This Week’s 5 Must-Read Stories You May Have Missed
Monzo hit with a data breach, HSBC’s chief executive resigns and Rolls-Royce signs £350m contract with the Ministry of Defence.
We caught up with our columnist, business transformation expert, author of The Interim Revolution and founder and CEO of Sullivan and Stanley, Pat Lynes, to discuss the biggest news stories you wouldn’t have wanted to miss last week.
1. Monzo hit with a data breach
Digital challenger bank Monzo urged its customers to change their pin after nearly 500,000 of its users were hit by a data breach. The startup bank revealed that it had incorrectly stored some of its users pin insecure log files that could have been accessed by Monzo engineers for more than half a year.
This isn’t Monzo’s first data breach, after admitting in July 2018 that 200,000 of its customers’ details had been lifted from a third-party survey company, Typeform. Now faced with two data issues which have hit a large portion of its customers, does this mean customers will soon return to the comfort and experience of traditional high street banks? I don’t think so. The offering Monzo presents, as well as the way it positively treats its customers, means that incidents such as the recent hiccup, cause little outrage (in comparison to the traditional banks) and are quickly forgiven by its users.
2. HSBC’s chief executive steps down
All eyes are on HSBC after its chief executive, John Flint, stepped down due to the bank needing a different approach to tackling “the increasingly complex and challenging global environment”. Although HSBC presented strong results in its latest quarter, it appears to be struggling with the growing financial risks and disruption across the business. Following its earnings call the bank also revealed it will be cutting 4,700 jobs across its 237,685 global workforces.
It is clear that HSBC is currently going through a turbulent time, so it is especially important to have the right people at the top leading the change. There is speculation that Flint left due to a misalignment with board members, however, leaders are expected to present new approaches, so cannot be wholly agreeable with the board. There needs to be a level of diversity in mindset, which challenges the usual way of thinking to create successful solutions to these complex problems.
3. Rolls-Royce signs contract with the Ministry of Defence
It’s good news for Rolls-Royce as it returned to profit after signing a £350m contract with the Ministry of Defence. The British luxury car brand has secured repair and maintenance to the engines of the UK’s fleet of Typhoon fighter jets, which are the backbone of the RAF’s Combat Airpower. The contract, which is locked in until 2024, will support 175 Rolls-Royce jobs in Bristol and at RAF Coningsby in Lincolnshire and at RAF Lossiemouth in Moray.
The news followed Rolls-Royce’s half-year results, which uncovered an £83m profit, in comparison to a loss of £747m in 2018. It is the first time that the company has made a profit since implementing its structuring programme, so it’s positive to see the business now moving in the right direction.
4. Disney’s third-quarter profits miss expectations
Disney presented its third-quarter results last week, falling short of analyst expectations for both its earnings and revenue. In response, its shares dropped by 4% in after-hours trading. With the acquisition of Fox and investment in its new streaming service, Disney+, it’s no surprise to see its earnings miss the mark. It is clear that Disney is looking at the long game, investing in the areas where it has faced or will be facing disruption, to try and future-proof itself.
5. UK consumers up their online conception
The streaming revolution slows no sign of slowing down with the recent news that UK consumers spend more than £100m a week on digital entertainment services. According to Entertainment Retailers Association which published the figures, UK consumers spent £3.3bn on entertainment products and services such as Netflix, Amazon, Spotify and Apple Music. The biggest area that saw growth was the entertainment sector of digital video, films and TV shows, which are across services such as Netflix, iTunes and Sky Store, which increased by £130m in comparison to 2018.