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At year-end, consultants sell big-picture «visions» for the next decade. But how accurate were the same augurs ten years ago with their forecasts? finews.com mines the archives.

Consultants earn big money putting banks through their paces to get future fit. One ubiquitous firm literally clocks time – once via stopwatches, now on a smartphone app – to discern billable hours.

At the moment, most spread doomsday scenarios: McKinsey warned banks to do or die (presumably unless one hired McKinsey to advise on how not to die, as one commentator noted archly). How precise were the decade-ahead predictions of major consultants at predicting the financial services industry of 2020? finews.com takes a selective look back.

Banking «Avatar»?

In 2008, as the financial crisis unfolded, KPMG suggested finance executives would be accompanied by «avatars» which would have daily sales and profit figures at the ready, flag potential problems. The 2008/09 crisis shifted priorities – and the avatar scenario didn’t pan out.

Two years later, BCG predicted that blue-chip corporate banks would emerge. They would be the jewels in the crown of universal banks for their long-term profit growth, great risk management, and value-added stance.

Banks would build extensive digital tools for banking services, making it harder for clients to switch between providers. What BCG didn’t anticipate is that banks would spend more money on regulation than on updating their technology.

After-Crisis Outpour

Forecasters failed to predict that the post-crisis generosity of central banks would last for a decade. The move has massive implications for banks. It has also shunted topics like reshaping outdated legacy systems and deepening data and analytics into real-time systems to the back burner.

Digitization has been a consulting buzzword for years. The axiom coined by Bill Gates in 1996 – «We always overestimate the change that will occur in the next two years and underestimate the change that will occur in the next ten» – proved true.