At a Future Finance roundtable, our Strategy Director Giles Colborne and other senior leaders shared insights on driving successful change in financial services. The discussion was particularly relevant as the government pushes regulators to remove barriers to innovation and growth.
"Lots of change, lots of pain!" That's how one Credit Union CEO described their five–year digital transformation journey at a recent Future Finance roundtable. It's a sentiment that will resonate with many financial services leaders – especially as the UK government signals the most significant shift in regulation since 2008.
The Chancellor's recent call to "tear down regulatory barriers that hold back growth" and demand for a "cultural shift from excessively focusing on risk" signals potentially significant changes to the financial services landscape. But for senior leaders who've experienced the complexity of change in financial services, it also raises crucial questions about delivering transformation in what could be a rapidly evolving landscape.
The complementary roles of emotion and rationality in change
One key question was on how to get stakeholders to buy-in to change: was an appeal to emotion or reason more powerful? Giles recalled how a Chief Finance Officer reacted to seeing real customers struggle with his company's website. He still wanted a business case, but this experience was what made him an advocate for change.
Contrary to popular belief, a lack of emotion can actually impair decision-making. Neuroscientist Antonio Damasio's research shows that emotion plays a fundamental role in decision-making – his studies of patients with damage to emotional centres of the brain revealed they struggled to make even simple choices, despite maintaining their analytical capabilities.
However, the speakers agreed that while emotion often sparks change, rational analysis is also needed to ensure its success. Good business cases are essential to ensure efforts focus on changes that will deliver commercial value. As one leader noted, "The numbers have to work – is this going to pay back?". More rigorous analysis helps:
- Prioritise initiatives that will have the greatest impact.
- Identify and mitigate potential risks.
- Create clear success metrics.
- Build wider stakeholder confidence.
This creates what one panel member called a "virtuous circle" – where emotional buy-in helps push through challenging analysis and initiation phases, while clear evidence of progress helps maintain emotional commitment to change.
Interestingly, the FCA's Consumer Duty demands this dualistic approach – requiring firms to both understand customer needs (the emotional, human element) and demonstrate they're delivering good outcomes (the rational, analytical element). If regulatory relaxation leads to new opportunities for innovation, this dualistic approach will remain crucial.
Giles shared how Sopra Steria Next puts this into practice:
“First, we spark change by getting executives to see and hear from customers directly - whether that's watching research sessions or meeting customers to understand their challenges first-hand.”
“Then, we back it up with solid numbers - turning what we’ve learned into business cases that show the potential return, highlight risks, and meet both commercial and regulatory needs”
Beyond the side desk: Prioritising innovation
The roundtable leaders agreed about the need for real commitment to funding and resourcing change: change can't be a side project. When organisations ask people to fit innovation around their daily work, it sends a message that change isn't a priority. More importantly, it fundamentally undermines their ability to deliver.
And it's not just about signalling intent. The speakers highlighted how teams and individuals delivering change need protected time and space to succeed. This means:
- Dedicated time free from business-as-usual distractions.
- Mental and physical space to think deeply, execute effectively, and learn from results.
- Psychological safety to try new things without fear of failure.
- Consistent routines that enable proper planning and sustained momentum.
Research from the American Psychological Association shows that switching between tasks can reduce productivity by up to 40%. Harvard professor Amy Edmondson's research into high-performing teams, identified psychological safety as a fundamental requirement for innovation, enabling teams to experiment, learn, and adapt without fear of failure. This was echoed by Google’s research into team effectiveness.
Colborne noted: "The firms we see succeeding at making change happen are the ones that dedicate resources to it, not asking people to do it in their spare time."
Managing resistance through understanding
Another topic that generated significant discussion amongst the leaders was how to handle resistance to change. A crucial insight emerged: resistance isn't an obstacle to overcome, but a resource to embrace.
One panellist shared how their initial approach of top-down mandates failed to deliver sustainable change. Success came only after shifting to a more collaborative approach, noting: "You need to find ways that people can still find purpose and provide value in the new world."
When treated as valuable feedback, resistance helps identify real risks, uncovers hidden complexities, and reveals important aspects of existing processes that need to be preserved. However, when organisations treat pushback as opposition to be defeated, they miss these valuable insights. More importantly, they risk alienating the very people whose support they need to make change successful.
The speakers highlighted how this approach requires more than just gathering and documenting issues. It needs to surface, acknowledge, understand and respond to concerns in a meaningful way. This means:
- Early and active engagement to identify potential issues.
- Listening to understand rather than immediately counter-arguing.
- Understanding cultural context and existing ways of working.
- Addressing concerns raised directly when planning for change.
- Supporting people to find purpose and value in the ‘new world’.
Ford and Ford's research into change and resistance shows how apparent opposition often contains valuable insights about risks and implementation challenges. Their research identified that organisations which effectively engage with resistance early in the change process identify critical issues that might otherwise be missed. For financial services firms balancing innovation with the complexity of their systems and risk management, this early engagement becomes even more critical.
Giles shared findings from Sopra Steria Next’s study of 250 large firms: "The successful ones listen to their experienced people. They see resistance as valuable feedback and help their teams adapt to new ways of working."
Leading change in a new regulatory landscape
As Giles commented at the event, organisations often overlook a crucial reality: “the cost of not changing can far outweigh the cost of change itself”. Yet these hidden costs rarely factor into risk evaluations, creating what one speaker called "unhelpfully biased assessment systems".
The Chancellor's call for regulatory reform could create a unique opportunity for Financial Services in the UK. But as the roundtable discussion revealed, successfully delivering change requires more than just regulatory freedom. It demands:
- A combination of emotional engagement and analytical rigor
- Dedicated time and space for innovation teams to operate effectively
- A collaborative approach to resistance that turns it from barrier to asset
These insights become even more critical as financial services leaders navigate what promises to be a period of significant transformation. The organisations that will thrive are those that can balance the drive for innovation with the complexities of financial services – maintaining stability and managing risk while delivering meaningful change.
Even experienced leaders benefit from fresh eyes and independent voices during times of change. External partners can help spot opportunities, challenge assumptions, and provide insight into what has worked elsewhere. This becomes invaluable when navigating transitions, where an external party can offer an outside perspective, help facilitate alignment and provide flexible expertise on demand.
If you're leading change in your organisation and would like to explore these and other ideas further, we'd be happy to share what we've learned. Contact Giles Colborne – Strategy Director, Sopra Steria Next