When it comes to choosing a strategic partner, it's not always simple. There might be plenty of options to choose from, but making the right choice can be exhausting, risky and costly.
The process will be influenced by current and future business goals, and it's not just a case of going from point A to point B in a straight line; the unexpected can happen, and the organization should have an emergency plan for when something goes wrong.
For decades, the wealth management sector has resisted innovation due to the lack of serious competition for customers, assets to manage and profits, and the sector more or less copied what its peers were doing. External pressures such as complex regulations and new, non-traditional competitors are squeezing margins and revenues, compromising future success and leading to an inevitable call to action.
In June 2018, IDC carried out its Innovation in Wealth Management Survey, which showed that 48% of wealth managers are focusing on increasing operational efficiency to improve competitiveness and business strength.
For the past decade, cloud computing has been one of the main disrupting technologies, helping businesses across industries to transform their operational models, powering data use as the primary source of value to boost operational efficiency and speeding up go-to-market strategies.
Wealth managers are now more open to the idea of using the technology to transform their business models to become more digital, more data-driven and more customer-centric. Thanks to different cloud providers and IT architectures — from standardized solutions to more customized offerings — wealth managers have a range of new options, regardless of their IT budget, risk appetite and business strategy. These solutions can help them to operate in an interconnected ecosystem, reducing risks such as IT obsolescence, data breaches or business continuity, enabling them to comply with tightened regulation and boost operational efficiency from front to back office.
When it comes to choosing a cloud partner, wealth managers should consider these simple recommendations:
- Get a robust understanding of the market's regulatory framework
and the cloud provider's ability to comply with those regulations, as this will help firms to reduce headaches, spot the early warning signs and limit potential damages.
- Based on the business' risk appetite, consider cloud partners that understand and align their solutions to the firm's internal risk policies and procedures to minimize surprises. A good example is data governance: where to store data, how the information will flow through the firm, with whom it will share it, systems access and connectivity, among others.
- Identify and explore multicloud or cross-cloud options (especially hybrid cloud, known as cloud-agnostic) with solutions that can optimize workloads (front to back office), avoid vendor lock-in, reduce deployment costs and improve operational efficiency. SaaS and BPaaS are good cloud-based operating models, giving the firm the flexibility to select features or models based on its business needs.
- Find a partner that will help the firm to promote and drive internal cultural change for a successful digital transformation.
- Evaluate the time-to-market and transformation path based on a dynamic cross-cloud solution or business scale that should be aligned with the business strategy.
- Build a strong business case, keeping an eye on budget plans and previous success stories from the potential partners to understand the return on investment in terms of efficiency gains and timing.
When it comes to addressing this fast-paced change, it is essential to have a partner that understands the business model and value proposition to minimize the impact on the firm's day-to-day operations and to quickly maximize the return on investment.
How AVALOQ is Helping Clients in Their Business Transformation
AVALOQ, a leading provider of wealth management software, helps its customers to deliver better customer experiences in a digitized, always-on and data-driven world. AVALOQ offers its solutions as software-as-a-service (SaaS) and business-process-as-a-service (BPaaS) models to accelerate the transformation, helping its customers to deliver better customer experiences while addressing their cost and productivity challenges.
Deutsche Bank Wealth Management — Focus on What Is Important: Clients' Needs
For a number of years the wealth management business has been facing huge pressure to improve operational efficiency, performance and compliance. At the same time, however, it has neglected an essential long-term growth driver: innovation.
In today's environment, where digital transformation aims to eliminate traditional market friction, wealth managers must think differently about how they want to serve their clients, how to build competitive advantage and how to comply with more complex regulatory frameworks.
Deutsche Bank decided to transform its global wealth management operations to expand its global footprint, focusing on clients and standardizing operations.
The journey started in Switzerland in 2013, where AVALOQ now runs the main datacentre and provides application management services and back-office operations. After a 14-month implementation that helped to significantly reduce operating costs, the bank successfully migrated its two Asian booking centres in Hong Kong and Singapore onto one multi-entity, single instance (MESI) AVALOQ system...
Another whitepaper from IDC
For some years now the wealth management sector has been facing enormous pressure to improve operational efficiency, performance and compliance, while neglecting an essential long-term growth driver: innovation.
In this IDC whitepaper you can learn
- How wealth management firms see the opportunity to increase operational efficiency.
- The importance of digital platforms and open ecosystems
- The new operating models and how cloud services such as BPaaS and SaaS are proving enablers for innovation