FINANCIAL SERVICES SECTOR IN THE RACE TO EMBRACE TECHNOLOGY
Carsten Bruhn, Executive Vice President, Ricoh Europe
The European financial services sector is in a prime position to take advantage of technology innovation. A recent study of European business leaders found that the sector has made greater strides towards unlocking the ‘bigger data’ opportunity (the digitisation of business critical, hard copy documents for business decision making) than any other industry[i]. Separately, research firm Ovum recently announced in a new report that global IT spending is set to reach more than €70 million across the financial sector by 2018.
The future is undoubtedly digital. However today, leaders in the sector are often still faced with a myriad of challenges in driving their business forward and adapting to the digital demands of customers. While every industry must change if they are to grow into the future, financial services executives have some distinct barriers of their own to overcome. They are operating in a lean and highly competitive market, are often met with greater and more complex regulation and see widespread change due to economic destabilisation. While tackling these challenges, they also continuously strive towards delivering transparent, cost effective services that will increase their reputation and grow their customer base.
It is no wonder then that financial services leaders are feeling under pressure. Juggling many obstacles, while simultaneously trying to focus on client services, transform internal processes and ensure regulatory compliance is a monumental task.
Some of the effects of these competing factors have been expressed in newly released research from the Economist Intelligence Unit commissioned by Ricoh Europe[ii]. It was revealed that just one in ten financial services leaders across Europe believe they can rapidly take advantage of new opportunities ahead or adapt to unexpected changes in the future. And while many (54 per cent) said they have numerous ideas to tackle future change, they admit, more than any other industry surveyed, that they lack the ability to execute their ideas well.
As technology-led change continues it is essential that financial services organisations are able to embrace innovation and realise ideas for change, while not feeling restricted by its need for compliance and security. From our conversations with financial services clients we’ve found that one of the biggest barriers to increasing the speed of change for greater business agility are process related. Research2 also confirms it – financial services executives rank bureaucratic decision making processes (47 per cent), effectively linking technology platforms (40 per cent) and insufficient access to information (35 per cent) as the most obtrusive barriers to business agility. That is not all. There are also additional hurdles to optimising core business processes. Poor governance of change management is ranked as the most obtrusive, followed by time constraints on executives and legacy technology platforms.
By reviewing and changing from traditional ways of working to more efficient, streamlined and digital processes, financial services leaders can turn perceived risks into benefits for their organisation and increase the rate of change while meeting client needs, remaining efficient and minimising risk.
They can relieve some of the stress by drawing on more expertise to drive internal change programmes that will successfully result in new ways of working. They can also further employ customer communication management services to enhance client relationships. And while these critical processes are being optimised, leaders can invest more time and resources in core business activities and guiding their organisation into the future.
With their competitive edge, industry status and ability to realise greater profits at stake, as well as the opportunity to bypass competitors, financial services organisations can now lay the appropriate foundations for faster change today.
[i] Coleman Parkes research commissioned by Ricoh Europe http://thoughtleadership.ricoh-europe.com/bigger-data/home/
[ii] Economist Intelligence Unit research commissioned by Ricoh Europe http://thoughtleadership.ricoh-europe.com/eu/challenge-of-speed/