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Patrick Dixon Chairman Global Change Ltd
Accelerate Your Future
FutureTrendsImpactonNordea
StrategicOpportuni6es60secondpitches
-Asifyouaretheboardofthebankwithanexternaladvisor-
ALLBIGTRENDSARERELATED
WhatwillNordea(andyourcompe6tors)looklikein2020?
ONEWORDwilldrivethe
future
EU20,000Challenge“4wordphraseisbasis
ofallmarke6ng,mo6va6on,change
managementandleadership”
to waste on things you do not believe in
LifeistooShort
Whocaresaboutthenewstrategy?
teamsandcustomersneedtofeelitmaUers
Whyshouldtheygrow?
“Greatleadershipistheabilitytoengageand
mo6vatepeopletoreachoutforourvisionandtheabilitytocreatetherightteamtomakeithappen.”
AllleadershipcomesfromVISIONofabeUerfuture
What customers really want
Most debates about future strategy are about timing
and focus
What if global recovery / mobile payments / retail spending / use of cash
bank regulation / inflation / Russia / life expectancy, the EU and rise of Asian markets all change faster than expected?
• Typetoentertext
Benchmarking is toxic to risk management
• Typetoentertext
LawsuitswillbefarlargerthanFines
• ClicktoeditMastertextstyles
31
• ClicktoeditMastertextstyles
32
Strategies often overtaken by events World can change faster than you can hold a board meeting
Agility requires
Simplicity
Yet many trends changing more
slowly than people think
Cash growing - bank branches continue -
music, fashions, food - homes look the same,
where are all the robots?
ONEWORDwilldrivethe
future
WGP1980-2013(%,constantprices)
WGP2005-2014(%,constantprices)
2% inflation target likely to be discarded
VietnamGDP1985-2011
$3.4trillion
$3.4trillionownedbyChinesesovereignwealthfund
$2.4trillion
Reserves
ONEWORDwilldrivethe
future
The future is aboutEMOTION
“Eachcustomermustknowtheycantrustouradviceandthatwewillbetherewhentheyneedusmost”
Digital Control
TimeSavers
57
“Greatcustomerexperiences”
MysteryShopping
!?!
Bank Customer / Client :
Simple, elegant solutions to complex problems
Anticipate, instinct, smart Thought-leadership, common
sense, reliable advice Superb backup in crisis
>40%WDPby2015� IMF - adjusted for Purchasing Power Parity
300 million move to cities in China and 475 million to cities in Africa by 2030
1 billion over 60 year olds in 10 years
Europe Dying 4 couples to produce single great-grand child
!69
Science,technologyengineering,maths
MostSTEMgraduatesinemergingmarkets
ChinaandIndiadominate
STEMdegreesincludingpost-graduate/PhDs
Can we stop ageing ?
•Pigsteethgrowninsiderats•Micegrownewteethfromnervecells/gum
Grow New Teeth
Repair Heart / Brain with stem cells
We can print layers of living cells....
• After 20 years - 80% alive v 50% on normal calories • Less cancer, diabetes, heart disease, strokes, brain decay
77
Monkeys on diet live longer
Slowornoageinginanimals->pensions Japanwomengain15minutesoflifeexpectancyeveryhour
• Rockfish, Turtles, some Whales
• No signs of getting old
lPeople like to belong lSense of identity lCommunity lFamily lPersonal advisor
“Relationship Banking” 2.3 million customer meetings a year
with over 10 million customers
!81
“Genderdiversityiskeylevertorealiseleadershippoten6al”
85%ofleadersoflargestUScorpora6onssaydiversityis
keytoinnova6on
Forbesstudy
1trillionpagesamonth
Would recommend you to a friend ?
1trillionpagesamonth
"Perfection!, Wonderful hotel. Good value, beautiful views.“
Telford UK, May 20, 2012This was the most beautiful hotel. Clean, friendly and good value.
“Worst hotel I have ever been in. Should be closed down.“
Paris April, 2012
NEVER stay in this terrible place. Rats, insects, dirty. Many guests got sick.
90% all global data
generated in last 2 years
BigDataandLiUleData
!89
“Universal Banking” Scale - Innovation Speed
Is the bank large enough for the future ? Eat or be Eaten or more Strategic Mergers
Risks from
post-merger paralysis
Almost all bank IT
spend is on legacy, compliance, security
impossible to keep pace with customers
Why “old” outsourcing story in India nearly over
NearshoringBoom
We are only in first hour of first day of
eCommerce
e-commercehits$1.5trillion201412%allUKretail
Mobile More than a
Channel
Most online sales will be MOBILE
Loca6onMarke6ng
CUSTOMERCHOICE 200millionpaymentsglobally
• Kenya-17mcustomers• $9bnpa->33%GDP• Tanzania9mpeople• 35na6onlinksviaHomeSendHub
104
1.7bnphoneusersareunbanked
Payments to home by migrants
are driving Innovation
$550bn in 2012 - 214m transfers150m immigrants globallyWorld’s poorest 48 nations = double FDI value33% of Liberia economy$55bn remittances by mobile in 2016
GlobalRemiUances
ValueofEuronotes2002-2013
incircula6on
CASHBOOMinEU
108
• In UK alone.... • Transactions >EU600 billion pa • Credit card debt >EU60bn • Average card interest rate 16% • 2% commissions worth >£EU12bn
Payments Doorway
Free mobile devicescalls / web / TV / games / payHigher income model
201020132015
TelcoBanks
BeUerBiometrics
Time at bank teller cut from 4 to 1 minute
Internet of Things
• 90%MicrosojR&D
CLOUD
Overwhelming CYBERATTACKS
from States or criminals
InternetofThings-BigData-Cloud180bnspamemailsaday
600mnewviruses,malware,trojansayear>220mpeople’sdetailslostinsingleaUack70%largecorpora6onshavebeenhacked
100,000aUacksanhouronUSNavyParalysisofEstoniagovernmentin2007
WorriesaboutUS,Russia,Chinapenetra6on
Regulatory Swings
eg Capital Adequacy / ROI
Public pressure v Reality
$40 Trillion Green Tech Boom driven by oil price, cost cuts, green activism
Shale gas 33% US supplies
3.3m US jobs $468bn pa + more oil
produced than Saudi by 2020
200 years global supply Up from 60 years in 5 years
Boom
Bust
5coalplantsreplacewithgas=9000megawaEswindCoalpricesfall=morecoalburntinVietnamandChina 57coalplantsclosedinUSin2012
120,000 terawatts of sunlight /day 7,000 times total power useQUEBECfromARIZONAMOSCOWfromSAHARA
Solarcellgenera6onparity
SolarCells$/waU1990-2015
subsidies
PriceParity
120,000 terawatts of sunlight /day 7,000 times total global power use Power Moscow from Libyan Desert
“40% EU power = wind by 2050” Surplus wind to hydrogen - to methane ?
GermanyPowerSurplus
• InJune2013• Electricitypricesbecamenega6ve• -minusEU150/MWhr!!
•Rapid growth HVDC Super Grids
• 500,000 S Korea jobs - $200bn Smart Grid Project
•China planning to power Moscow
�30 million acres lost
�EU 5% gasoline and diesel from food
25% of 2010 US grain à fuel30% US grain burnt in cars
Tdo things you believe in sell things you believe in
Beyond Compliance
Perfect compliance will keep bankers out of prison but cannot protect brand,
because public expectations change rapidly - with severe judgment on those who justify past “unethical” behaviour on grounds that it was 100% compliant.
Truth about Retail Funds�Next miss-selling scandal? �Most actively managed funds fail to beat tracker funds,
when all charges deducted �Most fund managers I have surveyed (total > $1 trillion
under management) are reluctant to invest own money in own retail funds unless they are required to, and reluctant to recommend own funds to family / friends
� “50% of us sell funds of funds but only 5% of us invest in them”
�Ethical questions since whole purpose of active management is to protect wealth, not erode it (as is most likely outcome under current business models)
All sales based on a promise Purpose of business is to deliver
on the promise Profit is your reward for doing so
Purpose of Business
LessonfromNon-ProfitFounda6ons
Connectwithallthepassionspeoplehaveandtheywillfollowyoutotheendsoftheearth,
promotewhatyoudowithpride,andmayevenbewillingtoworkfor
youfornexttonothing
EU20,000Challenge“4wordphraseisbasis
ofallmarke6ng,mo6va6on,change
managementandleadership”
Build a Better World individual family community world
RESOURCES
>500 videos of Keynotes http://www.youtube.com/pjvdixon
Global Trends Website: http://www.globalchange.com
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