Dr.Patrick Schueffel is a professor at the Institute of Finance at the School of Management Fribourg (HEG), Switzerland. His research interests focus on the areas of Entrepreneurship in Banking & Finance, Innovation, and International Business. I reached out to him to learn little we could from his vast experience.
How is your industry experience helping you transform your knowledge as a Professor at Institute of Finance at Hochschule für Wirtschaft Freiburg (HSW-FR)
I have crisscrossed the boundaries between academia and practice several times throughout my career. I find it incredibly inspiring to switch perspectives once a while. My industry experience helps me to interpret scholarly work and to figure out what is more relevant to the practical world of banking and finance and what is less. At the same time my practical experience allows me to translate academic findings into a language that is understood by practitioners so that they can make sense of it and use it to their advantage.
As a “Pracademic” I see myself as an interface between academia and practice. I strongly believe that both spheres need each other in order to find solutions to the many challenges we are facing today.
Give us some tips while working on strategy for Startups and Corporates?
First, one has to acknowledge that startups and large corporations are different types of animals for several reasons: they typically have different resource pool, unlike organizational structures, dissimilar processes and so on. Most importantly, however, they have different organizational cultures.
And as culture eats strategy for breakfast one needs to appreciate the corporate culture in order to devise a sound strategy. Ideally the corporate culture is assessed by hearing as many stakeholders of the firm as possible.
Once the necessary appreciation exists, however, formulating a strategy requires not much more than routine craftsmanship. Nonetheless, throughout strategy formulation and especially during implementation one has to pay a lot of attention to detail. This applies especially to large corporations where one cannot pursue a greenfield approach and even more so to highly regulated industries such as the banking sector.
Tell us about “Open innovation and banking – Ideal complement or stark contradiction”
At the School of Management Fribourg we conducted a study on Open Innovation in the banking industry. Our reasoning was that the headwind for banks was getting stronger and that banks would need to put more effort into re-inventing themselves.The Open Innovation paradigm assumes that firms should not only use internal stakeholders to generate ideas for innovations, but that they should also make use of external stakeholders, such as clients.Thus, Open Innovation suggests that the boundaries between a company and its environment become more permeable and that firms could thus easily source innovations from the outside.
To our mind open innovation is the ideal method for banks to generate desperately needed innovations as it allows them to tap into a vast pool of creative resources at very little costs.
Our empirical studies, however, showed that banks regularly still lack not only the necessary organizational culture in terms of risk tolerance etc. but also the needed openness to successfully apply open innovation. We therefore termed the outcomes of our study “Open innovation and banking – Ideal complement or stark contradiction”. And at the moment it is unfortunately still more of a contradiction than complement.
How is the startup ecosystem in Switzerland and how is the government supporting the same?
As far as my area of expertise, that is Banking and Finance or “Fintech”, in concerned, Switzerland has a rather sophisticated startup ecosystem. All necessary ingredients are in place to grow a striving Fintech sector: from angel and early-stage investors to venture capitalists and private equity funds to incubators and accelerators to cluster initiatives and regional projects.
Numerous meetings are regularly being held on Fintech startups and related topics from local Meetups to international conferences. Associations supporting Fintech firms have been founded and partnerships between incumbent banks and Fintech firms have been forged.
Academic institutions are heavily engaged in the technical side of Fintech research and business schools such as the School of Management Fribourg (HEG) not only conduct research on business side of Fintech, but also teach the economic principles underlying this new industry. In addition international links were tied to other Fintech hubs, for instance between the School of Management Fribourg (HEG) and the Level39 accelerator in London.
The Swiss government supports the rise of this new industry through various measure, most notably by adjusting rules and regulations as well as taxation where necessary and possible and through projects supported by its Commission for technology and Innovation. However, culture still hampers the startup-ecosystem as Swiss firms and consumers are typically not likely to be first-movers but prefer tried and tested solutions.
Your favourite books.
Oh dear, that varies over time. Until further notice those are my three favorites:
Animal Farm by George Orwell,
Island of the Lost by Joan Druett,
Strategic Management: Competitiveness and Globalization by R. Duane Ireland and
Robert E. Hoskisson
Your future plans.
I will continue to integrate practical and academic knowledge and thus continue to help shaping the future of banking and financial services.