The challenge posed by new technology-focused institutions, aiming to capture market share from existing players, is forcing the entire sector to innovate, with significant advantages in terms of both costs and customer relations available for those that
get it right.
But with the global financial sector also in the grip of tightening regulatory regimes and struggling to juggle the demands of its baby-boomer client base with efforts to win over new generations of customers, considerable pitfalls have opened up for those
that fail to develop an effective digital strategy. In order to balance their commercial, risk and compliance objectives, financial services firms must therefore find ways to securely harness information - whether generated online, by telephone or from paper
forms – and use it to build client-centric quality growth.
From a regulatory point of view, the FCA’s Project Innovate - now one year old - shows a commitment to help firms bring new ideas to financial services markets by allowing and encouraging emerging trends to be explored and tested within an evolving framework
of regulation. Yet many firms continue to rely on an eclectic mix of digital and paper-based back-office systems to meet the expectations of regulators and clients alike. This is particularly true of banks and insurers, where many still use legacy line of
business systems and processes originally designed for internal access. These systems, rarely intended for client interaction, offer at best limited connectivity.
Meanwhile clients demand and expect ever higher levels of service and value. Social channels add further to the mix, offering individuals the ability to communicate openly about their experiences, often to the exclusion of the firm in question and with the
potential to have significant bearing on its reputation. Those trying to evolve and meet the digital challengers head on in the battle to win a new generations of customers must therefore devise a strategy that recognises the disparate needs of individual
clients, while ensuring information is managed securely and cost effectively.
Enterprise content management (ECM) offers a readily available solution to these conundrums by providing an agile middleware layer of renewed functionality and control to existing line-of-business systems and processes. Properly implemented, ECM helps increase
user productivity through the elimination of application switching, and at the same time allows for the automation of many costly manual tasks. It also offers increased visibility of information and processes for managers while ensuring a continual audit trail
for compliance purposes.
Efficiency, cost-savings, integration and fewer steps in a process are all potential benefits when considering the wider IT strategy. However, this value proposition could be lost when implementing a new system that adds more work to other aspects of the business
operation. The interaction of the ECM system and how the implementation environment works with existing systems will, therefore, play a key part in how firms can make significant headways in this area.
From a customer point of view, the creation of a seamlessly interoperable environment means a company can integrate any interface it wishes into a single platform behind the scenes. This ensures that the same enhanced levels of customer care are delivered whether
data arrives via electronic or paper documents, as an internally or externally transferred file, or by any new input system that a firm may see fit to introduce. Apps are already being considered by many financial service providers and could become the new
standard for customer interaction, but equally, fast-moving modern consumer technology trends could throw up a new fad that becomes the gold standard within a short space of time.
With a suitable middleware system installed and offering complete interoperability, financial firms currently struggling with outdated legacy systems can compete directly with the latest mobile internet-focused challenger, while still retaining telephone, branch
and paper systems if they are required to retain an older or more conservative customer base. And as new trends evolve, those sufficiently engaged with their customers to feel the prevailing winds can out-manoeuvre the challengers and even leave them behind.