customers, or store financial information on an ongoing basis. That said, SWIFT is increasingly taking on the role of a catalyst to bring the financial community together to work collaboratively on market practice, standards, and issues of mutual interest.
With that goal in mind, Peric is behind an online marketplace called Innotribe that went live on Feb. 11 and aims to leverage the collective creativity of the finance sector. The idea is not only to deliver on the traditional mission of lowering costs, reducing operational risk, and eliminating inefficiencies, but also to get creative about taking the sector into entirely new directions.
Innotribe is clearly not your father’s banking communications platform. Bankers who wish to submit their ideas for new products, services, or business processes (or enhancements to existing ones) can do so by signing in with a Facebook, Google, or Twitter account. They are greeted with the message “Remember, everyone is an innovator; and a crazy idea that works is not so crazy at all. Share with us your ideas, be they matter of fact or wildly aspirational.”
The site uses a cloud-based software application from Brightidea.com to collect, track, and manage ideas. It also allows those participating in the project to volunteer to work on particular projects and vote on which ideas should be considered for investment and developed to the proof-of-concept phase.
"What we are doing is enabling collaborative innovation," says Peric. That includes embracing crowdsourcing and mash-ups—technology approaches more often associated with start-ups targeting the under-30 crowd than staid bankers.
Peric and his five-person innovation team started out two-and-a-half years ago as a research and development unit. After little more than a year they began encouraging others inside SWIFT to collaborate on new projects. Teams of SWIFT employees were asked to solve particular problems. They were given one month to work on their ideas during their free time, such as lunch or coffee breaks. When the deadline arrived, the proposed solutions were passed to Peric's team. A jury of executives voted on which ideas they liked best. The winning ideas were then implemented on the company's time.
Based on the success of the in-house collaboration, SWIFT decided to involve the wider banking community. During its annual Sibos conference in Hong Kong last September some 6,000 delegates were asked to generate ideas in three different areas—crowdsourcing, mash-ups, and cloud computing, which allows the shifting of computing tasks and storage from local desktop PCs and company servers to remote systems across the Internet. About 500 people showed up to learn more. A core team of 40 delegates met for two hours a day during four days to flesh out concepts and develop pitches that were then delivered publicly to a jury.
One of the winning ideas is called "eMe," a cloud-based project that would allow banking customers to establish a digital lockbox with sensitive personal or business information, such as credit card numbers. Instead of having to type in the information each time a consumer or business makes a purchase, a code could be given to the digital lockbox. Click here to watch a video of the original eMe pitch. Another winning idea, with the working title "eBiz," involves creating a central electronic point where information could be retrieved by businesses about the status of shipped goods.
SWIFT is exploring the idea of co-investing in the development of the "eMe" and "eBiz" projects alongside some of the banks that are its clients. Working with startups is the next step. "We are not yet working with startups but we want to engage with them," says Peric. "It is very much in line with our open collaboration concept—there are lots of ideas out there that are relevant to the financial community so we want to make our SWIFT brand known in this context."
To help spread the word SWIFT has become a sponsor of a global competition called Innovate! 2010 launched by the Guidewire Group, a market intelligence and advisory firm, to identify and accelerate the world's 100 top technology, media, and telecommunications startups. (Click here to learn more about Innovate! 2010). Peric says he hopes to give at least one of the winning startups from the Innovate!2010 contest some exposure at SWIFT's next Sibos event, which will take place this October in Amsterdam.
Start-ups with technologies relevant to the financial industry should pitch directly to SWIFT or through the Innotribe Web site. "We guarantee the request will be acted upon," Peric says.
Guest blog post from Jennifer L. Schenker.