In 2017, Charlotte Wood became the first Head of Innovation and Fintech Alliances at Schroders, a global investment management firm. She is responsible for building the company’s global innovation strategy as well as the adoption and engagement of Fintech services across the firm.
During her time at Schroders she has founded Cobalt, a startup residence tech programme which allows the firm to engage and collaborate with early-stage fintech startups and also helps them to bring their products and services to market.
Charlotte was shortlisted for ‘Innovation of the Year’ award in 2018 at the Financial Asset Management Awards. She was also named in Innovate Finance’s ‘Standout 35’ Powerlist for making a real impact in the fintech ecosystem.
In this latest episode of Innovation Insights, Charlotte sits down with Charlie de Rusett, Founder of Idea Drop to discuss the role that senior leadership plays at the firm in making sure the business is constantly being motivated to be innovative. She also talks about the benefits of open innovation and explains what external resources are necessary in order to accelerate innovation.
Charlotte speaks about the importance of transparency within the firm when it comes to capturing ideas and also explains Schroder’s current ideation process which enables their employees to collaborate and participate in the innovation process.
Watch the full episode now:
Below you can find a transcript of this episode.
Charlie de Rusett: I think that everyone watching is probably wondering what innovation means to Schroders, and I’m actually wondering what it means on a personal level to you, Charlotte.
Charlotte Wood: Schroders has always been an innovative company, because it’s been around for 250 years and change from being a merchant bank to private bank and now an asset manager, I think has been a revolution in that time. What is different now is the pace of technological change, and also the pace of changing the demographics of our clients. So for me in working for Schroders in the last 2 years, we’ve learnt a lot about innovation from both internal corporate perspective and also how we can best draw on ideas and technology solutions from the market.
I think corporate innovation is really important – we need to take advantage of the great ideas within our teams and the expertise that we have across the business. However, there are a lot of challenges involved – we find that the ideas that people have tend to be relatively incremental, cause they are very much focused on their job, what they are used to doing within that, which is great and we can take advantage of those, but something that is really going to change the way that things are done or potentially even open up new business models, you’ll find that we look for inspiration outside of Schroders’ walls.
C. d. R: With the 250 years of evolution, it sounds like you have always had this mandate from your leadership to be innovative, which clearly is still the case today, but I would love for you to share with us and the viewers on how exactly they support it? It might be that some of our listeners take out these lessons from our conversation.
C. W: I totally agree that senior leadership is absolutely crucial. We’ve been very lucky that our CEO is absolutely crucial both in the press and also internally when he is talking about our need to do things differently and constantly improve and innovate. That filters down then to his senior leadership, and they are the ones who we need strategically to tell us where the problem areas are and what opportunities we have to really change the way that Schroders work. Obviously when we arrived some business areas were much more on board than others.
For example cybersecurity – that is an area that is moving so quickly, that they were aware that to be defending yourself properly, you need to be working with the most cutting-edge start-ups. Whereas there are other areas of the business where perhaps hasn’t been so fast-moving in the past that it takes more effort to persuade them than it takes the time to look externally.
C. d. R: As we’ve gotten to know each other, Charlotte, one thing that has really impressed me is your ability to understand how technology has the ability to harness the collective brainpower of an organisation to broadcast out the problem statements to those ecosystems to get back both radical, new, disruptive and incremental ways to solve those problems. Can you talk to me a little bit about how you adopted technology and how it is working for you?
C. W: We really recognise that there is a lot of expertise and great ideas amongst the organisation, however, it’s hard for people to always know where to take the idea they have: sometimes they’ll take it to their line manager, but the line manager won’t always know what to do about it, so we wanted a centralised platform where people could suggest ideas either about what they do on an ongoing basis as a part of their role, or in response to specific business challenges that are leadership-consent, which again, employees can use to post ideas, comment on ideas and vote as well. This gives us a really transparent view of what people are thinking within the company. And it is also great for us providing feedback on the ideas, as everyone can see what happens to the idea – why they are being taken forward or not taken forward, which encourages people to continue to participate.
C. d. R: I understand that you run an annual innovation challenge, which essentially is a Hackathon.
C. W: We didn’t call it a hackathon, cause we didn’t want to scare people off with a tech-savvy name, but we meant to have it opened up for the entire organisation, we do keep it open-ended although we do set some business objectives around it, then we shortlist those ideas down to the finalists. The finalists are then put into teams and work on those ideas intensively for a couple of days before pitching what they’ve come up with to some of our senior leadership.
C. d. R: The exciting thing about hackathons is what comes out of them, and I know you are now in a fortunate position of actually having something that is now live and being used by the business – can you tell us a little bit about what idea that was, who it came from and how you built it?
C. W: Yes, we do. And probably my favourite idea that came out of the hackathon is now called Schroders Go. It was an idea suggested by a team out in Asia in Singapore, and it is a chatbot for our distributors to use. it sits on Facebook messenger and they can ask it any questions about funds, for example about Schroders funds and also other businesses’ funds. It will go out and find the information, pulling it out of sources like Morning Star and give it back to them in a conversational experience.
C. d. R: When I first met you, Charlotte, we ourselves were on a programme called Momentum, and they invited you to come and speak on open innovation, and your talk was fascinating. Can you talk a little bit more on what open innovation means to you and why it’s so important?
C. W: When I talk about open innovation, I really mean our collaboration with start-ups. I think it’s so important as there are so many start-ups coming into existence all the time: either focused on a really interesting technology question or often they come out of industry knowing the problem that they need to solve and have built something entirely around that. At Schroder we have a lot of great people internally and we can build a lot of these solutions ourselves but whether we should or not is a completely different question. Also, I think a lot of these start-ups coming into existence are exploring a new business model and testing our new client segments, new ways of working, new markets, and we can learn a lot from them – either just from observing them and helping to inform our strategy or actually collaborating with them and learning something from that partnership.
C. d. R: Completely agree with you. And your program, Cobalt, is putting this practise into reality. Can you tell me a little bit about start-ups that have been part of Cobalt so far?
C. W: Yes, Cobalt is our early-stage start-up programme to give them whatever they need, so it might be some product feedback – to add some features to the product that we need to have in place, or it might also be a mental shift from a different part of Schroders, e.g. legal, if they don’t have a legal framework in place or procurement to work out their pricing strategy. So we try to get them there as fast as we can so that we can see the benefit in working with them, and we learn a lot from them on the way as well.
In terms of the companies that have been on the programme, the first alumni are a company called Quill messenger, who have a secure chat application. It’s kind of like Whatsapp for business. For example if a wealth manager wants to interact with our client, we can’t use Whatsapp for a number of reasons – the regulator would be very unhappy with us. And Quill gives that whatsapp experience and allow you to have those quick exchanges that you might usually do via text or Whatsapp, while having something that is more secure than email. They can send documents and have individual conversations with clients. And we at Schroder’s will have access to all of that information if we need it for audit purposes as well.
C. d. R: I want to thank you, Charlotte. I think you’ve been absolutely brilliant today and super informative too – thank you so much!