The need for transforming outdated banking systems has existed for some time because of inflexible legacy systems, a retiring workforce and technology that hadn't reached a point where changes could be facilitated without a rip-and-replace approach. But the competitive landscape continues to change as more outside players come into the market, driving innovation without overhead or outdated infrastructure holding them back. Tomorrow's requirements demand real-time interoperability, which will influence a bank's ability to maintain a competitive business position.
Falk Reiker, SAP Business
Banks need to put a plan in place to rethink their technology strategy or they risk becoming like the U.S. automakers of the 1980s, which faced competition from more-progressive manufacturers in Asia. As a result, customers began to perceive U.S.-made cars as lower in quality and higher in cost, and U.S. manufacturers saw an erosion of sales.
It will not be an overnight transformation. Banks will start with a phased approach that first simplifies the processes they currently have in place to reduce redundancy.