How infrastructure could power a financial services rebound
By Mike Smith, Managing Director (Direct), Virgin Media Business
Covid-19 has forced the financial services sector into a rapid and unexpected revolution.
From the sudden need to shift all office work to the home to dealing with clients and customers through online channels.
Despite this, the sector responded better than most due to the technology and infrastructure it had in place before the crisis.
67% of finance leaders feel their business was fairly well prepared for the crisis, according to Deloitte, highlighting technology as the key force in helping them to stabilise.
And while the need for banks to remain in survival mode continues for now, lockdowns will eventually loosen. The sector must be prepared to take advantage of the new opportunities that emerge.
Levelling the playing field
Covid-19 has levelled the playing field for all businesses, including financial services.
When you look at the technologies that have delivered transformation – video conferencing tools encouraging employee collaboration, cloud technologies powering remote customer contact centres to cope with the surge in online demand – invisible infrastructure has been one of the strongest forces powering these interactions.
According to the Economist Intelligence Unit, the success of the tech foundations put in place during the pandemic has inspired banking leaders to take a more enthusiastic view on innovation generally, as shown in its latest annual survey of executives.
66% said new technologies will have the biggest impact in the sector over the next five years – a 57% increase from last year’s figure.
61% believe that the adoption of cloud technology will be transformative for banking, and there has been an increase in those looking to emerging solutions like artificial intelligence.
Thinking ambitiously about the use of technology can open up exciting possibilities for banks, whether that’s the customer journey becoming increasingly voice-enabled or chatbots speeding up services and ensuring people get served seamlessly and successfully.
This openness and optimism will be crucial to making rebound from Covid a success and gaining an edge over competitors, as long as banks are supported by continually advancing digital infrastructure.
Looking to the future, we know banks will need to continue digitally transforming, striving to ensure invisible infrastructure can support their employees, operations and services to customers.
Asking the right questions
McKinsey has found that modernising tech capabilities selectively is a crucial task for businesses in responding to the fast-changing environment.
But this throws up some tricky questions.
How can banking leaders be ‘selective’ when they’re confronted with such a confusing array of technologies? How can they embrace them without causing even more disruption, or exposing their organisation to the risk of cyber-attacks or data breaches?
Choosing the right invisible infrastructure solutions is about remembering that digitisation doesn’t just mean technology.
As the Harvard Business Review has described, having the wrong attitude – thinking about digital change as being just about ‘disruption’, for example – can result in poor investment decisions.
What banking leaders should focus on instead is foundational upgrades. Whether that is through cloud technology or networks, these will provide them with clear boosts to efficiency and delivery without ripping legacy infrastructure out completely and starting all over again.
And if banks have a strong strategic partner, a technology supplier that will advise them on digital change over the long term, they can benefit from strategic advice on where exactly these incremental changes should occur across their tech stacks.
They can also provide counsel on countering another threat on top of Covid-19: the risk of cyber-attacks.
Since the beginning of the pandemic, banks have experienced a 238% surge in cyber-attacks.
These could have crippling effects on an organisation’s rebound efforts, crushing a bank’s capacity to serve customers, interfering with vital systems and damaging their reputation permanently.
That’s why banks need to look carefully at a solution’s security features and interrogate them.
Does it come with end-to-end security?
How robust are user authentication measures?
Have the tech providers thought about the changing digital landscape and adapted their security approaches in the right way?
Asking these questions is important because when resilience is embedded at the heart of an organisation’s infrastructure, banking leaders won’t just have peace of mind. They’ll also benefit from the confidence to focus on customer acquisition and direct their energies towards making their rebound a success.
A unique opportunity to rebound
Recover, rebound and race ahead.
This will be the task for banks across the UK when the time comes to elevate their thinking beyond survival and towards growth and prosperity.
This year has underlined the importance of invisible infrastructure, especially the cloud technology and networks powering virtual interactions and empowering employees to collaborate, keeping businesses going.
Financial service firms will need to continue investing in these foundations to ensure they’re equipped with the scalability and resilience to drive rapid growth and prosper.
“While the current environment is undoubtedly challenging,” banks have a “unique opportunity to succeed in the long term.”
Banking leaders can grasp this by ensuring their rebound plan is powered by digital infrastructure.
A version of this article ran on Banking Sector.
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