Financial institution finds a new direction

A major Finnish financial institution had successfully executed its older strategy only to find that its operating environment had changed. For help setting a new course, company executives called August.

Challenge

The leader of a major Finnish financial institution realized his company needed a new strategy. Much of the last plan had been executed, but with changes in the market structure and a major regulatory initiative in the horizon, the firm now lacked a clear path forward. The executive knew he needed a plan that took into account a variety of external contingencies. So he called August.

Brave the Future

Instead of taking a traditional top-down approach to developing the strategy, we used a scenario-based approach developed by our Executive Advisor Timo Vuori.

First, we reached out to many of the company’s management and employees. Through online tools and traditional workshops, we posed hundreds of questions intended to bring out a holistic understanding of what the company might need do differently in the future.

From this raw material, we worked with representatives from the company to formulate four possible strategic scenarios i.e. alternative directions for the company.

Once we set out the alternatives, we set up four client teams and asked each to further develop one of the scenarios. In a series of workshops, the teams discussed what each option would mean for the company’s structure and processes as well as its future growth and competitiveness. To support their efforts, we developed extensive fact-packs on internal and external trends and modeled their impact on a given strategic scenario.

Once we finished the workshops, it became clear to us and to the client that regardless of the alternative chosen, the company’s core business was under threat. A change in strategic direction was not only desirable. At this point, it was essential.

Impact

The participants from the client team said the evaluation of the four alternative directions was an eye-opening experience. Learning impact was reinforced by client teams’ own work to describe and evaluate each scenario. In the end, the client chose a strategic direction that took the most promising and thoughtful elements from each of our four options, and began to reinvent itself for a new decade. Today, the financial institution has begun a journey bound for points beyond its traditional core business, but from a very good starting point: a deep, collective understanding of why a new destination is necessary and what the right path to take to get there should be