3 April 2017
The Evolution of Work - The Pressure is on for the Financial Services Industry
It’s been eight years since the financial crises and the industry remains under pressure to improve profitability while at the same time addressing their customer demands for more flexible, convenient and competitive products and services. Given the macroeconomic environment these challenges will only increase, driven by factors beyond the control of senior executives such as, low interest rates, slow income growth, greater capital requirements and increased regulatory pressure to name a few.
Management and operations teams have already harvested the easy cost savings in response to the financial crisis, however those gains have been largely offset by digital projects and regulation-driven investments such as risk management and compliance. Promised efficiencies have not materialised because many transactions still go through legacy work practices and processes.
Other organisations have fallen into the trap of focusing on restructuring and automating existing processes, but they have not seriously considered removing some of the work practices and processes in the first place. They have layered on complexity with new digital channels and additional compliance activities, resulting in frustrations and tensions for all stakeholders.
The challenge seems simple in theory, “reengineer and automate end to end processes, reduce duplicate work, minimise decision making, integrate systems and exploit new technologies to deliver a dramatically reduced cost base”. However, in practice we see the majority of lean and change programs failing to deliver the desired level of cost reduction, and those that initially do, often cannot sustain the savings.
In my next blog I’ll discuss in further detail how to tackle these common challenges and bringing the workplace into the future.