This paper will analyse digital disruption in the financial services industry, with a particular focus on banking, leveraging structured methodologies $-$ the STEP Model, Business Landscape, and Future Fit Strategic Blueprint, to assess potential threats and opportunities.

Question $2$

What is STEP Model Analysis:

The financial services industry faces continuous transformation driven by digital disruptors such as artificial intelligence $($AI$),$ blockchain, and fintech innovations.

The STEP Model is a strategic framework used to analyse and respond to digital disruptors in industries, even in financial industries. It helps organisations assess their market environment and develop structured responses to emerging challenges. The model consists of five key components:

Market Identifying major digital disruptors affecting the industry.

Strategy Conceptualizing how the organization should respond to these disruptors.

Tactics Implementing department$-$specific strategies to address disruptions.

Operations Operationalizing the response by adjusting workflows and processes.

Function Ensuring the organization has the necessary skills and knowledge to adapt.

The Step Model may provide a structured approach to identifying and responding to digital disruptors in the financial services industry. Below is an analysis of key disruptors and how such an industry may adapt strategically.

Step Model Analysis: Digital Disruptors in Financial Services

a$)$ Major digital disruptors impacting financial services include Potential Disruptors

Fintech Companies: What innovations are they bringing to the market? How are they impacting customer acquisition, pricing, and service delivery?

Blockchain and Cryptocurrency: How could blockchain technology disrupt traditional banking, payments, or investment management? What are the potential impacts of cryptocurrencies on the financial system?

Big Tech Companies: $($e$.$g$.,$ Amazon, Google, Apple$)$ What financial services are they offering or planning to offer? How could their vast customer base and data analytics capabilities disrupt the market?

Artificial Intelligence $($AI$)$ and Machine Learning $($ML$)$: How are AI and ML being used to automate processes, improve customer service, detect fraud, and make investment decisions? What are the potential benefits and risks?

Data Analytics and Personalization: How are organisations using data to personalise