In his lecture titled “The Strategies of the Key Players in the Russian Banking Industry and the Role of Banking Strategist”, Roman Zilberman explained who controls the future of a bank, what makes Russia the most digitally advanced country in the field of finance, and what trends appear dominant in the finance industry of today. During the Q&A session, where Roman was assisted by Nadezhda Volodina (HR Director at Otkritie Bank), students learned about Strategy Department and the prospects of the Russian banking industry.
What is Strategy?
The term, indeed, came into use at the time of the Napoleonic Wars, when its meaning was purely military. Now, it has gained a strong foothold in the economic context to denote a process of goal-setting and optimal allocation of scarce resources for successful goal attainment. Strategy implies a kind of an “agreement” between various stakeholders, including clients, society, state, etc. as to the priorities and the development objectives, setting the official line of corporate development.
By the same token, strategists can be defined as specialists who shape the overall understanding of where their company should be heading to, what projects are to be initiated, and what the expenditures and the results will look like. “Underpinning the success of goal attainment is a portfolio of initiatives. This portfolio is normally never large. Otkritie’s one, for example, has ten initiatives that come down mostly to digital channels and operational efficiency and are based on in-depth data analysis,” says Roman.
The state of things in banking
Overall, the financial services sector has been demonstrating a steady tendency towards growth and increase in profitability over the past ten years, although not without temporary downturns. For example, in 2017 the banking sector and its largest banks were placed under a major resolution scheme (Note: bank resolution involves a set of measures to avoid financial instability and bankruptcy. These measures include, among others, recruiting “bailout team”), while in 2020 the banking performance was affected by COVID. In 2021, however, the banking sector reported a record profit of almost RUB 2.5 trillion.
According to Otkritie strategists, banking sector’s further development will continue to be shaped by the following key trends:
1. Fast-paced digitalization. Russia already ranks among the top 10 countries with advanced payment systems, payment apps and digital banking services, and is one of the top three countries offering non-cash payment services.
Switzerland, Great Britain and France are lagging behind Russia in the adoption of Fintech services
“Russia is a unique financial market,” says Roman. “We have our national search engine (Yandex), social network (VK) and messenger (Telegram). Apart from Russia, the competition as strong as this is faced by the Big Tech companies only from China.” Digital banks such as Tinkoff and Tochka are the world’s largest in terms of the number of customers in their segments.
2. Market consolidation. Of more than 1,500 bankers that emerged in the early 2000s, approximately 300 have survived, and this trend is here to stay, giving rise to new products and client relations strategies.
3. Advanced analytic evidence-based personalization in banking. Advanced customized solutions have been made possible by exploring and analyzing client personal data, and fostering AI and machine learning technologies.
4. Open Banking. Provision of third-party access to customer data with prior consent of the customer for even better tailored offers and wider inclusion of financial market players.
5. New organizational design models, one example being Agile. Transformed approaches to day-to-day operations and more flexible models of departmental performance involving, among others, cross-functional teams for the fastest possible development and testing of a product based on customer feedback.
6. Going beyond traditional financial services. Examples include ecosystem development (as in the case of SBER) and BaaS-based strategies when banks allow partners to access their data to enhance their own services.
According to Roman, the internal development and the delivery of new digital products will make a great difference to Russia’s finance industry. Otkritie Bank is working actively to develop niche services to cover the specific needs of its customers, for example, sole traders and car owners seeking to promote projects such as car marketplaces. “We are working to offer our customers personalized service and to be able to cover their needs directly,” Roman sums up the performance of his bank’s strategists.
Building a career at Otkritie Bank
As the banking sector is growing rapidly, it is an especially good time to build careers in this industry. For four years now Otkritie Bank has been successfully implementing its internship programme called Career Start. Choosing to join and pursue professional development at Otkritie are nearly 60% of its interns.
Career Start invites its participants to:
- contribute to new generation bank’s projects;
- be involved in captivating and ambitious tasks;
- make use of cutting-edge technologies and practices;
- be part of the best market experts team;
- earn competitive pay.
Career Start has recently announced accepting applications for its summer session (starting on the 1st of July). Click here to check open internship vacancies and apply.
