Tag: Banking BPO

IDC Lists 3 Stages of Intelligent Automation Value Chain | In the News

The Everest Group Banking BPO Annual Report 2018 noted that 85% of banks surveyed as part of the study said digital transformation is a priority in 2018. However, only 19% are optimizing or integrating their front-, middle-, and back-office for true digital transformation.

One innovation that is garnering attention in this digital race is robotic process automation (RPA) with its promise of automating certain processes to allow for improve customer experience, greater operational efficiency and a greater sense of accomplishment for employees.

Read more in Enterprise Innovation

85% of Banks Claim Digital Transformation as Priority, But Most Are Merely ‘Digital Washing’—Everest Group | Press Release

Banks are increasingly adopting automation, cognitive/AI, analytics and blockchain, but too many banks mistake digital projects (mostly in the front-office) for digital transformation

Everest Group reports that 85 percent of banks have digital transformation implementation as a priority for 2018, driven by the need to find efficient ways to address challenges in the industry such as cost pressures, eroding top lines, uncertainty and instability in the geopolitical environment and decreasing customer satisfaction. Unfortunately, in the rush to find digital solutions, many banks are mistaking digital projects for digital transformation.

According to Everest Group, 81 percent of banks are implementing digital projects focused primarily on their front-offices; only the remaining 19 percent are actually going for true transformation by optimizing and integrating their front-, middle- and back-office operations.

“Those 81 percent of banks who have only invested in front-end application of digital technology are engaging in what we call ‘digital washing’—claiming transformation achievements when they are in fact far, far away from true transformation,” said Manu Aggarwal, practice director at Everest Group. “True digital transformation requires connecting the dots between the front-, middle-, and back-office processes to achieve key business objectives. Moreover, it is not an isolated implementation of technology. Rather, it’s an ongoing process where changes in technology and alignment to goals need to be continuously checked.”

In examining the digital transformation strategies within the banking industry, Everest Group identified the following trends:

  • Strengthening competitive position, building market share, acquiring and retaining customers, and generating cost savings are some of the major factors for adopting digital technologies.
  • Market facing front-office processes lead the demand for adoption of digital services, mainly targeting customer experience.
  • Some of the key levers of digital adoption include Automation, cognitive computing and artificial intelligence (AI), analytics, and blockchain.
  • While the adoption for automation, AI and analytics is primarily driven by lending, retail banking, and cards and payments, most activity in blockchain is happening on the commercial banking side.

These results and other findings are explored in Everest Group’s recently published report: Banking BPO Annual Report 2018: Digital Transformation or Digital Washing: Looking Beyond the Hype. The report addresses digital washing and the key considerations for successful digital transformation. It also examines the levers of digital adoption within the banking industry, with an emphasis on automation, AI, analytics and blockchain.

***Download a complimentary 11-page abstract of the report*** (Registration required.)

End of the Line for Traditional Sources of Bank Growth Drives Urgent Interest in FinTech, Business Process Service Providers | Press Release

Robotic process automation, analytics and consumer-facing technology solutions will sustain 5-9 percent growth in banking BPO market through 2020

The proverbial advice “if you can’t beat them, join them” is particularly apropos for banks who find themselves competing against FinTechs (financial technology companies) in the digital age, according to Everest Group in newly published research addressing the business process outsourcing (BPO) market in the banking industry.

Everest Group reports that the traditional banking model with its legacy technologies and ways of doing business has reached the end of the growth curve, so banks must now focus on new technologies to survive. To remain relevant in an evolving market of new-age consumer preferences and unprecedented external pressures, banks are turning to technology solutions such as robotic process automation (RPA), analytics, artificial intelligence (AI), open application programming interfaces (APIs) and blockchain to decrease costs, improve operational efficiency, offer more personalized solutions, and deliver a seamless digital experience to customers.

In some cases, banks are building these technological capabilities in-house, but in many cases, banks are turning to service providers and making allies of former FinTech competitors in order to survive in the ecosystem and offset marketplace challenges.

“Banks can combine their strengths—such as access to resources, trust of customers, and expertise in core banking services—with the innovative offerings of technology players to cope with the significant challenges they are facing in the marketplace,” explained Anupam Jain, practice director at Everest Group. “This is why we are seeing a sustained growth rate of 5 to 9 percent in banking BPO. Service providers are supporting banks by leveraging their expertise in technologies such as analytics and blockchain. And we’re also seeing banks establish collaborative, win-win partnerships with FinTech players who have deep technological assets. This will be a dominant strategy for the bank of the future.”

These results and other findings are explored in Everest Group’s recently published report: Banking BPO Annual Report 2017: Disruption Does Not Discriminate — Banks Embracing Digital to Stay Relevant. The report provides comprehensive coverage of the global banking BPO market, including detailed analysis of the state of the market and challenges faced by banks, market size and adoption by lines of business (LoBs), technology adoption, and the future outlook for banks.

 Other key findings:

  • The global banking BPO market is expected to grow at a steady pace of 5-9 percent over 2016-2020.
  • While North America continues to be the most significant market for banking BPO, Continental Europe and Asia Pacific have witnessed significant growth.
  • Bank LoBs are facing challenges to remain profitable with the pressure of regulations, competition from non-banks and rising expectations of customers.
  • The overall BPS industry has witnessed significant RPA adoption; however, its adoption in the banking BPO industry remains low.
  • Analytics in BFSI (the banking, financial services and insurance market) is starting to differentiate in its usage, and BFSI is poised to remain the largest market for analytics.

***Download complimentary report abstract here***

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