How PSD2 is set to change banking up as we know it …

Fig. 1 – A prophetic vision by Bill Gates!? – Taken from: https://www.slideshare.net/patrickpijl/how-square-is-disrupting-banks/6-Bill_GatesBANKING_ISNECESSARYBANKS_ARENOT

“Banking is necessary.  Banks are not.”  Yep. Bill Gates said it. Back in 1994. And 28 years later, it’s it’s set to become reality. From the 1st January 2018, banking will no longer be the exclusive domain of banking institutions because PSD2 is going to drastically alter the way in which we bank.

The biggest consequence is that more than 4,000 European banks will need to open their legacy (mainframe) data stores to Third Party Players (‘TPPs’) and allow them to retrieve account information (‘AIS’) or initiate payments (‘PIS’). Both capabilities will be facilitated through APIs. I wrote about the scope and ramifications of PSD2 a few months ago, and I’ve been thinking ever since about the implications for existing banks and whether they’ve got reason to be scared.

It would be surprising if some of the traditional banks weren’t nervous about the extent to which they’ll have to open their kimonos under PSD2. And even if the Facebooks, Googles or Amazons of this world don’t become banks overnight, I expect the traditional, lifelong bank-customer relationship to slowly evaporate as a result of PSD2 (and subsequent versions of PSD).

Fig. 2 – PwC: PSD2 providing third party access to data and payments via APIs – Taken from: https://www.finextra.com/finextra-downloads/newsdocs/catalyst-or-threat.pdf

Facebook could easily decide to become an AISP (Account Information Service Provider – see Fig. 2 above), which would enable them to offer an aggregated view of a user’s bank accounts. As a result, they would be able to analyse spending behaviour, understand their users’ financial profiles and personalise a user’s banking experience. This isn’t that revolutionary, as virtual assistants like Cleo and Treefin have already starting offering this functionality, and I believe it’s highly likely that we’ll see it roll out across Facebook Messenger or WeChat in the near future. If you need more convincing, Facebook made their first move two years ago by appointing David Marcus, former CEO of PayPal, to head up Facebook Messenger, so watch this space. Similarly, US bank Capital One integrated with Amazon’s virtual assistant Alexa last year. This integration enables Capital One customers to pay their credit card bills and check their balances, by talking to their Alexa devices.

Fig. 3 – PwC: Six API-powered banking business models – Taken from: https://www.finextra.com/finextra-downloads/newsdocs/catalyst-or-threat.pdf

In addition, any remaining doubters about the power of APIs are likely to be converted as a result of PSD2. In the current Fintech landscape, there already are large number of banks that are either using APIs to hook into existing banking infrastructures (e.g. Varo Money) or offer additional services (e.g. N26). PwC recently conducted a study into the strategic implications of PSD2 for European banks and they listed no less than six API-powered banking business models (see Fig. 3 above).

Main learning point: It will be interesting to see what the actual impact of PSD2 will be, but if I were a traditional European bank, I’d be working as hard as I could to open up my APIs from today and start working on the creation of strong alliances with 3rd parties and their developers. As Nas once rapped on “N.Y. State Of Mind”, “I never sleep cause sleep is the cousin of the death.” If I were a traditional bank I’d follow Nas’ advice and give up on sleep completely …

Nas, lyric on “N.Y. State of Mind (Illmatic, 1994) – Taken from: https://uk.pinterest.com/MrConceptz/hiphop-101/

 

Related links for further learning:

  1. https://www.finextra.com/blogposting/14101/psd2-is-fast-approaching-dont-bury-your-head-in-the-sand
  2. https://www.finextra.com/videoarticle/1469/data-is-a-key-legal-issue-for-open-banking
  3. https://techcrunch.com/2017/01/12/what-facebooks-european-payment-license-could-mean-for-banks/
  4. http://www.ibtimes.co.uk/apple-facebook-amazon-primed-psd2-demolition-card-networks-1606188
  5. https://www.siliconrepublic.com/enterprise/fintech-banking-psd2
  6. http://www.bankingtech.com/675841/psd2-and-the-future-of-payments/
  7. https://www.evry.com/en/news/articles/psd2-the-directive-that-will-change-banking-as-we-know-it/
  8. http://www.sepaforcorporates.com/single-euro-payments-area/5-things-need-know-psd2-payment-services-directive/
  9. https://techcrunch.com/2015/07/12/the-future-of-finance-is-in-real-time/
  10. https://www.finextra.com/finextra-downloads/newsdocs/catalyst-or-threat.pdf
  11. http://www.pymnts.com/news/b2b-payments/2015/task-force-launches-eu-instant-payment-plan/.VYpo1rnhBTI
  12. https://venturebeat.com/2016/06/05/say-hello-to-messenger-banking/
  13. https://www.finextra.com/newsarticle/28602/capital-one-integrates-with-amazon-alexa-for-voice-powered-payments

 

App review: Grip

 

Grip is a London based startup that specialises in “smart event networking software”. That sounds like a relevant problem to solve, because don’t we all have a (secret) love-hate relationship with ‘networking’ at events!?

Yes, I’d love to meet with interesting people at events but I hate approaching people randomly.

Let’s have a closer look at how Grip is looking to solve this problem:

My quick summary of Grip (before using it) – I expect an app that uses clever algorithms to suggest relevant people to meet during events.

How does Grip explain itself in the first minute? – The Grip homepage describes the tedium involved in networking at events, with attendees often failing to make the connections they’d hoped for. Grip’s value proposition is to remove this tedium by unlocking “valuable connections at your event, saving attendees time and hard work. We use advanced algorithms to recommend the right people and present them in an easy swiping interface that your attendees will love.”

Getting started, what’s the process like? – Grip uses natural language processing to connect event attendees based on interest, needs and other things they’ve got in common. I liked Grip’s ability to tell an attendee not just who, but also why they should meet someone, in the form of Reasons To Meet.

Grip users will be able to tailor the real-time recommendations they get by setting their own matchmaking rules. I like the element of Grip not totally relying on machine learning, but also giving users the opportunity to feed their preferences into category rules into the Grip dashboard. This will influence the matchmaking engine in real-time and improve the future recommendations for event exhibitors, delegates and sponsors.

I can imagine that the data around users’ acceptance or rejection of Grip’s suggested matches, will help in further refining the app’s recommendations. This reminded me about the review that I did of THEO recently. THEO acts a ‘robo-advisor’ and uses machine learning to provide its users tailored investment advice.

Integrating the Grip API – Apart from the app, Grip have also got their own API, which makes it easier for companies to incorporate event matchmaking capability into their website or apps.

Main learning point: Grip is taking a significant problem for event attendees and exhibitors, and is using machine learning to solve this problem in a real-time and personalised fashion.

Related links for further learning:

  1. https://grip.events/handsake-event-networking/
  2. https://www.eventbrite.co.uk/blog/event-tech-adoption-at-events-ds00/
  3. https://grip.events/ai-event-matchmaking/
  4. https://grip.events/7-secrets-game-changing-event-networking/
  5. http://event-profs.com/world-first-artificially-intelligent-event-technology/
  6. https://marcabraham.com/2017/04/19/app-review-theo/
  7. https://www.eventbrite.co.uk/blog/event-tech-startups-2017-ds00/

 

Lessons learned from Uri Levine, Co-Founder of Waze

Last Friday, I attended a talk by Uri Levine, Co-Founder of Waze, a community-based traffic and navigation app that was sold to Google for $1.1 billion. In a two-hour session, Uri shared some of his key learnings from the Waze startup journey; from starting from scratch to a successful exit. I felt that his talk was packed with valuable insights, and I’ve selected some key ones to share:

Focus on the problem – I loved how Uri concentrated on the problem that you’re looking to solve. He talked about problem solving being a key driver for him and the different startups that he’s (been) involved in. For example, Waze originated from Uri’s frustration with traffic jams … Uri then talked us through the “Adjusted Startup Curve” to illustrate the typical journey of a startup, starting with a problem to solve (see Fig. 1).

Fig. 1 – Knife Capital’s “Adjusted Startup Curve” – Taken from: http://ventureburn.com/2013/07/the-startup-curve-south-africa-wiggles-of-realism/

Don’t be afraid to fail – I always find it incredibly refreshing when other people speak openly about failures and not being afraid to fail. As Uri rightly pointed out, the fear to fail (and therefore not trying) is a failure in itself (see Fig. 2). He was also keen to stress that creating and managing a startup is never a linear, upward journey. By contrast, you effectively go from failure to failure, but you might win in the end – if you’re lucky that is (see Fig. 3).

Fig. 2 – Michael Jordan quote about failure – Taken from: http://www.quotezine.com/michael-jordan-quotes/

Fig. 3 – “Journey of Failures” by Douglas Karr – Taken from: https://twitter.com/douglaskarr/status/333027896241299457/photo/1

Passion for change – Uri’s points about entrepreneurs and their passion for change really resonated with me. I’m not an entrepreneur, but I feel that I’ve got some innate restlessness which is usually fed by change, learning and trying new things. It was interesting hearing Uri talk about how this passion usually doesn’t sit with well with fear of failure or loss. “Move fast and break things” was one of Uri’s mantras in this regard.

Honest validation of your ideas – As an entrepreneur, Uri explained, you need to fall in love with your idea. However, he also highlighted the importance of being able to critically assess your own idea. He suggested asking yourself “who will be out of business if I succeed?” If you don’t know the answer to this question, Uri explained, your idea probably isn’t big enough.

Iterate based on user feedback – Uri reminded me of the mighty David Cancel as David is also very focused on solving customer problems and listening to customer feedback (see Fig. 4). Like David, Uri didn’t get overly zealous about Agile or lean development methods. Instead, Uri talked about constantly iterating a product or service based on customer feedback.

Fig. 4 – David Cancel at Mind the Product conference, London 2016 – Taken from: http://www.mindtheproduct.com/2016/12/importance-listening-customers-david-cancel/

Main learning point: I found Uri Levine’s talk hugely inspiring; he was honest about the challenges involved in creating or working at a startup whilst at the same encouraging us to solve problems and try things.

Related links for further learning:

  1. http://www.tellseries.com/events/uri-levine/
  2. http://uk.businessinsider.com/how-waze-co-founder-spends-his-money-2015-8
  3. https://www.ft.com/content/49857280-8eaf-11e5-8be4-3506bf20cc2b
  4. https://www.crunchbase.com/person/uri-levine#/entity
  5. https://www.theguardian.com/media-network/2015/may/28/waze-uri-levine-tips-startup-google

My product management toolkit (21): Assessing opportunities

Earlier this year I wrote about the tools and techniques to use when exploring market viability. I believe that the ability to properly assess specific opportunities is closely linked. I’ve found that, especially at the early startup stage, there are plenty of opportunities to potentially go for, as they’ll all bring in revenue and offer growth potential.

However, I believe that this can be a blessing and a curse. I’ve seen companies that went for all business / market opportunities and ended up with heaps of technical debt, operational cost or bespoke solutions that couldn’t be reused. Hence why I believe it’s critical for us product managers to be able to assess opportunities and make tough tradeoff decisions.

Let’s look at some of the tools and techniques you can use to assess and decide on opportunities:

1. Business Case

 

Fig. 1 – Sample business case format – Taken from: https://www.slideshare.net/projectingit/the-prince2-business-case

I’m pretty sure that we’ve all seen a business case template like the one in Fig. 1 before. The biggest risk I see with most business cases is that people spend an awful lot of time drafting them, for the business case to become obsolete as soon as the product has been built or launched.

Pros:

  • A familiar format for most stakeholders
  • Detailed breakdown of revenue & cost projections

Cons:

  • Often based on lots of assumptions, which are then treated as gospel
  • Often out of date as soon we start building or launching a product

2. Opportunity Assessment

1. Exactly what problem will this solve? (value proposition)
2. For whom do we solve that problem? (target market)
3. How big is the opportunity? (market size)
4. What alternatives are out there? (competitive landscape)
5. Why are we best suited to pursue this? (our differentiator)
6. Why now? (market window)
7. How will we get this product to market? (go-to-market strategy)
8. How will we measure success/make money from this product? (metrics/revenue strategy)
9. What factors are critical to success? (solution requirements)
10. Given the above, what’s the recommendation? (go or no-go)

By Marty Cagan – Taken from: http://svpg.com/assessing-product-opportunities/

In my toolkit blog post no. 6 I wrote about Marty Cagan’s opportunity assessment, and how you can compare product opportunities or ideas in a very objective and like-for-like manner.

Pros:

  • Less time consuming than business cases
  • More market, customer and problem centric, easy to translate into testable hypotheses
  • Outcome focused, establishing clear success factors early on

Cons:

  • Unfamiliar format for some stakeholders
  • Less numbers centric than a business case

3. Auftragsklärung (Alignment Framework)

Fig. 3 – Auftragsklärung template – Taken from: http://produktfuehrung.de/framework-no-9-auftragsklarung/

The product guys at Germany-based Xing have a created a very useful tool called “Auftragsklärung” or Alignment Framework, which helps assessing opportunities at the earliest stage possible.

Pros:

  • Helps to ‘take a step back’, honing in on fundamental questions
  • Facilities strategic thinking
  • Ongoing reference point for bigger opportunities 
  • Outcome and metric focused

Cons:

  • Unfamiliar format for some stakeholders
  • Risk of being too high level to base trade-off decisions on

4. Scoring

Fig. 4 – Scoring against a number of assessment factors – Taken from: https://www.slideshare.net/JasonBrett/the-60-second-business-case

What I like about this “scoring” method as created by Jason Brett is the idea of quantifying one’s assessment, using comparative scores. At the same time, however, my worry is that people can score subjectively to achieve a desired result.

Pros:

  • Encourages thinking about key considerations e.g. customer experience and operational necessity
  • Quantifiable and comparable results

Cons:

  • Risk of people making up numbers to meet the criteria 🙂
  • Finger in the air and subjective
  • Harder if some of the weighting factors have not been fully defined

5. Change Types

Fig. 5 – Doblin Ten Types of Innovation – Taken from: http://blog.hypeinnovation.com/using-the-ten-types-of-innovation-framework

With Doblin’s Ten Types of Innovation, the focus isn’t just on the product that you’re looking to develop. The model encourages us as product manager to carefully consider aspects such as the underlying business model and the experience around your product or service.

Pros:

  • Encourages thinking about business and customer impact
  • Easy to translate and communicate from a dual track roadmap point of view
  • Thinking beyond just the product or service

Cons:

  • High level, harder to base trade-off decisions on
  • Open to subjective views on nature of change

6. Minimum Viable Product (‘MVP’)

Fig. 6 – Definition of an MVP – Taken from: https://www.quora.com/Where-is-the-line-for-MVPs-minimum-viable-products-What-are-your-principals-guidelines-for-defining-your-MVP-in-particular-where-to-stop-building-too-much

Readers of my blog will undoubtedly know how much of a fan I am of MVPs, but only in the truest sense of the word. For example, when I developed my own MVP a few years ago, I tried to be as strict as possible with the minimum number of feature that could deliver maximum value to my users and maximum learning to me.

Pros:

  • Delivering value early
  • Early customer validation
  • Bringing riskiest assumptions forward
  • Increase speed to market

Cons:

  • Misunderstanding of what an MVP is / isn’t
  • Open to abuse; misinterpreting “minimum” and “viable”
  • “When are you going to do everything else!?”

7. Calculating Cost of Delay

Fig. 7 – Cost of Delay; Weighted Shortest Job First  (taken from: http://scalingsoftwareagilityblog.com/prioritizing-features/)

Fig. 8 – Cost of Delay Divided by Duration – Taken from: http://blackswanfarming.com/cost-of-delay-divided-by-duration/

When assessing opportunities or making tradeoff decisions it’s important to look at the cost of not doing something (now). I often see people either deciding to everything at one – I don’t consider that prioritisation 🙂 –  or not take into account cost of delay when making assessments.

8. Calculating Return on Investment (‘ROI’)

Fig. 9 – ROI formula – Taken from: https://www.poweredbysearch.com/blog/ppc-advertising-roi-calculator/

Similar to creating business creating business cases, the risk with calculating ROI at the very beginning of the product lifecycle or project is that you pluck figures out of the air. Often this simply occurs because you don’t yet have any actual figures to apply – especially with true greenfield opportunities.

However, having  initial ROI calculations based on the numbers available can serve as a very useful ongoing reference point to compare as soon as the product enters its lifecycle. This way you can start comparing and contrasting actual vs planned ROI and act based upon your insights gained.

Main learning point: Whichever tool or approach you use to assess opportunities I don’t care, as long as you find a way to ‘take a step back before going straight into decision and/or build mode!

Related links for further learning:

  1. https://www.prince2.com/uk/prince2-business-case
  2. http://svpg.com/assessing-product-opportunities/
  3. http://produktfuehrung.de/framework-no-9-auftragsklarung/
  4. https://en.wikipedia.org/wiki/Outcome-Driven_Innovation
  5. https://hbr.org/2002/01/turn-customer-input-into-innovation
  6. http://johnpeltier.com/blog/2014/01/06/opportunity-assessment/
  7. https://www.slideshare.net/JasonBrett/the-60-second-business-case
  8. http://blog.hypeinnovation.com/using-the-ten-types-of-innovation-framework
  9. http://blackswanfarming.com/four-steps-to-quantifying-cost-of-delay/
  10. https://marcabraham.wordpress.com/2014/04/07/my-learnings-from-lean-day-london-14/
  11. http://blackswanfarming.com/wp-content/uploads/2014/03/BlackSwanFarming-Canvas.pdf
  12. http://blackswanfarming.com/cost-of-delay-divided-by-duration/
  13. http://www.marketingmo.com/campaigns-execution/how-to-calculate-roi-return-on-investment/
  14. http://www.investopedia.com/articles/basics/10/guide-to-calculating-roi.asp
  15. http://www.tracead.net/161/roi-return-on-investment-how-to-calculate-roi
  16. http://transformcustomers.com/minimum-viable-product-how-it-helps-time-to-market/
  17. https://www.quora.com/Where-is-the-line-for-MVPs-minimum-viable-products-What-are-your-principals-guidelines-for-defining-your-MVP-in-particular-where-to-stop-building-too-much

 

App review: Vipps

I’m always on the lookout for new payment apps and I recently came across Vipps. Vipps is a Norwegian peer to peer payments app, currently only available to Norwegian users.

Fig. 1 – Screenshot of Vipps – Taken from: https://www.vipps.no/

These are the main things I’ve learned about Vipps:

  1. Use the recipient’s mobile number – Similar to the way the likes of Monzo and Uber work, with the Vipps app all you need is the mobile number of the recipient. If you need to send money to someone else, your friend needs to download the Vipps app and the amount will be sent to his/her account registered with Vipps. Select the person you want to pay from your phone’s contact list or enter their mobile number.
  2. Use Vipps to split bills – For example, when you’re eating out with a group of friends, you can ask your friends for money when splitting the bill. Create a group name – e.g. Nando’s on Friday – and add the names of the group members. Now people in your group can enter all expenses that are to be shared between the group members. Once all the amounts have been entered and everyone has confirmed that there are no more outlays, it is easy to see who owes what.
  3. Personal account registered with Vipps – Vipps doesn’t have it’s own current account. Instead, users can send money through Vipps from any Norwegian bank, provided that they have a bank debit card and a bank account with the bank in question.
  4. Getting started with Vipps – To be able to use Vipps, users need to enter a Norwegian national identity number, a Norwegian mobile number, the details of their payment card (Visa or MasterCard), their Norwegian bank account number and an email address. Once you’ve created a four digit code, you can start paying or receiving money. When logging into Vipps, you can use your personal code or Touch ID.
  5. Vipps’ charges – Vipps doesn’t charge for amounts below NOK 5 000. For payments of NOK 5 000 or above, the charge is 1 per cent of the total amount. There is no charge for receiving money.

Main learning point: Love how apps like Vipps are making it easier and easier for people to pay and receive money. The splitting bills functionality is very welcome!

Vipps 3

Fig. 2 – Vipps’ peer-to-peer payments – Taken from: http://anti.as/news/vipps-by-dnb

Vipps 4

Fig. 3 – Screenshot of Vipps’ Android app; making a payment – Taken from: https://play.google.com/store/apps/details?id=no.dnb.vipps

Vipps 5

Fig. 4 – Screenshot of Vipps’ iOSapp; selecting a contact or a company that you want to pay – Taken from: https://www.appannie.com/en/apps/ios/app/vipps-by-dnb/

Related links for further learning:

  1. https://www.vipps.no/
  2. https://itunes.apple.com/us/app/vipps-by-dnb/id984380185?mt=8
  3. https://www.finextra.com/newsarticle/30131/dnb-spins-off-vipps-mobile-payment-service
  4. http://anti.as/projects/vipps-by-dnb
  5. https://en.wikipedia.org/wiki/Vipps
  6. http://www.lifeinnorway.net/living/money/mobile-payments/
  7. https://play.google.com/store/apps/details?id=no.dnb.vipps&hl=en_GB
  8. https://www.youtube.com/watch?v=_Mx5lsfs2d0
  9. https://www.vipps.no/vilkar.html
  10. https://www.microsoft.com/en-gb/store/p/vipps-by-dnb/9nblgggz9jv1

Book review: “Influence without Authority”

As product managers, we’ve all experienced it: a sense of frustration when you’re accountable for delivering value without having any authority over the people that are critical to delivering that value. Whether’s it’s stakeholders, customers, developers, designers, there’s only so much we can do to influence and create the level of buy-in or cooperation required to create successful products.

In Influence without Authority (2005) Allan R. Cohen and David L. Bradford explore ways in which we can influence others without having authority over them. Cohen and Bradford’s “Model of Influence without Authority” forms the backbone of this book (see Fig. 1 below).

 

Fig. 1 – Summary of the Cohen-Bradford Model of Influence without Authority – Taken from: https://uk.pinterest.com/pin/328270260312405687/

“Influence without Authority” outlines the key components of this model, illustrating the scenarios in which the model can be applied. These are the three learning points I took away from reading this book:

  1. The currencies of exchange – The aforementioned Cohen-Bradford model is based on exchange and reciprocity – making trades for what you desire in return for what the other person desires. There are number of potential currencies that one can use to trade (see Fig. 2 below).
  2. Gaining clarity on your objectives – For the Cohen-Bradford model to work effectively, it’s important that you figure out exactly what you want, and prioritise your goals accordingly (see Fig. 3 below).
  3. Deciding with whom to attempt exchanges – The ability to consider and decide potential allies to exchange is a critical part of the Cohen-Bradford model and the book outlines some valuable considerations how to exchange directly with a potential ally (see Fig. 4 below).

Fig. 2 – Frequently valued currencies – Taken from Allan R. Cohen and David L. Bradford, “Influence without Authority”, pp. 36 – 51

Inspiration related currencies:

Inspiration related currencies reflect inspirational goals that provide meaning to the work a person a does.

  • Vision – You can help overcome personal objections and inconvenience if you can inspire the potential ally to see the larger significance of your request.
  • Excellence – The opportunity to do something really well and pride in having the chance to accomplish important work with genuine excellence can be highly motivating.
  • Moral/ethical correctness – Probably most members of organisations would like to act according to what they perceive to be ethical, moral, altruistic or correct thing to do.

Task related currencies:

Task related currencies are directly related to getting the job done. They relate to a person’s ability to perform his or her assigned tasks or to the satisfactions that arise from accomplishment.

  • New resources – Resources such as budget, people, space, equipment or time are important currencies when it comes to enabling someone to get the job done.
  • Challenge – The chance to work at tasks that provide a challenge or stretch is one of the most widely valued currencies in modern organisational life.
  • Assistance – Although large numbers of people desire increased responsibilities and challenge, most have tasks they need help on or would be glad to shed.
  • Organisational support – This currency is most valued by someone who is working on a project  and needs public backing or behind-the-scenes help in selling the project to others.
  • Rapid response – It can be worth a great deal for a colleague or boss to know that you will respond urgently to requests.
  • Information – Recognising that knowledge is power, some people value any information that may help them shape the performance of their unit.

Position related currencies:

These currencies enhance a person’s position in the organisation and, thereby, indirectly aid the person’s ability to accomplish tasks or advance a career.

  • Recognition – Many people gladly will extend themselves for a project when they believe their contributions will be recognised, so it’s importance to spread recognition around and recognise the right people.
  • Visibility to higher ups – Ambitious employees realise that, in a large organisation, opportunities to perform for or to be recognised by powerful people can be a deciding factor in achieving future opportunities, information, or promotions.
  • Reputation – Reputation is another variation on recognition. A good reputation can pave the way for lots of opportunities while a bad one can quickly shut the person out and make it difficult to perform.
  • Insiderness – For some members, being in the inner circle can be most valued currency. One sign of this currency is having insider information, and another is being connected to important people.
  • Importance – A variation on the currency of inside knowledge and contacts is the chance to feel important. Inclusion and information are symbols of that, but just being acknowledged as an important player counts for the large number of people who feel their value is under recognised.
  • Contacts – Related to many of the previous currencies is the opportunity for making contacts, which creates a network of people who can be approached when needed for mutually helpful transactions.

Relationship related currencies:

Relationship related currencies are more connected to strengthening the relationship with someone than directly accomplishing the organisation’s tasks.

  • Acceptance / Inclusion – Some people most value the feeling that they are close to others whether an individual or a group/department. They are receptive to those who offer warmth and liking as currencies.
  • Understanding / listening / sympathy – Colleagues who feel beleaguered by the demands of the organisation, isolation or unsupported by the boss, place an especially high value on a sympathetic ear.
  • Personal support – For some people, at particular times, having the support of others is the currency they value most. When a colleague is feeling stressed, upset, vulnerable, or needy, he will doubly appreciate – and remember – a thoughtful gesture.

Personal currencies:

These currencies could form an infinite list of idiosyncratic needs. They are valued because they enhance the individual’s sense of self. They may be derived from task or interpersonal activity.

  • Gratitude – While gratitude may be another form of recognition or support, it is a not necessarily job-related one that can be valued highly by some people who make a point of being helpful to others. For their efforts, some people want appreciation from the receiver, expressed in thanks or deference.
  • Ownership/Involvement – Another currency often valued by organisational members is the chance that they feel that they are partly in control of something important or have a chance to make a major contribution.
  • Self – concept – These currencies cover those that are consistent with a person’s image of himself or herself.
  • Comfort – Some individuals place high value on personal comfort. Lovers of routine and haters of risk, they will do almost anything to avoid being hassled or embarrassed.

Negative currencies:

Currencies are what people value. But it is also possible to think of negative currencies, things that people do not value and wish to avoid:

‘Withholding payments’

  • Not giving recognition
  • Not offering support
  • Not providing challenge
  • Threatening to quit the situation

‘Directly undesirable’

  • Raising voice, yelling
  • Refusing to cooperate when asked
  • Escalating issue upwards to common boss
  • Going public with issue, making lack of cooperation visible
  • Attacking person’s reputation, integration

Fig. 3 – Gain clarity on your objectives – Taken from Allan R. Cohen and David L. Bradford, “Influence without Authority”, p. 82

  • What are your primary goals?
  • What personal factors get in the way?
  • Be flexible about achieving goals.
  • Adjust expectation of your role and your ally’s role.

Fig. 4 – Deciding with whom to attempt exchanges – Taken from Allan R. Cohen and David L. Bradford, “Influence without Authority”, pp. 134 – 136

  • Centrality of the ally – How powerful is the other person? Power means more than hierarchical position: What needed resources does he or she control? How exclusive is the person’s control of those resources? How dependent are you on that person for success?
  • Amount of effort / credits needed – Do you already have a relationship with the person, or will you be starting from scratch? Is the person likely to insist on trading in currencies you do not command or cannot gain access to? Will the person be satisfied as long as you at least pay your respects and stay in touch, without asking anything directly?
  • Alternatives available – Do you know anyone whose support will help gain the support of the potential ally? In other words, who can influence the ally if you are not able to directly? If you can’t influence the person in the right direction, can you find a way to neutralise him or her? Can you reshape your project to take the person’s opposition into account or to skirt the person’s worst concern?

App review: THEO

Fig. 1 – Screenshot of THEO – Taken from: http://fintechnews.sg/3137/roboadvisor/robo-advisory-services-asia/

I recently came across THEO, a mobile, Japanese investment service offered by Money Design. THEO acts as a ‘robo-advisor’; enabling users to invest using their smartphone, and applying machine-based learning to offer users investment suggestions. The service allows users to start investment from 100,000 JPY. By answering nine questions (see Fig. 2 below), Money Design’s proprietary robo-advisor’s algorithm selects an optimum combination from about 6,000 Exchange-Traded Funds (‘ETFs’) in about two minutes and provides discretionary investment management to the user.

Fig. 2 – Screenshot of questions asked to THEO users to create their investment profile 

The user’s answers will trigger THEO’s underlying algorithms to deliver the most optimal money management plan for the user (see Fig. 3). At this point, we’ll need to consider the artificial intelligence aspect of THEO. This is where the accuracy of the proposed plan, as generated by THEO’s algorithms, comes into play (see Fig. 3 below). As one Japanese investor commented: “I am an aggressive investor with a long timescale so I was surprised to see how conservative the allocation ended up.”

 

Fig, 3 – Screenshot of sample diagnosis results based on answering THEO’s questions

Main learning point: The key point with apps like THEO is going to be the accuracy and personal fit of the investment plan its algorithms will suggest to investors. I wonder whether any manual ‘tweaking’ is involved in assessing investment profiles and subsequent recommendations.

Related links for further learning:

  1. http://jftoday.com/THEO,+the+robo-advisory+investment+app,+exceeds+5,000+users+for+100days/
  2. https://www.bloomberg.com/news/articles/2016-07-12/hedge-fund-founder-turns-robo-adviser-for-japan-s-cash-hoarders
  3. http://fintechnews.sg/3137/roboadvisor/robo-advisory-services-asia/
  4. http://www.retirejapan.info/blog/japan-robo-advisor-theo
  5. https://theo.blue/
  6. http://www.investopedia.com/terms/e/etf.asp
  7. http://fintechnews.sg/3137/roboadvisor/robo-advisory-services-asia/
  8. http://www.theasianbanker.com/updates-and-articles/robo-advisors-poised-to-take-off
  9. http://uk.reuters.com/article/us-china-wealth-roboadvisors-idUKKCN10S2GT
  10. http://finovate.com/drivewealth-brings-robo-advisory-china-new-partnership-creditease/
  11. https://medium.com/@Mosaic_VC/trust-in-a-robo-advisor-world-62397cbe75fe
  12. http://www.wired.co.uk/article/how-ai-is-transforming-the-future-of-fintech
  13. https://en.wikipedia.org/wiki/Artificial_intelligence