Technology has affected banking and financial services and how they are evolving. Four themes have emerged to illustrate the rapidly changing industry.
- Integration, integration, integration!
With so many new lines of business, financial service companies became challenged on how best to integrate functions to be more efficient, serve customers at the highest level and effectively manage costs. While integration has been a long-standing corporate goal, it is only in the last several years that technology has emerged that allows for meaningful advancement.Today, customer service can be accomplished in discrete and sometimes remote locations from the headquarters base – especially where labor availability and wages make it easy to do business. Financial records can now be quickly, accurately and centrally reconciled, as well as patterns identified that allow an institution to manage risk and find new opportunities to serve their customers/clients.Many institutions are still working through melding their legacy acquisitions and functions into a cohesive whole. It’s not as simple as flipping a switch to turn on the new systems.
- Future directions in hiring.
Companies are targeting a very different financial service professional. In the past, jobs in the banking and financial sector were for traditional roles such as relationship managers, compliance officers, underwriters, risk managers and sales.Today, we are seeing new roles like infrastructure developers, software engineering, JAVA and Tableau engineers, cloud development, security and data loss prevention, business intelligence, automation engineers and trading technology. Some of these jobs will be accommodated in corporate headquarters and regional headquarters locations and more will flow to operation hubs across the U.S. as the industry continues to integrate and streamline functions.
- Today’s operation hubs-how are they evolving?
Change is taking place very rapidly as technology advancements allow companies to digitize functions and share raw data, results and analyses across their platforms. Location decisions from years ago are being rethought and space commitments from a few years ago are being reconsidered. The fundamental boardroom issues being discussed today are the functions that should take place in those locations and whether the newest of the locations are still needed for where the company is now headed.Some hubs have served the financial services industry for decades as a processing location are becoming antiquated as digitization allows better integration of operations elsewhere. Increasing digitization allows the company to move functions fluidly from city to city. We expect to see some companies stepping away from locations – perhaps even headquarters or recently built projects. This change allows the opportunity to identify the right balance between headquarters and operations space.
- Change is certain!
Given the need to drive efficiency through integration, we expect to see a portion of office space located outside headquartered cities to be resized as companies digitize functions, allowing them to consolidate operations. Some companies might choose to leave their headquarters locations in favor of lower-cost environments to retool operational efficiencies quickly and manage costs.
With change being certain, financial services institutions will be working to optimize operations to reach greater efficiency, serve their customers better and manage costs efficiently. Learn more about technology impacting today’s banking and financial industry. Download our 2018 Financial Services Operations Centers Report.