Innovation in business is the ability to conceive, develop, deliver, and scale new products, services, processes, and business models, according to McKinsey.
America’s Most Innovative Companies list for 2023, released yesterday by Fortune, in partnership with Statista, recognizes 300 companies transforming industries from the inside out in a variety of ways. The research found that innovation isn’t just a nice-to-have. In the last three years, almost every company on this list posted revenue growth.
Most of the top 10 companies on the list come from the tech sector, with Alphabet taking the No. 1 spot. However, a financial services company made the top 10—Capital One Financial. Richard D. Fairbank, founder, chairman, and CEO of Capital One, grew the McLean, Va.-based company to one of the 10 largest banks in America and 100 largest companies in the country with $38 billion in annual revenue.
Digital transformation in financial services has been accelerating, in general. But Capital One ranked in the top 10% for process innovation among the companies on Fortune‘s list. Fairbank has led the transformation of the company’s business capabilities, including technology.
“Beginning in 2012, we sought to completely redefine who we are as a company—to operate like a bank that a technology company would build,” Rob Alexander, CIO at Capital One, told me. “You could say that we have been focused on data and technology ever since our founding days as a company.” Fairbank started Capital One with “the idea that an information-based strategy could enable us to build a better financial services business,” Alexander says. “This early vision has scaled as we’ve grown our company, and we’ve seen that technology and data can enable even large companies to be innovative and personalized.”
Some examples? The company “solved a lot of technology challenges faced by America’s largest enterprises, and last year announced Capital One Software, our enterprise B2B software business, to bring some of these solutions to market,” Alexander explains. “Machine learning, A.I., and real-time data are central to how we build our products and services for customers and to how we run our company. Through machine learning, we can proactively serve contextually relevant, personalized information and insights for customers through our mobile app—helping them to get the most out of their money.”
He continues, “We’ve also built a fraud platform to make complex real-time machine learning decisions, with more data, in the time it takes our customers to swipe their credit cards.”
“Our tech organization is actively recruiting for a range of positions, including engineering roles focused on cloud, data, machine learning, and cybersecurity, as well as product managers and technical program managers,” Alexander says.
Fairbank continues his support for a digitally forward company. “As a result of our investments to transform our technology and to drive resilient growth, we’re in a strong position to deliver compelling long-term shareholder value and thrive in a broad range of possible economic scenarios,” he said during the company’s earnings call in January.
Tech’s future in financial services is bright.
Broadridge's 5th annual CX and Communications survey of over 4,000 consumers, analyzes the correlations between consumer demand for an elevated customer experience (CX), and companies’ ability to retain customers. Sixty-nine percent of consumers surveyed want companies to improve their customer experience—a significant increase since 2019 (35%). Over half of consumers (54%) have stopped doing business with a company due to a poor job personalizing the experience.
Across industries, consumers report a disparity between the types of companies that deliver the experiences they expect. There is a large gap between who’s delivering the best experience (banks) and who’s not (retirement funds). What do the leaders do better than others? They make it easy to navigate account details online, communicate clearly, make it easy to talk to a real person, send notifications when there’s something important to look at, and allow customers to select how they want to receive communications, according to Broadridge.
"Win the Race for Higher Risk-adjusted Stock Returns," an article in Wharton's business journal, examines a new paper coauthored by Wharton’s Nikolai Roussanov that uses machine learning to construct investment portfolios that ensure predictability of returns in a world of changing risks.
Adrian Mitchell, Macy’s, Inc. CFO, was appointed to the additional role of chief operating officer. In the combined role, Mitchell will lead the stores, technology, and supply chain teams, in addition to his existing finance and real estate responsibilities. Mitchell has served as CFO since November 2020. He has helped lead the development and execution of the company’s Polaris transformation strategy to drive sustainable and profitable growth. Before joining Macy’s, Inc., Mitchell advised retailers on growth strategies using advanced data and analytics as managing director and partner in the digital and consumer practices of Boston Consulting Group.
Tom Panther was named CFO at FleetCor Technologies, Inc. (NYSE: FLT), a global business payments company, effective May 12. Interim CFO Alissa Vickery will return to her full-time role as chief accounting officer. Before joining FleetCor, Panther served as the CFO at EVO Payments, Inc., prior to its acquisition by Global Payments Inc. Before joining EVO, he worked at SunTrust Banks, Inc. for nearly 20 years serving in numerous leadership roles including chief accounting officer, corporate controller, SVP of corporate finance, and head of capital planning and analysis. Panther began his career at Arthur Andersen.
“This moniker ‘billionaire,’ let’s get at that okay? I grew up in federally subsidized housing, my parents never owned a home, I came from nothing. I thought my entire life was based on the achievement of the American dream. Yes I have billions of dollars, I earned it. No one gave it to me.”
—Starbucks former CEO Howard Schultz said on Wednesday during his Senate testimony, when members questioned him about Starbucks’ treatment of workers and unions, and Sen. Bernie Sanders (I-Vt.) and other committee members repeatedly referred to him as a billionaire, Fortune reported.
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