Pressured by growing customer expectations and the need to modernise systems, the banking and capital markets (BCM) industry is at a critical juncture. Many banks are turning to cloud for rapid service delivery and increased agility, and those that execute well-planned cloud strategies and have the right skills in place can benefit greatly.
This paper explores the challenges facing BCM companies today, how they can benefit from cloud and the steps that are crucial for taking advantage of what cloud has to offer. The focus is on the importance of building a business case and knowing what is required to execute a cloud strategy that delivers the scalability, security and simplicity that come from doing Cloud Right™.
The challenges of the new digital world
The past decade has seen a radical transformation in financial services. The COVID-19 pandemic has increased customers’ appetites for digital-first services, and startups with disruptive banking technologies make the marketplace even more competitive. Disruptor scale-ups are using born-in-the-cloud and mobile-first technologies, combined with product engineering operating models, to transform how we engage with our financial institutions and shaping our customer journeys.
Even as the industry quickly evolves, many companies remain stagnant. Traditional financial organisations are held back by the complexity of legacy systems and the high cost of change; they have failed to transform their operating models and significantly reduce their technology costs. Consequently, their potential for improving business performance is massive.
Many BCM companies have nonstandard and inefficient processes that are tied to existing infrastructure and disparate applications. These contribute to deployment times of months, if not longer, for initiatives such as new digital-first applications — ultimately decreasing return on investment. That’s in contrast to the cloud, where companies can leverage new financial industry innovation to make bigger leaps faster. Maintaining rock-solid security and avoiding data loss are ongoing, if not heightened, challenges, along with acquiring the right skills in a tight labor market. Companies also need to bolster their environment, sustainability and governance (ESG) capabilities to stay ahead of regulatory expectations, strengthen public trust and demonstrate that they’re adopting social priorities.
High on the to-do list of many BCM business leaders:
- Kick-start stalled workload migrations while reengineering business processes to harness lower-cost technology enablers
- Accelerate the variability of technology costs and enable consumer pay models to align cost with business value creation
- Expand productivity gains through deeper automation and operating model transformation
- Minimise the amount of time from ideation to customer first use
The good news is that the successful execution of a carefully planned cloud strategy can help solve many of the technology and business challenges facing BCM companies today. The hard part is convincing decision makers of the business benefits of cloud, crafting a workable and realistic strategy, and getting all the pieces in place to execute it.
About the authors
Andy Haigh is head of Banking and Capital Markets, EMEA, at DXC Technology. He has over 20 years of experience in the banking industry and leads the company’s vision for financial services in the EMEA region.
Jay Hibbin is a customer executive, Cloud Practice, at DXC Technology. With more than 20 years of industry experience, he is passionate about building solutions that enable digital transformation and developing partnerships that result in successful business outcomes.