Infosys’ recent report into Innovation in Retail Banking highlighted that on the whole banks are embracing
innovation. Since last year’s study there has been a seven percent boost in the number of banks that are investing in innovation and now the figure has peaked at 77 percent. The figures may be surprising to some as they overturn the belief that banks
are conservative and inflexible when it comes to change.
However, as uncovered in the report, one of the biggest obstacles that’s hindering banks from innovating further is the complications that occur as a result of
legacy systems. In fact, as many as 58 percent of the retail banks questioned stated that being able to deploy new systems in components would enable them to innovate further.
Legacy systems tend to be banks’ systems of record and it’s natural for them to want to minimise any fundamental changes to how these are organised. But the much-needed improvements in customer service depend on how processes involving these systems are
better automated and more seamlessly integrated.
In a competitive industry where innovation is key, banks need to have agile IT solutions in place that can help them overcome these difficulties and integrate legacy systems. They’re particularly under pressure, owing to recent scandals like PPI, to rebuild
public trust and ensure they’re offering the best possible customer service. The fact that this report suggests that banks are willing to invest in innovation means that they’re willing to see how they can overcome these issues by embracing
Business Process Management (BPM) technology.
BPM is integral in enabling process improvements to be layered over the top of legacy systems to streamline and simplify processes. An organisation can avoid having to rip and replace old systems and instead add on to them. While many banks’ business processes
are supported by enterprise applications, they don’t give full control of the bigger picture combination of computerised and manual processes which can impact on the bank’s success, which is something that BPM can address.
In order to make significant improvements to their efficiency, financial organisations can look at using BPM to align the way that they do business with their primary business goals, whether these are related to how best serve their customers, how
to get the most value out of limited resources or how to reduce operational risk. They are able to do this in a structured way based on evidence, rather than them having to guess what the best plan of action would be.
Manual intervention can often lead financial organisations to needless mistakes and delays, for example when a customer is switching accounts. Automating processes with
BPM technology means business can be run a lot more smoothly, without having to increase expenditure further with additional operational costs.
The key challenge for financial organisations however will be in how these process improvement projects are implemented. It’s important to incorporate flexible
process and content management solutions as they allow banks to close information gaps and obtain a holistic view of how people, processes and content are all working together. These solutions can also enable banks to improve data security, streamline
audits and adapt to ever-changing regulations.
Flexible, agile IT solutions are essential for banks wanting to innovate further as they provide a vital means to overcome the challenges from legacy systems. What’s more, they give banks the vital flexibility to adapt as market needs change and regulatory