To optimize global opportunities, banks must strive for standardization, tackle customer experience from the top down, and move beyond traditional IT outsourcing.
The ongoing European financial crisis and overall economic downturn have driven banks to reprioritize their technology investments and raised a renewed sense of urgency around optimizing operations. For large banks that have staff, customers, vendors, and operations spread across the globe, that means moving in unison across multiple markets to operate more efficiently on a global scale while still enabling flexibility that powers innovative, valuable products for local customers.
According to Judd Holroyde, SVP and head of global product management and delivery at San Francisco-based Wells Fargo, the key to becoming a successful global bank depends on evolving your overall operating model, and a big part of that is taking a proactive approach to identifying and implementing technology while exploring the best ways to standardize, outsource, and maintain a consistent customer experience. "I don't think any banks are completely there today," he says. "But do I think they are heading there quickly? Yes."
Although one clear path to globalization does not exist, financial industry experts agree on a few areas where banks should focus their attention in order to optimize global opportunities and achieve world-class distinction.
1. Strive for Standardization With (Not too Much) Flexibility
In the new global environment, it's not feasible for financial institutions to support very complex, siloed operations and platforms, according to Likhit Wagle, GBS banking leader at IBM. "That sort of complexity makes it very difficult to manage the business and bring new products to the market, and it's more expensive," he explained. A more streamlined approach across the globe enables banks to take advantage of economies of scale, drive down overall cost-to-income ratios, and increase speed to market.
That's where industrialization--simplifying a bank's operating model through the standardization of products, processes and technology across markets--comes in, said Fiaz Sindu, an executive with Accenture's core banking services group. Key to industrialization is "ensuring that the manufacturing, fulfillment, and servicing that go with a bank's products are centralized across multiple segments," he explains. "Whether it's retail banking or wholesale banking, there needs to be a common engine underneath that supports those segments."
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