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Firms are focused on increasing flexibility and reducing costs to drive efficiency

The­se were some of the key the­mes dis­cus­sed by Object­way with board mem­bers of over 40 Wealth Manage­ment and Pri­va­te Ban­king firms via a seri­es of face to face mee­tings at the recent Rich­mond Finan­cial Indus­try forum, Inter­la­ken, Switzerland.

Digitalisation has to be flexible

The tra­di­tio­nal ‘One size fits all’ approach has meant that firms have been unab­le to quick­ly pick and choo­se func­tio­n­a­li­ty which is best sui­ted to them. As result many firms do not have a modu­lar approach to their tech­no­lo­gy stack and feel that they are mis­sing out on value. For examp­le, many firms are loo­king to add a best of breed solu­ti­on for enga­ging with cli­ents in a digi­tal man­ner, such as improving/changing their cli­ent por­tal, impro­ving the onboar­ding expe­ri­ence. The front office want a more modern Port­fo­lio Manage­ment solu­ti­on in order to maxi­mi­se their pro­duc­ti­vi­ty and add auto­ma­ti­on so that less time is spent on admi­nis­tra­ti­ve tasks. Firms also want it to be easy to be able to faci­li­ta­te their cli­ents to tra­de new pro­ducts such as cryp­to­cur­ren­ci­es. With the cur­rent sta­te of this, hea­vy, infra­st­ruc­tu­re, chan­ge takes time, is cos­t­ly and the result may not necessa­ri­ly be mar­ket leading.

Howe­ver, modern IT archi­tec­tu­re allows for fle­xi­ble modu­lar solu­ti­ons to be inte­gra­ted to exis­ting sys­tems. The­se modu­les are spe­ci­fic and should have an edge ver­sus a gene­ral mono­li­thic sys­tem. Upgrades and added func­tio­n­a­li­ties should also be pro­vi­ded at grea­ter speed and the risk and cost of imple­men­ta­ti­on is also great­ly reduced.

Firms were very inte­res­ted in this approach and can see the bene­fits it will have on cli­ent expe­ri­ence, advi­sor pro­duc­ti­vi­ty and the lower risk of the chan­ge project.

Firms need to reduce costs as one way to drive efficiency:

Many firms are struggling with lega­cy sys­tems which are inter­con­nec­ted via com­pli­ca­ted patches. This ulti­mate­ly cau­ses gre­at inef­fi­ci­en­cy in pro­ces­ses as well as com­pro­mi­ses the inte­gri­ty of data. The cost of ‘kee­ping the lights on’ often sucks up signi­fi­cant resour­ces in order to cope with the com­ple­xi­ty. Inde­ed the nega­ti­ve cor­re­la­ti­on bet­ween IT spend and pro­fi­ta­bi­li­ty is one that firms are try­ing to over­co­me as they stri­ve for grea­ter effi­ci­en­cy and scale.

How can firms reduce costs?

One way is through auto­ma­ting manu­al pro­ces­ses. Iden­ti­fy­ing the are­as whe­re pro­ces­ses can and should be auto­ma­ted is a good start and may lead to a chan­ge in the pro­cess its­elf, i.e. eli­mi­na­ting dupli­ca­ti­on, by intro­du­cing auto­ma­ti­on tools such as RPA. This should have the impact of fre­eing up employee time for more value added/revenue genera­ti­on tasks. In par­al­lel or as an alter­na­ti­ve, firms should also look to sim­pli­fy their IT archi­tec­tu­re. This will invol­ve chan­ging to more modern modu­lar solu­ti­ons as men­tio­ned abo­ve. The out­co­me should lead to many lega­cy sys­tems being made red­un­dant as well as the high cost and manu­al pro­ces­ses asso­cia­ted with them.

The­re was a defi­ni­te appe­ti­te to make the necessa­ry chan­ges to enab­le fle­xi­bi­li­ty and redu­ce cos­ts. Firms were loo­king for the ide­al partner(s) to ensu­re suc­cess­ful chan­ge pro­jects in the near future.