The New Normal
One reason the technology industry is so unique is that it has—or more accurately, successful companies have—developed the art of self-cannibalization. It’s a neat trick, and everyone can learn from it.
As technology consumers, we’ve come to expect that every product will invariably get ‘better-faster-smaller-cheaper.’ For their part, most technology vendors know that if they don’t deliver advances at a lower cost, someone else will. As a result, companies build around a business model that routinely cuts into their own profit margins. It’s counter-intuitive yet vital.
It’s not necessarily a discipline that travels well across industries, although there are exceptions (anyone remember how much flat-screen TVs used to cost?). But elsewhere, the price tag for everything from cars to houses continues to rise. With technology, it almost always goes the other way.
The banking industry seems to be in the process of learning these lessons. At a number of industry events recently, leading lights from the world of financial services have gone public with the need to change some fundamental operating assumptions. At its heart is the vexing question the technology industry has long confronted: Can customers benefit only at the expense of the vendor?
This is the new normal, and everyone needs to change accordingly.
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