by GSBC President & CEO Michael Stevens
Rising third-year students at GSBC have the opportunity to collaborate with a group of peers on technology, demographic and social issues that may impact the future of community banks. Together, the students form a “Signals Group.” Signals are real developments that are occurring but are not yet widely recognized as impactful to community banks. The students research and brainstorm emerging changes and innovations, creative solutions and opportunities these signals may present to community banks.
The foundation for this work is rooted in the Drivers of Change, identified by GSBC’s Board of Trustees in 2023. The Drivers of Change analysis can be found here.
Signals Topics Explored by GSBC Students
Technological Innovations in Banking
- Blockchain and the Potential Effects on Title Insurance
- Digital Assets and Tokenization
- Generative AI in Banking*
- Human-Machine Collaboration: People and Culture*
- Instant Payments
- Leveraging Data Analytics in Banking*
- Open Banking
Strategic Partnerships and Industry Dynamics
- FinTech Partnerships
- M&A Between Banks and Credit Unions
- Staying Competitive in the New Environment
Cultural and Demographic Shifts
- Aging Demographics
- The Longevity Economy and Risks to the Great Wealth Transfer*
- Remote Work and the Impact on Culture
Reflecting on the Signals work over the last four years from our alumni and students, important themes have emerged to help guide banks as they contemplate the future.
*More information on this topic is outlined in the graphic below.
Key Insights from GSBC Signals Groups
People and Culture Always Matter
There is no shortage of solutions for a bank to consider when building its technology stack. The foundational belief of our students is that technology should enhance the relationship-based business model. They fundamentally believe this is the greatest value of a community bank.
To achieve success, innovation needs to be part of the corporate culture. This sets the tone for the importance of innovation within the organization. Organizations must include a variety of staff in the brainstorming, research, planning and adoption of technology solutions. An inclusive process leads to better customer solutions and fosters organizational buy-in during implementation and training. This approach leverages the best of community banking: people and human connection.
Learn the Unthinkable
An organization with a culture of innovation must have the willingness and processes to learn. Early stories about artificial intelligence seemed far removed from the business of banking. Some of these stories were even frightening. However, organizations must not let that stop conversations and learning.
Just because an idea feels uncomfortable today does not mean it should be dismissed forever. Organizations have opportunities to continue learning and observing. There is also tremendous value in brainstorming what could be possible.
There is a very fine line between crazy and genius. Give ideas the opportunity to mature.
Opportunities Carry Risk
Risk is always present. The role of a bank leader is to manage risk. New technologies, products, services, and even cultural shifts bring risks. Organizations should avoid allowing potential risks to halt education and evaluation of opportunities. Identify the risks and determine if and how they can be managed. Leaders should also recognize that risk mitigation techniques may evolve over time, creating future opportunities.
Imagining Your Future Self
Participants in the GSBC Signals Group engage in a visioning exercise over a ten-day period. On a randomly selected day, participants are asked to think about a banking activity conducted on that day and how it may be different in 10 years, given the signals they have studied together. They share their observations and ideas with others, contributing additional insights.
To start this exercise, participants are asked to create a vision of who they will be in 10 years, both personally and professionally.
This constructive exercise generates creative and realistic ideas for people to build upon. The most important lesson from this exercise is the positive vision these community bank leaders have of themselves and their organizations. Participants see themselves as making significant contributions to their banks and communities. They envision an industry that uses technology and new products to strengthen the relationship-based business model at the core of community banking. They foresee bankers continuing to uphold the public trust as a vital community resource.
A Resilient Industry with a Bright Future
The economy can be challenging, weather events can pose sudden and catastrophic losses, and regulatory burdens can be relentless, yet there is a positive vision of an industry that has demonstrated resilience since the founding of the country.
Understanding the Drivers of Change impacting the industry and fostering a process to identify and learn about new technologies and cultural shifts will enable a bank to better discern its desired future and the path to get there.
