IBM Sales and Distribution Thought Leadership White Paper
Cloud computing for banking
Driving business model transformation
Cloud computing for banking
The banking industry is facing unprecedented changes. Control is now in the hands of the customer, rather than the bank. Customers are driving new business models. Their use of technology—in addition to changes in social and household dynamics—is driving business transformation. Banks need to react to this new customer-driven environment with innovation in business models, operations and IT. For banks, the value proposition for cloud computing affects the entire business. Cloud technology offers a ...view middle of the document...
The dramatic changes taking place in banking require new ways to maximize profitability and returns. By modernizing and transforming older back office systems into modular building blocks, banks can create a flexible and agile banking environment that can quickly respond to new business needs.
Banking Industry Trends
With the rise of existing and new, non-traditional competition, banking faces a changing business landscape. Satisfying customer demands has become more complex as customers demand more convenience and control over their banking services. At the same time, regulators are ushering in a new era of government oversight. Banks currently face challenges in a number of key areas:
“Globally, ninety percent of financial services clients surveyed1 believe they need to transform from the status quo for future profitability”
Cloud computing is revolutionizing ecosystems in multiple industries, and banking is no exception. Cloud technology offers secure deployment options that can help banks develop new customer experiences, enable effective collaboration and improve speed to market—all while increasing IT efficiency. Cloud adoption is growing rapidly because it can be made secure for business. In fact, according to the IBM 2010 CIO Study, “Sixty percent of CIOs plan to use Cloud—up from thirty-three percent two years ago.”2 However, in developing or updating a bank’s cloud strategy and infrastructure, it is important to keep
Capital inadequacy that depresses profit margins Emboldened customers who expect rapidly evolving new services and offerings Fierce competition for customers has spawned industry consolidation and the entrance of nontraditional firms
IBM Sales and Distribution
security in mind. You need to understand which delivery models are appropriate based on security and trust requirements with connecting systems. You can apply a methodology such as the IBM Security Framework to measure what you need in areas such as governance, architecture, applications and assurance. The framework can help you define the set of assurance and security measures you need to take to meet security requirements. Banks that take advantage of cloud computing are better positioned to respond to economic uncertainties, interconnected global financial systems and demanding customers. They can use information to enhance customer segmentation techniques and to develop more focused services that are aligned with customer needs. Banks also can optimize their channel investments and differentiate themselves through customer service excellence. Armed with new insights, banking leaders can identify and eliminate the cost of complexity in their operations and use new and existing forms of information to optimize risk.
Driving sales and profitability A mortgage company implemented a cloud-based integrated collaboration mortgage solution, so customers can apply and complete loans electronically. Instead of going into a branch,...