Managing Innovation in Westpac: Strategies and Implementation

This report provides an in-depth analysis of how Westpac, a leading Australian bank, manages innovation. It begins by highlighting Westpac's involvement in innovative initiatives like Pay ID and its partnerships with fintech companies. The report proposes an electronic ticketing product to align with Westpac's portfolio management goals and digitization efforts. Key aspects of innovation management discussed include design thinking, emphasizing user involvement, fast integration for cost and time efficiency, prototyping and testing capabilities, and the importance of cross-functional management. The report concludes by considering the potential impact of future innovations on the proposed electronic ticketing system. The design thinking process is explained, detailing empathy, definition, ideation, prototyping, and testing. User involvement, fast integration, prototyping, and cross-functional management are examined to show their significance in successful innovation. This document is available on Desklib, a platform offering a range of study tools for students.

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Managing Innovation in Organization
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Executive Summary
Westpac is among the leading banks in Australia. Westpac plays a key role in promoting
innovations in the country. This research paper focuses on ways to manage innovation in an
organization. In the introduction, a few examples of some of the innovations Westpac has been a
part of is given. The section also includes an idea of an innovative product that is based on
Westpac’s goals and its portfolio management. A brief overview of how our innovative product
will be streamlined with the organization’s current capabilities is also given in this section. In the
next section, the steps involved in design thinking are attached. A table for the same is provided
in the appendix. Secondly, the role and importance of user involvement in innovation are
described. Thirdly, a brief understanding of how fast integration helps save on costs, time and
resources in innovation is provided. Fourthly, a description of how prototyping and testing
capabilities are done is given. Finally, the importance of cross-functionality management in
innovation is described. In the conclusion section, a discussion of how future innovations may
affect our innovative idea is given.
Table of Contents

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Managing Innovation in Organization.........................................................................................................3
Introduction.................................................................................................................................................3
Design thinking........................................................................................................................................5
User involvement....................................................................................................................................6
Fast integration- time, costs, resources...................................................................................................7
Prototyping and testing capabilities........................................................................................................7
Cross-functional management.................................................................................................................8
Conclusion...................................................................................................................................................8
References...................................................................................................................................................9
Appendix...................................................................................................................................................11
Design Thinking Diagram.......................................................................................................................11
Managing Innovation in Organization
Introduction
Westpac is a bank headquartered in Sydney, Australia that offers financial services. Innovation
refers to the action of applying new ideas with the aim of generating value for an institution. The

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world the Company is operating in is changing rapidly (Bagno, Salerno, & Carneiro Dias, 2017).
Structural shifts in the economy, changes in demographics and technology are creating both
challenges and opportunities for businesses globally. Innovation is at Westpac’s heart’s goal of
becoming among the leading service-providing companies in the world (Westpac Banking
Corporation, 2017).
Westpac has some hot topics regarding innovation which include pay ID. Pay ID is an
application that will facilitate quick payments through a client’s phone number. Pay ID will
prompt almost instant transfer of funds between authorized accounts. Pay ID will make it simpler
for clients to pay you as it enables easier communication of bank details among people through
one’s phone number. Pay ID will enable payments to be done in a simple, smarter and real time
manner 24/7. Westpac is making principal investments in new businesses to open up innovative
opportunities for progress, provide technological ability and resolve strategic challenges. For
instance, Westpac has partnered with Vincent Turner, an entrepreneur, to support a digital
mortgage broking service known as Uno. Uno lets mortgage clients to broker their individual
home loan (Tarasyuk & Koscheyev, 2017). The collaboration offers an opportunity for driving
innovation in customer involvement and experience (Yu & Rhee , 2015). The collaboration will
change the process that is driven by a lot of clunky paper work into one that is digitally enabled.
Westpac is greatly involved in supporting innovation in Australia. Westpac is the foundation
companion of the biggest fintech center in Asia, Stone & Chalk (Yang, Toorn, Thorogood, &
Vlasic, 2015). Stone& Chalk aids start-ups to materialize and scale over the partnership with
huge establishments internationally. Currently, Stone & Chalk houses over 300 entrepreneurs
who work for over 80fintech start-ups who through funding have raised over AU$100 million
collectively. The Westpac scholarship program offers over 100 fellowships and scholarships

MANAGING INNOVATION IN ORGANIZATION 5
annually as a way of investing in the next generation of leaders (Raghunathan & Maiya, 2017).
Westpac believes that the best way to support Australia’s advancement is to invest in ambitious
investors, the bold reformers and the gifted visionaries. The scholarships are centered towards
digitization, innovation, and technology of everyday life as well as in creating positive societal
transformation attained through communal entrepreneurship.
Westpac’s goal is to be a leader in offering personalized and diversified portfolio management
solutions to its clients. An idea that can be used is the development of an electronic ticketing
product. This is intended to help commuters using public transport to pay their bus fare through
the app. Public transport providers will partner with Westpac. The application will allow funds
transfer from the customer’s account to the service provider accounts. The idea also involves
issuing of prepaid cards to clients and Android devices to the transport providers. Clients only
need to load money into the cards from any Westpac Bank branch and tap on the device to pay
their bus fare.
The idea will be streamlined in Westpac’s innovation capabilities in the following ways. The
electronic ticketing idea is in line with Westpac’s goal of improving customer experience
through digitization. Westpac’s capabilities include offering safe and secure products. The
electronic ticketing is a secure way of making real time bus fare payments conveniently.
Westpac is aiming at either meeting customer needs while building its profits. Westpac may
partner with innovators in a bid to increase their profit margins (David, Clutterbuck, &
Megginson, 2016). There is a need to be a cashless society in all sectors. Introduction of this
application and prepaid cards will aid in meeting consumer needs. Among Westpac’s innovation
capabilities is incubation. Once the idea is pitched to Westpac, they take it to the market and test
it to find out the reaction of consumers. Customers are able to give feedback on their take on the

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innovated product. Westpac then needs to analyze their ecosystem and find out if they have the
required personnel and skills to drive the product. They need to analyze if the required tools and
processes are in place to drive the idea. Westpac is capable of offering training and advice on
how to improve the product and make it better. The developers of the ticketing application will
utilize Westpac’s cloud-based advancement capabilities and prototyping tools while developing
the application.
Design thinking
Design thinking entails developing a systematic approach to solving problems (Curedale, 2013).
It entails understanding the needs of the product. In the case of the ticketing platform the
development team is trying to solve the need of using cash to pay bus fare. Firstly, the team
would consult experts from both the transport and banking sectors and pitch the idea to them.
The team shall also conduct research from users of public transport on their view about the
product. This will build on empathy so as to understand their need and experiences while using
public means. Secondly, the team shall now define the problem statement after having put
together all the information gathered on consultation. This will enable the stakeholders better
understand some of the elements and features to include in the ticketing application. Thirdly, the
development crew will now need to ideate in a bid to find a solution to the problem identified.
Brainstorming and analysis of the worst case scenarios are the main techniques to use (Plattner,
Meinel, & Leifer, 2018). Ideation enables identification of as many solutions as possible for any
issues that may arise regarding the use of the application or the prepaid cards. Fourthly, the crew
will need to develop prototypes which team members can use to test their viability. This involves
developing the app and issuing it to a number of commuters and bus conductors to use and share
their experiences. This is intended to identify any constraints or problems inherent in the product.
Based on the feedback they give, the product may be improved, modified or rejected. Finally,

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when conducting design thinking the team needs to design the complete product and test it.
Directions for use are issued at this stage.
User involvement
User involvement entails the involvement of the intended users of a product or service in its
development (Edvarsson, Gustaffson, Kristensson, Magnusson, & Matthing, 2014). The main
parties involved in the ticketing platform are the commuters, conductors, and the bank and public
transport service providers. User involvement is vital to enhance successful system
implementation and ensure system quality. User involvement in the development cycle ensures
that the developers get all the information they need regarding the application. Despite the
process of user involvement being costly and time-consuming, it is worthwhile as valuable input
is offered regarding decisions being made about the product. User involvement is related to the
quality and usage of the application, attitudes of the users regarding the application and their
satisfaction with the output they get from using the application or the prepaid cards. User
involvement enables the application to be tailored to meet their needs and the lead users gain a
better understanding of the application. User involvement enables inventors to get easy and fast
approaches to shaping features into menus (Smith-Jensen, 2011). User involvement allows the
system designers to understand and know the user's lexis so that they can communicate using a
similar language (Eichhorn, 2014). User involvement of all stakeholders should be thorough
since insufficient user involvement results in underperformance once the application has been
made available to the public.
Fast integration- time, costs, resources
Fast integration is required when developing applications aimed at automating business
processes and delivering timely services to customers. In our product, integration will involve
connecting the bank's systems with those of the public transport service providers. This is crucial

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since all of them are connected to ensure the success of the application. Fast integration ensures
timely response of commands and eliminates duplication (Berggren, 2017). Increased demand
for the application will require an addition of new resources to meet this demand. Different
databases will need to be integrated to ensure that the application performs effectively. All this
require some capital. User involvement is crucial as it is in minimizing costs, in that the
designers do not waste resources producing products that the final consumer do not need. Cloud
services enable organizations to integrate or link their applications making business processes
simpler and automated (Yee & Oh, 2014). Integration enables fast and timely delivery of
services to the market. Involvement of the key users in the development of the application will
enable the integration to be done in a timely and cost-effective manner (Saugstrup, et al., 2008).
Prototyping and testing capabilities
Earlier in the application lifecycle, it is important that the developers take their applications on
test drives. Prototyping is aimed at eliminating barriers to rapid development and iteration.
Prototyping enables approval based on feedback received so that the development of the
application can continue. Prototypes often act as objects to be learned from or replicated.
Prototyping is vital as it avoids production of poor quality products, over budgeting, and other
pitfalls. Prototyping tests the context and content of the user interface as well as its core
functionality ( Chua, Leong, & Lim, 2010). The stakeholders who are involved in the entire
development process require prototyping to be done so that they can clearly understand and
approve the design of the ticketing application and before coding and execution is done. The
developers chose to use mockups as their prototyping technique since it is relatively fast, has
medium fidelity and allows for collaboration, sharing and usability trials among the stakeholders.
There exist mobile prototyping applications that allow for real-time device testing. Prto.io is an

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instance of a mobile prototyping application the team shall use. Mobile prototyping applications
enable developers to focus on ingenuity and creativity (Hacker, 2013).
Cross-functional management
Cross-functional management entails the management of a team who have different
functionalities in their expertise but they all are working towards the attainment of the same
objective (Porth, 2011). In the case of developing our application, the expertise of bankers,
system developers or designers, the clients among others is needed. Cross-functional
management discovers the effects of job rotation, process standardization and technical support
on the development of a new product. While job rotation and technical support influence the
speed of developing the new product, process standardization and job rotation influence its
quality. Cross-functional management also entails the integration of success factors, processes,
and principles associated with a collaborative organization. In the development of the
application, various stakeholders are in the ongoing development process. Cross management is
crucial as it differentiates between managing outcomes and resources in the development process
and appreciates the prospective efforts of collaborative management (Bugdol & Jedynak, 2015).
Cross-functionality management discusses how various approaches may be instituted to ensure a
positive outcome of the end result.
Conclusion
The application may not be suitable for all and the prepaid cards may not be as secure and they
are bound to be misplaced. New innovations regarding other options of paying bus fare may thus
ensue. An example is the use of compatible mobile phones. The phones have a technology
known as the Near Field Communication (NFC). With this product, commuters will just need to
tap their handsets at LRT and MRT fare frameworks and also on card readers located in buses

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(Subtil, 2014). Innovations will need to be done to develop mobile phones that support this
technology. Commuters will need to purchase these phones as well as NFC SIM cards so as to
enjoy the service. They will require to turn on the NFC function so as to make their payments
and also for top-ups (Ahson & Ilyas, 2016). The service will not only allow commuters to make
payments but also allow them to make payments in outlets.
This payment system may affect our innovation of the ticketing app in that it will cause stiff
competition. The SIM card is not only limited to make bus fare payments but it can also be used
to make payments in food and other retail outlets as well. However, the ticketing application is
only suited for use to make bus fare only. Therefore, this may pose a threat to this product as
consumers may prefer the diversified product.

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