Can a large bank be (truly) innovative?

Societe Generale has implemented a tried and tested open innovation strategy to streamline its processes and enhance the range of financial products it offers its customers. Cédric Curtil, Head of Strategy and Innovation for French Retail Banking, describes the different elements of this strategy.

Cédric Curtil, Head of Strategy and Innovation for French Retail Banking

Can we still innovate when we are a bank, founded in 1864, that counts nearly 150,000 employees in more than 75 countries, when we manage over 30 million clients and some €23.6 billion in net banking income? For Societe Generale, the question is, rather, how to continue to innovate, as it has always done since its creation. “A company must know how to adapt to the world in which it operates,” says Cédric Curtil. “With the arrival of new technologies, customers have discovered new experiences, and their expectations have increased. If they are used to ordering on an e-commerce website that delivers its products in record time and offers impeccable customer service, they will look for the same experience when they come to Societe Generale.”

To better meet these new expectations, Societe Generale strives to innovate in three complementary areas. The Group seeks first to understand market developments and to analyse its consumers in order to anticipate their needs; this is why it conducts studies, in particular sociological studies, to remain in touch with its customers and to better understand the prevailing trends in its various sectors of activity.

Next, the Group wants to remain at the cutting edge of technology, for example in the field of cryptosecurity. To this end, it will collaborate with a whole universe of startups that are knowledgeable about the diverse types of technology it aims to use. Finally, it works actively with a number of partners in the field of user design in order to offer its customers an experience that is both seamless and as simplified as possible.

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Innovating to improve the customer experience

To boast of an open innovation approach in the abstract would be out of the question, as such strategies evoke only glossy brochures. “Innovation cannot be detached from reality,” insists Cédric Curtil. “The innovation departments cannot work in isolation. Their actions must be useful to the business line we are trying to improve. This is why, at Societe Generale, the innovation departments collaborate closely with the marketing divisions and operational entities, according to the projects being carried out.” It is no surprise, then, that the majority of Societe Generale’s collaborations with startups focus not on financial services but rather on technologies, communication tools or human resource management.

The Group did, however, acquire Fiducéo in March 2015, via its subsidiary Boursorama. The account and invoice aggregator is now used by customers of Boursorama, Societe Generale and Crédit du Nord. “This operation is proof that we know how to buy a startup without ruining it,” declares Cédric Curtil. “The Fiducéo teams were successfully integrated into the Group, and the product found its place among the functionalities Societe Generale offers its customers.”

Skill sharing between a large group and startups

It is still rare for Societe Generale to directly invest in or, in particular, buy a startup, however. In terms of an open innovation strategy, the Group focuses on supporting promising young companies that it identifies as having high potential. “We have no specific support structure per se, simply because it is not our line of work,” says Cédric Curtil. “But we are partners in a certain number of structures.” The Group nevertheless opened Les Dunes, a technology park located in the Parisian suburb Val-de-Fontenay, in March 2016. This park houses Le Plateau, a more than 100-square metre space dedicated to startups and open innovation.

Extremely proactive in identifying high-potential young companies, the Group meets some 1500 startups per year in all the countries in which it operates. Not all contacts lead to a collaboration, but they do allow the Group to expand the impressive base of innovative companies it can draw from over time as it prepares to develop new projects. “We offer startups our banking expertise,” says Cédric Curtil. “When they need to learn more about a particular banking subject, they look increasingly to us as a partner in skill sharing. In this way, we are positioning ourselves as one of the actors in this innovative ecosystem. We are not here to give them lessons.”

In addition, the Group supports innovative internal projects carried out by its own employees. “We draw on the complementarity between internal and external innovation,” explains Cédric Curtil. The Group launches internal calls for projects in order to encourage talented employees to present their ideas and their suggestions for improvement.

I think, rather, that the market will mature and become increasingly selective. When this phase arrives, Societe Generale will, of course, be working to support strong ideas and sustainable innovations.

Cédric Curtil, Head of Strategy and Innovation for French Retail Banking

Boosting agility

This open innovation strategy is part of a broader ambition. First, to keep the competition at bay, as each banking group has its own strategy in terms of innovation and collaborating with startups. Next, to establish ourselves in the landscape of innovative companies over the long term, regardless of the developments in the sector. “There is a kind of euphoria around innovation, which is to be expected; we are only at the beginning of the cycle,” predicts Cédric Curtil. “But I do not believe in the bursting of a hypothetical bubble; I think, rather, that the market will mature and become increasingly selective. When this phase arrives, Societe Generale will, of course, be working to support strong ideas and sustainable innovations.”

If the Group’s strategy seems tried and tested, there are still a number of areas of improvement. While Societe Generale wants to focus on rapidity – for example, by limiting the number of steps and meetings that a startup must complete with the Group before this leads to a collaboration – technical issues can be a stumbling block in the open innovation process. “Our efforts to work more quickly are sometimes hindered by certain information systems,” admits Cédric Curtil. “But we are developing more and more external APIs to facilitate the testing of new services. This is one of the major points we are working on.” Even after 154 years of existence, a major group can still improve itself…through innovation!

This article is sponsored by Societe Generale and was produced by Maddyness and published the 22/03/2018.

TechWeek 2018

Societe Generale’s annual event dedicated to technological innovation, TechWeek took place from 3 to 5 July, 2018 at the Dunes technology hub in Val-de-Fontenay, in the east of Paris, and the Group’s head offices in La Défense. This year’s theme was applying new technologies to banking activities.

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