The quintessential American inventor, Thomas Edison, once said, “To invent, you need good imagination and a pile of junk.” There’s a story, perhaps apocryphal, that he paid employees to bring in unusual items for his laboratory’s inventory, in the belief that someday something might be the key ingredient of some invention.
Where can bank innovators find the raw material for their “pile of junk”? After all, it’s hard to think of much that lumps of carbon or bamboo filaments — key parts of two important Edison inventions — could do for a savings account or a mobile banking app.
For Don Relyea and Todder Moning of U.S. Bank’s innovation team, one of the places to find useful bits and pieces is the annual Consumer Electronics Show, which takes place in Las Vegas every January.
“I liken the innovation process to surfing. You’ve got to start paddling, waiting for the waves to be there. If you don’t, the waves are going to start to pass you by, because you’re kind of flat-footed.”
— Todder Moning, U.S. Bank
The vast trade show — CES 2023 boasted more than 3,000 exhibitors — showcases advances in electronics, transportation, sustainability, the metaverse and more.
Here’s what U.S. Bank’s innovation team found interesting and inspiring.
What ‘Drone Nests’ and Smart Mirrors Have to Do with Banking
Multiple vendors demonstrated rooftop landing facilities — called “drone nests” — for delivery drones and other pilotless commercial aircraft.
Like other electric devices, drones have batteries that need to be recharged and sometimes they simply need a place to park overnight.
A few vendors took the rooftop docking stations to the next level by offering “garages,” some outfitted with QR codes that drones could use to self-authorize payment for their shelter and recharge.
Doesn’t seem much like a banking product, does it?
It does to Moning, head of applied foresights at U.S. Bank. He says this is an example of how bankers can assemble their own “pile of junk.”
Exposure to ideas like drone nests “gives us the fodder, the raw material, that helps us when we start thinking about future scenarios,” says Moning.
As he describes how seeing the drone nests sparked a brainstorm of his own, it conjures a picture of a Rubik’s cube inside his head.
Click. “A company needs a fleet of drones. There’s a leasing and financing opportunity there.”
Click. “There’s a fleet of drones. That gets us into fleet management services and fleet payments.”
Click. “And U.S. Bank has a bunch of real estate. We’ve got branches that sit within 10 miles of millions of people.” That’s a lot of rooftops that could have drone nests on them earning fee income.
There might be more “clicks” yet to come, but you get the idea.
It’s much the same thinking Relyea, U.S. Bank’s chief innovation officer, had at CES 2023 when trying out a mirror equipped with artificial intelligence. It assessed the user’s skin and suggested treatments.
“That’s a point of sale right there,” says Relyea, who sees the mirror as another device where U.S. Bank could be providing payments services in the background. “Embedded financial services is part of the future for us.”
Says Moning, only half-joking: “It’s kind of weird to think about how do you do ‘Know Your Customer’ due diligence on a machine?”
Yet as the inventory of “smart” devices grows — the U.S. Bank team also saw autonomous lawn mowers and snowblowers on display at CES — that’s not an idle question.
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Banking Connects to Everything (Eventually)
U.S. Bank has been sending employees to CES for years, and when they return, the task of brainstorming spreads.
“When you take things back to the rest of the innovation team whose job is thinking and getting excited about new technologies, it’s very inspiring,” says Relyea. “They’re going to come up with things that are inspired by other industries that are leveraging tech trends, but more related to our bank’s bread and butter.”
Not everything jells.
“You take a little of this, a little of that, shake it up, and maybe you’re like, ‘Wow, that’s really cool,'” Moning says. “Other times you do all that and you’re like, ‘Wow, that tastes horrible.'”
De-briefing Relyea and Moning after the team’s visit to CES 2023 not only offers insight into emerging trends apparent from the thousands of vendors that exhibit there, but a better understanding of how the fifth-largest bank in the country orchestrates its innovation efforts.
One of the immediate payoffs for U.S. Bank is a series of presentations pulled together from the CES visit for other parts of the bank, to talk about what’s going on in the market, where things are headed and how the bank might fit into it.
“We share the pictures, we share the stories and explain the significance of what’s happening,” says Relyea. “Our big remit in the innovation team is to do the innovation work and keep our lines of business ahead of disruption.”
Moning points out that the bank has more than 30 business lines, so there’s a lot of potential for finding future opportunities based on what’s seen at CES.
Exploring ‘Digital Twins’ and Other Unfamiliar Ground for Banks
The futuristic ideas shared at CES come from a wide variety of industries. Attending the show each year gives the innovation team the ability to keep track of what’s new, what’s ripening, what’s gone cold and what’s warmed up again, according to Moning.
Take QR codes. “They used to be a weird thing,” he says. “Now they’re everywhere.”
A concept of ongoing interest to Relyea is the principle of “digital twins.”
The idea is to create a duplicate of something in a virtual environment — like a machine, a process, or a body organ like a heart — to study how various factors would influence that thing in real life.
The process involves installing sensors on a real item, such as an airplane engine, and transferring the data to its “twin” in the virtual world.
At CES 2023, the U.S. Bank group — which also included Kari Shotley, senior product manager, and Andrew Cantrell, senior applied foresights strategist — experienced the digital twin of South Korea’s Incheon International Airport.
“They used artificial intelligence to create a digital twin to simulate everything from flight traffic to vehicle traffic on the tarmac to foot traffic within the airport space,” says Relyea, who was excited by the experience. “They then expose airport visitors to it through a mobile app. Let’s say you can’t find the Singapore Airlines lounge. You can engage with the app and it will give you a friendly little augmented reality robot who you can follow around on your phone through the airport to get where you need to go.”
What especially interests the team is the use of digital twins as a way to personalize customer experiences.
How can a bank apply this idea? “A financial digital twin would be everything you do that is financial, a virtual representation of financial you,” says Moning. “Who pays you, who you pay, where you invest, where your insurance is, the entirety of your financial relationships.”
This can begin to approach virtual reality, augmented reality and mixed reality, a particular interest for Moning. “Someday, you’ll have one set of glasses and you will be able to decide how much or how little of the real world you want to include in your view.”
This ties in with U.S. Bank’s view on the metaverse, which the team sees as being practical in roughly 10 years.
“What does it have to do with banking? It has everything to do with the idea that virtual economies in games and loyalty programs and the real economy will start to merge,” Moning says.
“It’s important for us to be working to understand those future economies and to create services for them,” he adds.
Moning believes the time for banks to be active in the metaverse will come in the 2030s to 2040s.
There’s More than Consumer Products at CES
The name of the conference doesn’t do justice to its scope. There were exhibits the group saw that are far removed from consumers, yet of potentially strong interest to U.S. Bank.
For example, makers of heavy earth-moving equipment and massive digitally controlled farming machinery were represented in multiple ways. U.S. Bank is one of the country’s top agricultural banks, making these exhibitors of prime interest.
“The number of people needed to work a farm keeps going down and down,” says Relyea. And now “farmers” don’t necessarily have to be on the farm to do major parts of the job. Autonomous tractors and planters were shown at CES, which also had stations where visitors could try out the remote controls for massive earth-moving equipment from Caterpillar. The “driver” sat at the Las Vegas exhibit hall, while the actual machinery doing the digging was in Peoria, Illinois, and Tucson, Arizona. Talk about the future of working from home.
Moning says such trends have been on the innovation team’s radar for a while. “Just a few weeks before the conference I gave a presentation on the trend, explaining to bank staff how autonomous vehicles weren’t ready to be on highways yet, but that there are some use cases where it is safe,” he says.
The sheer size of some of the equipment impresses Relyea. The tires alone on this Cat earth-moving truck were taller than he is.
For all the variety at CES, the event gets little participation from the financial services industry. Moning says that fintech companies, which typically make up just a small portion of exhibitors, had an even lighter presence than usual this year.
Understanding the Innovation Timeline
When reading about U.S. Bank’s latest “safari,” as Relyea likes to call it, bankers and credit union executives may be thinking, “But my boss expects instant results.”
Relyea points out that innovation in bank technology doesn’t always work so quickly.
“The development of voice assistants is a really good example of that,” he says. “It started 10 years ago.”
Today there’s U.S. Bank Smart Assistant, and plenty of rival voice-based products, but it was a long road. “The bank had to do a lot of testing and learning and failing,” says Relyea.
Moning adds that, pre-pandemic, voice control was all over CES, including some ways — like controlling barbeque grills by voice command — that he considered silly. But now voice is a natural user interface. The future might even include controls based on other senses.
But one that may take longer to catch on is smell. “Back in the day,” Moning says, “I saw a ‘smell printer’ that could emit the scents of sticky buns and hot dogs.”
That might not be coming to a branch near you anytime soon.