Build, Buy, or Something Better?

It’s not easy being a bank these days. Over the past five years the financial industry has faced a perfect storm of economic uncertainty, regulatory pressure, sustained low interest rates, customer consolidation of bank relationships, cost containment demand and ever-more demanding customers, forcing banks to operate in “react” mode, rather than plan for strategic growth. More than ever, banks are under pressure to transform their technology and processes. They not only need the flexibility to change quickly, streamline and automate processes, manage risk and regulatory processes, but also need to deliver a holistic, client-centric experience across channels, systems and business functions.

Bank organization doesn’t help. Typically banks are organized by business function with commercial lending in one area and cash and trade and securities in another. Within these functions, there can be sub-segments based on the product, such as asset-based lending, wholesale lockbox and foreign exchange trading. It’s not unusual for each of these sub-segments to have stand-alone onboarding, servicing and web applications.

It gets worse. The complexity is exacerbated by decades of mergers where only some infrastructure was decommissioned, leading to separate applications for each of the functions within the bank. Customers have been forced to deal with multiple relationship managers and multiple service  that have no common view of their business or onboarding, sales and service interactions. In a growing landscape of educated, demanding consumers, this is not an ideal recipe for winning in customer satisfaction.

So what’s a bank to do? The good news: there is a solution—the modern crop of business process management (BPM) tools. With the help of these tools, banks are delivering outstanding client experiences that can be tailored to the client with a global presence, and delivered through multiple channels to serve them when and how they demand. 

BPM solutions are flexible, take advantage of modern development techniques, enable reuse of common business rules and processes, allow for situational differences and process variations and provide simplified integration capabilities. Most importantly, they enable a bank to “wrap and renew” their existing infrastructure to create a true client-centric experience while continuing to leverage investments in existing systems. 

In my next two blogs, I will explore why BPM is a far better choice than such options as packaged applications or custom-built solutions and look at how BPM can benefit both your customers and your bank with simplified, streamlined and compliant processes that can substantially reduce operational costs and overall risk.