PA Consulting Group's David Troman, head of financial services, is quoted in an article in Lexis Nexis. David joined a panel of experts to look back at the most important developments and challenges for financial services in 2015.
David provides a view on the market and his take on the industry in 2015. He says: “The regulatory burden is here to stay. Banks are increasingly looking at how to reduce the cost of compliance. Rather than simply reacting to major programmes without due consideration, financial institutions are now demanding more of their risk and compliance teams. They want change delivered in a cost-effective way and are demanding a more co-ordinated and controlled approach to regulatory change.
“There is a lack of innovation from incumbents. We surveyed financial services firms in 2015 and found that only 35% were backing high-potential innovations where outcomes are not guaranteed. This was the lowest share among private sector respondents. In addition, nearly half (46%) said their organisations talk more about innovation than actually do it. These responses clearly reflect worries about the burden of compliance and regulation is a significant reason why we are not seeing more innovation from incumbents.
“Competition for SMEs is also on the increase. Challenger banks are chasing growth from the SME market. This shift in focus away from the retail customer and on to SMEs is a result of persistent inertia among retail customers despite auto-account switching. The challenger banks with a network of branches are leading the drive to increased competition within the SME market.”
David also goes on to talk about how the market has changed over the past 12 months: “Simplification is now the key. The speed of delivery through organisations needs to be improved as boards are looking for early delivery and delivery certainty. Boardrooms want assurance that projects will deliver benefit and are looking for change to happen quickly.
“Traditional institutions now recognise the need to focus on incremental delivery. Rather than waterfall programmes, financial institutions are adopting more agile approaches to deliver early benefit both internally as well as for their customers. There is an increasing need for them to adopt this approach as they respond to the more nimble challengers.”