Once focused on a generalized core group of services and customers, banks today are faced with the dual challenges of serving diverse stakeholder needs while selecting which areas of the industry and company value chains they want to specialize in. The difficult choices that banks must make as to which markets to enter and which customers to serve must include a critical review of the products and services that will enable the bank to avoid erosion of its profit margins. Maturing industries generally look to innovation to prevent commoditization. Unfortunately, however, the banking industry is steeped in tradition and slow to adopt true customer innovation. Consider that customers are enticed to open bank accounts that, although advertised as free, often include hidden fees, and customers sometimes suffer poor customer service at the hands of under-trained staff. The much touted customer innovations, such as in-branch cafés, wireless access and khaki-clad service representatives, have done little to meaningfully improve the banking experience for most customers. From a performance perspective, banks have turned almost exclusively to acquisitions for growth. The resulting lack of attention on organic initiatives has prevented banks from creating high-performance organizations capable of delivering value in the face of cyclical economic forces. Furthermore, the inability of banks to satisfy customers with innovative products and services has squeezed profit margins. Incremental change has become the norm for this industry, but more is needed. To read the complete study, download the PDF file at the top of this page. | 
