Bank Of America A Case Solution

1. How would you characterize I&D’s corporate setting for developing services in terms of a) the innovation process, b) new services roll-out strategy, c) management issues, and d) company culture?

a. The Innovation Process 

I&D’s corporate setting for developing services in terms of the innovation process had been a streamlined, and detailed five-step process. The first step included devising ideas for experiments that could be undertaken in the test branches and then assessing and prioritizing them. The team focused on categorizing each experiment as either high, medium or low priority based on its impact, the customers it targeted and financial feasibility. Followed by a planning and designing phase which focused on quickly designing, building and rollout of the idea. Next, the designed experiment is implemented and tested rigorously so as to eliminate any possible problems before going live with customers in test branches. The final phase was of recommendation where the ideas were thoroughly evaluated from the perspective of rolling them out on a national level.

b. New Services Roll-Out Strategy

In terms of new services rollout strategy, the I&D team believed that it was vital for the experimentations to mirror reality or in other terms possess high fidelity. The team focused on experimenting with live banking situations which ensured that the learnings were duplicable in other branches across different geographic regions as well and not confined to the I&D's test markets. The team gained considerable experience from these experimentations and also understood a variety of factors that affected learning such as; high fidelity, minimizing the effect of noise, rapid feedback, increasing experimentation capacity and the extent to which radical experiments generate more learnings.  

c. Management Issues 

The management issues that persisted were related to the fact that the I&D team was held back from taking a full-fledged approach to true innovation and hence, no such radical innovation occurred and the focus was only on incremental innovation. The team focused on minimizing failures in spite of ensuring that necessary innovative measures were taken. The I&D's centres were also located in a specific facility having similar kind of culture and hence, not reflective of the company's overall culture and values across the globe. The experiments carried out in these test centers were often not duplicable in other branches given the constrained innovative culture and traditional industry attitude which didn't facilitate innovation in its purest from in the first place.

d. Company’s Culture

Initially, the company's culture lacked the outlook towards innovation, however, later on, the company realized the changing dynamics of the industry and hence, the need to innovate in terms of their services and products. Initiatives such as Bank of America Spirit Program resulted in an increase of motivation levels of employees and hence, most of them welcomed the change positively reducing the turnover rate as compared previously. However, certain reservations as a result of the I&D team's initiatives stemmed as the employees highlighted the compensation and incentive issues present in the company.

2. What was the business role of experimentation at BofA? How can companies maximize their learning from experimentation?

The business role of experimentation at BofA allowed the bank to grow organically as time passed the industry faced several challenges such as acquisition opportunities lessened and hence, they needed to find a solution to stay ahead in the industry. This could only be done by attracting customers, ensuring that they are satisfied and their needs are met along with ensuring technological advancements on the go. Initially, the industry focused on providing services just the way the competitors had done so however, this soon resulted in a decline in terms of growth. The BofA had never made innovation a priority and hence also lacked any formal infrastructure for developing services but with the commitment, the company tried to bring in a change in the conventional thinking and practices.