Change is difficult. For financial services providers, change has been the mantra for the past several years, but that hasn’t made the change process any easier. The challenging, ever-changing marketplace hasn’t helped. A difficult regulatory environment is book-ended by increasing customer demands for better, more innovative service.
Some speculate that the ongoing focus on regulations and cost cutting has detracted from focusing on the core business. The results of Accenture’s High Performance Finance study demonstrate that the time is now for financial service providers to shift away from defensive strategies in favor of streamlined approaches that simplify the complexity we’re facing today.
Complexity is causing plenty of headaches. The CFOs we surveyed reported that four of the top five challenges they face have to do with complexity: complex legacy systems; complex needs of stakeholders; complex business; and complex enterprise operating models. For financial services providers, that last point is particularly relevant, as silos have created infrastructures that are difficult to navigate.
Organizations must focus on reducing complexity by centralizing, standardizing and enhancing integration. As the banking report of our High Performance Finance study outlines, regulations would be easier managed with a centralized team—a center of excellence that lets a bank more efficiently manage changing regulations. The insurance report recommends creating a single, enterprise-wide finance and risk model, complete with a centralized repository. And the capital markets report highlights the value of enterprise-wide regulatory compliance management and reporting centers of excellence.
It’s time for all financial services providers to streamline, to improve integration, to centralize and to simplify. Transforming the business model may be difficult, but it’s never been more critical to survival.