By Abdi Essa, Regional Vice President, UK&I, Dynatrace

Disruptive innovation by fintech firms and the shift away from in-person banking during COVID-19 lockdowns has resulted in increasing consumer and business expectations for better mobile and online financial services. This is driving an acceleration of digital transformation across the financial services industry. Cloud computing is at the centre of this transformation given its inherent agility, efficiency, and scalability.

Pressure to accelerate digital transformation

Financial services organisations rely on myriad apps and cloud systems to drive revenue, stay connected with customers, and support employee productivity. Their digital teams know transformation must unlock faster innovation, more efficient collaboration, and consistent delivery of greater business value. Nine in ten finance sector CIOs surveyed for a Dynatrace research report said their digital transformation has accelerated in the last year, and 57% expect this to speed up even further.

Digital teams are being asked to achieve this accelerated transformation with very limited resources. They’re also tied up with manual-intensive tasks, which holds them back from focusing on innovation as much as they need to. Nearly half of their time is spent “keeping the lights on”, at a typical annual cost to finance firms of $5.3 million.

Tech teams struggle with complexity

Bandwidth problems are set to get worse, with CIOs currently expecting their teams to face 28% more work in the next year as systems become more complex to manage. Already popular software-as-a-service (SaaS) and infrastructure-as-a-service (IaaS) arrangements will soon become more prevalent. This is according to recent research which shows over eight in 10 firms have an advanced multicloud setup, and 54% expect to increase their use of this approach further.

The complexity of managing these ecosystems is increasing as businesses continually scale. Whether it’s bringing in new payment services, integrations with partners to offer new benefits to customers, or delivering new mobile functionality, financial services organisations are adopting new multicloud architectures and integrating with many more third-party services providers. This brings new operational challenges for IT, as teams are faced with a scale, complexity, and frequency of change far greater than previously experienced.

Cloud and IT operations teams are struggling to keep up with increasing demands for digital innovation, and 67% of CIOs warn their cloud environment is already so complex that it is beyond human ability to manage. Manual approaches used to configure and instrument apps, or script and source data, are clearly not enough. On average, companies operate a staggering 11 different monitoring solutions across their technology environments to manage them, which simply isn’t working. In fact, CIOs are only confident they have full observability on 10% of their systems, meaning they are effectively flying blind despite all their monitoring investments. This puts both customer experience and internal operations at risk.

A transformational approach

Financial service firms are increasingly looking for a radically different approach to IT Ops, DevOps, and digital experience management. Applications, microservices, and containers need to be continuously and automatically discovered. Entity maps and performance baselines must be updated continuously, with everything automatically monitored, analysed, and adjusted at all times. Such automation is essential in freeing digital teams to improve collaboration, and to focus on more value-driving tasks that optimise digital banking experiences and enhance business outcomes.

CIOs recognise the urgency of these developments. They need much better visibility across multicloud environments, with automation to reduce manual instrumentation and intervention. Four in 10 want a single platform that captures metrics, logs, and traces, rather than the mixed bag of monitoring tools they currently rely on. Over half are looking for a clear ability to correlate IT performance and business metrics so they can better understand the impact that IT is having on outcomes such as revenue and customer satisfaction.

The road to an autonomous future

Some 75% of tech chiefs warn of a loss of competitiveness if they don’t achieve drastic reductions in the time spent ‘keeping the lights on’. Automation could cut four-tenths of the time spent here, offering an average annual saving of $2.5 million – yet firms have automated only 20% of repeatable processes, mainly due to a lack of skills and access to their data in a single place.

As a result, observability, automation, and AIOps are now a business imperative. True observability, which incorporates the broadest data – metrics, logs, traces as well as data from user experiences and the latest open-source standards – provides finance firms with insights that empower the most advanced digital customer experiences; automation and AIOps deliver the efficiency and cost-savings that are needed. Now is the time for banks, insurers, and other financial service providers to act. As their hybrid, multicloud environments grow in scale and complexity, they need to harness advanced, automated observability and AI to understand interdependencies across their technology stack and enable rapid scalability for continued success.