Technological change and the electronic marketplace is one of the strongest forces driving the change in the
financial sector of the economy. However, it is not the only one.
One of the major forces includes globalization. Traditional barriers to cross-border financial services are coming down. A major driving force behind this trend is the liberalization process under the auspices of the World Trade Organization. An increasing number of countries are dismantling restrictions on entry and also adopting a more modern solvency-oriented approach towards regulation rather than detailed regulations on tariffs and products. A deregulated market attracts foreign competitors. In such a market, foreign competitors generally find it easier to take advantage of their specific competitive edges.
Singapore is a small market characterized by strong competition. The sophistication is high. Many of the large international giants are already here since many years () In order for local financial planning firms to survive they must remain competitive by doing things better, faster and cheaper. They will have to offer quality services to meet the changing needs of the increasingly demanding consumers and develop new products and services to meet their changing needs and new channels of distribution to reach out to them.
The other side of the internationalism process is that local firms can expand in the region.
Strategies for regional expansion may include:
(1) Exporting a firm�s champion products and services
(2) Bringing along its e-business infrastructure
(3) Bringing along its know-how in tapping a customer database to cross-sell products and
(4) Finding a local partner who can contribute an existing customer base and the local expertise.
More demanding customers is also driving the change in the industry.
Consumers are becoming more knowledgeable that they require more from the service provider. They will demand more customer focused products and services. Service providers must therefore make their products easier to understand and their value easier to calculate.
To conclude, the change in the financial industry would mean to say that successful business would increasingly be built on intangibles such as knowledge and ideas. Furthermore, the rapid changes introduce uncertainty. Local firms have to learn to deal with uncertainty, monitor results, adapt and learn. In other words, be a �learning organization�. There are virtually no limits on the new business opportunities presented by e-commerce. Local firms need to be sufficiently imaginative to exploit the new e-business technologies and sophisticated services in order to gain a competitive advantage. |
