Includes bibliographical references and index.

Forewords xv About the Author xxix Disclaimer xxxi Introduction 1 Part One Foundations of Platform Theory Chapter 1 Platform Essentials on Outcome Economies 15 1.1 Introduction 16 1.2 Platforms and ecosystems 17 1.3 Innovating from output to outcome economies 22 1.4 Linear and non-linear thinking 24 1.5 Platform types 25 1.6 About platforms and innovation theory 27 1.7 Shifting the perception of value 29 1.8 Banks and fintech on outcome economies 31 1.9 Conclusions 33 Takeaways for banks and fintech 34 Chapter 2 The Trust Advantage 35 2.1 Introduction 35 2.2 Elements of platform creation 37 2.2.1 The platform challenge 38 2.2.2 The chicken-or-egg dilemma 39 2.3 Transparency generates trust 42 2.3.1 It’s marketing, stupid! or not? 42 2.3.2 Trust in the middle kingdom 43 2.4 The trust advantage for banks and fintech 44 2.5 Conclusions 47 Takeaways for banks and fintech 48 Chapter 3 Open Innovation and Data 49 3.1 Introduction 49 3.2 Closed and open innovation 51 3.2.1 Attributes of closed and open innovation 52 3.2.2 Open innovation in platform economies 53 3.3 The strategic role of complementors 55 3.4 The monetisation perspective 56 3.5 The monetisation of APIs 58 3.5.1 Free use 59 3.5.2 API consumers pay 59 3.5.3 API consumers get paid 60 3.5.4 Indirect monetisation 60 3.6 The monetisation of user engagement 61 3.6.1 Imposing transaction fees 61 3.6.2 Asking for access fees 61 3.6.3 Tiering enhanced access fees 61 3.6.4 Delivering enhanced curation 62 3.7 The API economy for banks and fintech 62 3.8 Conclusions 65 Takeaways for banks and fintech 66 Chapter 4 Platform Governance Founded on Transparency 67 4.1 Introduction 67 4.2 Power comes with responsibility 68 4.3 Platform monopoly between competition and regulation 71 4.3.1 Intensified regulation 71 4.3.2 Better governance to fight monopoly powers 73 4.4 Negative externalities threaten platform resilience 74 4.5 Governance of openness and curation 76 4.6 The transparency governing principle 78 4.6.1 Transparency about platform management 78 4.6.2 Transparency about platform orchestration 79 4.7 Transparency for banks and fintech 80 4.8 Conclusions 82 Takeaways for banks and fintech 83 Part Two Reinventing Financial Services Chapter 5 The Existential Shift of Bank Business Models 89 5.1 Introduction 89 5.2 The new normal of central banks 91 5.2.1 Lehman Brothers’ default 91 5.2.2 The annihilation of central banks’ systemic put 92 5.2.3 Banks’ Catch-22 95 5.2.4 From product-centricity to human-centricity 98 5.3 About the tension between information and communication 99 5.4 The banking reinvention quadrant 101 5.4.1 The map and the compass 101 5.4.2 The information and communication quotients 103 5.5 Four BRQ business value spaces 104 5.5.1 Traditional Banking 105 5.5.2 Digital Banking 105 5.5.3 Contextual Banking 105 5.5.4 Conscious Banking 106 5.6 Conclusions 107 Takeaways for banks and fintech 108 Chapter 6 Lessons Learned from Fintech Innovation 109 6.1 Introduction 110 6.2 The true meaning of disruption 111 6.2.1 My Robo-advisor was an iPod 113 6.2.2 Sustaining innovation with Contextual and Conscious Banking 117 6.3 Resolving the “pull-push” motivational gap 119 6.3.1 Digital is a pull technology 120 6.3.2 What is happening on Amazon? 121 6.3.3 The offer-driven business of banking 122 6.4 Rebundling on platform economies 123 6.4.1 From client-centricity to human-centricity 124 6.4.2 Banking-as-a-Service and Banking-as-a-Platform 126 6.5 Conclusions 128 Takeaways for banks and fintech 129 Chapter 7 Competitive Factors for the Future of Banks 131 7.1 Introduction 131 7.2 The financial services engine 132 7.3 External factors affecting digital transformations 135 7.3.1 Digital infrastructure 135 7.3.2 Digital society 135 7.3.3 Digital ecosystems 136 7.3.4 Capital at risk 137 7.3.5 Regulation 137 7.4 Internal factors enabling digital transformation 138 7.4.1 Digital leadership, strategy, and culture 138 7.4.2 New business architectures and operating models 139 7.5 Conclusions 140 Takeaways for banks and fintech 141 Part Three Leading Platform Strategies Chapter 8 Contextual Banking 147 8.1 Introduction 147 8.2 Compete with open business architectures 150 8.3 From open banking to open finance 152 8.4 Contextual Banking 156 8.4.1 Removing ex-ante frictions without increasing them ex-post 158 8.5 Bigtech gravity 159 8.5.1 Facebook experience vs. WeChat engagement 160 8.5.2 Amazon’s platform philosophy 161 8.6 Financial services fight back 164 8.6.1 Cloud-native payment providers are also chipping away bank revenues 164 8.6.2 Ping An’s investment philosophy 166 8.6.3 Banking orchestration of non-banking ecosystems 168 8.6.4 The platform of platforms 170 8.7 Conclusions 173 Takeaways for banks and fintech 174 Chapter 9 Foundations of Financial Market Transparency 175 9.1 Introduction 175 9.2 Contextual Banking and architectural resilience 177 9.3 Conscious Banking and financial antifragility 179 9.3.1 Breaking out from mainstream reference theory 179 9.3.2 Opening the reference system to fundamental uncertainty 181 9.4 Empirical evidence to open platforms and reference systems 183 9.5 Conclusions 186 Takeaways for banks and fintech 187 CHAPTER 10 Conscious Banking 189 10.1 Introduction 190 10.2 Micro and macro antifragility across ecosystems 193 10.2.1 Value generation at the micro-level investors’ ecosystem 193 10.2.2 Value generation at the macro-level financial ecosystem 196 10.3 Unlocking hidden value in the ecosystem 197 10.4 Exponential technologies on transparent markets 199 10.4.1 Generating value with transparent AI 199 10.4.2 Opening up the reference system with technology 201 10.4.3 Integrating clients’ emotion with a transparent heuristic 203 10.4.4 Opening the AI envelope to stay radically rational 204 10.5 The scientific shift from reductionism to holism 205 10.5.1 Conscious Banking platforms on the edge of chaos 206 10.5.2 Augmenting the human mind with technology 207 10.6 The core engine of Conscious Banking platforms 208 10.6.1 Value-generating interactions based on cost-benefit analysis 208 10.6.2 Open up the risk management engine to the conscious image of endogenous uncertainty 210 10.7 Conclusions 212 Takeaways for banks and fintech 213 Concluding Remarks 215 Bibliography 219 Index 227

"The world most successful companies (Apple, Amazon, Alibaba) are data-driven platforms. They innovated their business models leveraging digital technology to start a journey from output to outcome economies: businesses don't necessarily trade in the products that deliver certain results (e.g. "selling 100,000 cars in 2022", in which the focus is about discrete sales figures or quantities), but in the results themselves which take the form of user experiences (e.g., "allowing 500,000 people to commute by car", in which the focus is on perceived benefits). Clearly, not all industrial products and services can be easily reinvented inside outcome economies, no matter how powerful they can be. This is particularly true for financial services given the more abstract and regulated nature of their products, as well the psychological characteristics of consumers when accessing them. The Platformisation of Financial Services corresponds to a shift in mindset intended to help banks strengthen and extend the reach of their Open Banking operations. Platform theory, born outside of financial services, will be transposed inside banking and insurance to make digital banking more effective. In this way, the financial services industry will master the necessary shift of focus from output (distribution channels of products) to outcomes (enabling clients to enjoy transparent and value-adding experiences, achieve their goals or fulfil their needs, directly or inside non-banking relationships). This book will guide the financial services industry globally towards new forms of digital transformation that benefit shareholders and stakeholders alike, allowing greater flexibility and convenience at lower digital prices"-- Provided by publisher.

College of Business and Accountancy Bachelor of Science in Accountancy

College of Business and Accountancy Bachelor of Science in Management Accounting

In English