By Brian Smith, Partner & Managing Director, FSO Services North America, TPI
The economic situation in 2009 has changed the game for banks of all sizes. Going into 2010 they are all looking for new business strategies to rebound. Across the board, banks will be restructuring in 2010, but what types of strategies will they look to employ and will they turn their eyes to “the cloud”?
Onshore operations have always provided the lowest margin of risk – but at a higher cost than offshore operations. Offshoring, now a generally accepted approach to multi-process IT and BPO services for top-tier banks, will draw in more mid-tier, regional banks interested in taking advantage of the managed services that are now widely available.
The anticipated service provider consolidation in the next year will also allow single large providers to become a tempting comprehensive solution for financial institutions. The need to minimize costs and reduce risk may lead the banking world in two distinct directions: a flight toward larger, more established providers or toward niche players to distribute risk.
And, of course, we can’t ignore the enormous “cloud” in the room. As more and more services and products are made available online, financial services firms will experiment with the level of security, service management and contract challenges they present. It’s possible that this could be the year of true paradigm change meaning broad acceptance of cloud based services – which could significantly disrupt established service delivery models.
2010 will truly be a year of balancing onshore and offshore services with Captives and third-party solutions while dipping a toe into the world of cloud based services. The potential opportunities available by the cloud and consolidation of service providers could set banks up for a delivery model hybrid not yet experienced in financial services.
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