Concluding remarks

In this chapter, we have discussed strategies to deal with the digital dilemmas that banks and marketplace lenders face. The first step in formulating digital strategy is taking into account the way in which innovations unfold in a digital market.

The biggest challenge for banks is to overcome their inability to cultivate disruptive innovation on their own, and in their own midst. To stay relevant, banks need to overcome the innovator's dilemma—with strategies such as separating innovation companies from their main operations, planning to fail cheaply, relieving innovators from corporate rules and processes, and finding and cultivating new markets. Finally, open innovation can furnish banks with ideas to stay relevant to customers. Banks becoming more attractive for collaborations with innovators is one of the first important steps in crafting the hybrid financial sector of the future.

NOTES

1. Rogers, Everett (2003) Diffusion of Innovations, 5^th Edition (New York: Free Press, a Division of Simon & Schuster).

2. Gartner (2015a) “Gartner Hype Cycle.” http://www.gartner.com/technology/research/methodo- logies/hype-cycle.jsp.

3. Gilette, Felix (2011) “The Rise and Inglorious Fall of Myspace,” Bloomberg Business, 22 June 2011, http://www.bloomberg.com/bw/magazine/content/11_27/b4235053917570.htm, date accessed 22 May 2015.

4. Dominic Rushe (2011) “Myspace sold for $35m in spectacular fall from $12bn heyday” (the Guardian, 30 June 2011), http://www.theguardian.com/technology/2011/jun/30/myspace-sold-35- million-news, date accessed 22 May 2015.

5. Millward Brown Digital (2015a) Compete, https://siteanalytics.compete.com/facebook.com/, date accessed 22 May 2015.

6. Bloomberg (8 September 2014) “Facebook Valuation Tops $200 Billion,” http://www.bloomberg.com/infographics/2014-09-08/facebook-valuation-tops-200-billion.html, date accessed 22 May 2015.

7. Downes, Larry and Nunes, Paul (2014) Big Bang Disruption: Strategy in the Age of Devastating Innovation (New York: Penguin).

8. Christensen, Clayton (1997) The Innovator’s Dilemma: When New Technologies Cause Great Firms to Fail (Harvard: Harvard Business School Press).

9. Ismail, Salim (2015) Exponential Organizations: Why new organizations are ten times better, faster, and cheaper than yours (and what to do about it) (New York: Diversion Books).

10. Diamandis, Peter and Kotler, Stephen (2015) Bold: How to Go Big, Achieve Success, and Impact the World (New York: Simon & Schuster).

11. Downes, Larry and Nunes, Paul (2014) Big Bang Disruption: Strategy in the Age of Devastating Innovation (New York: Penguin).

12. Chesbrough, Henry (2003) Open Innovation: The New Imperative for Creating and Profiting from Technology (Harvard: Harvard Business Review Press).

13. Chesbrough, Henry (2011) Open Services Innovation: Rethinking Your Business to Grow and Compete in a New Era (San Francisco: Jossey-Bass).

14. Mintzberg, Henry (1978) “Patterns in Strategy Formation” (Management Science, Vol. 24, No. 9 (May, 1978), pp. 934-948), http://www.jstor.org/stable/2630633.

15. Ibid.