Financial institutions face a difficult situation. On one side, they need to address the demands of regulatory compliance and responsible operations, on the other, fulfil customer expectations of quality and ubiquitous access to services. “Client expectations are high and if a company fails to meet them, customers will start to look elsewhere. This is why service providers should deliver a suite of services, instead of just a particular one. It is similar to cooking, most people can produce something, but if they don’t start with quality raw ingredients they are limited with the end result”, paraphrases Lee Marshall, Head of IT Infrastructure at KNEIP. Growing expectations While this analogy may seem strange, it perfectly illustrates the financial institutions’ need to focus on a range of services rather than just few. This can include the need of better transparency, proper reporting to the market, and answering particular expectations of end investors. In consequence, financial institutions must increase their expenditure on IT. It is not always, however, within companies’ own IT department, but often with service providers. In these cases the asset owner or administrator will look for harmonisation with one company to provide a suite of services. The increased expenditure for IT is, however, mainly offset against significant headcount or risk: the more a process is automated, the less need for people to process reports and the lesser the error risk associated to manually produced reports.
By Lee Godfrey