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InterSystems Ireland’s Redmond O’Leary discusses how financial services can streamline operations using tech, without increasing risks.
While accelerated digital transformation is happening across the board, every industry and sector must move at its own pace for a variety of reasons.
Areas like healthcare and financial services in particular have huge volumes of sensitive data and additional regulatory requirements, which mean the evolution of technology in these industries must be carefully managed and thought out.
Red Hat’s Monica Sasso recently spoke to Siliconrepublic.com about why exactly legacy systems exist within financial services and why change can appear to be slow.
Redmond O’Leary, sales manager at InterSystems Ireland, agrees that these legacy systems continue to provide value for financial services institutions.
“New legacy has been created as various departments sourced their own cloud and point solutions. So, there are a lot of positives to these systems,” he told Siliconrepublic.com.
“However, problems arise when silos occur. This makes it difficult to get the information needed for decision-making, regulatory compliance, enterprise-level risk, and to understand their customers to serve them better.”
Because of these silos, O’Leary said access to data and the ability to harness accurate insights can be severely hindered and that can impact security and regulations. To combat this, he said many institutions have invested in data lakes or data warehouses, which are essentially centralised repositories for storing data.
“But in reality, they’ve just created a bigger silo and it wasn’t the silver bullet they hoped for,” he said.
Streamlining processes
“Another challenge we’ve noticed is streamlining operational processes to gain efficiencies. It also comes back to how disconnected systems and processes tend to be within financial services institutions,” O’Leary added.
“Looking at Ireland specifically, a significant challenge is that many of the financial services on offer aren’t reflective of what the population wants. There aren’t the same convenient mobile apps with the features and functionality that are on offer in other countries, which needs to be addressed.”
Pillar banks like AIB and Bank of Ireland have come under increasing pressure in recent years following the entry of fintechs such as Revolut and N26, offering quick app-based payments. At the beginning of the year, four of Ireland’s major banks made plans to team up on a new digital payment system to take on these rivals, but these plans were quickly put on hold by Ireland’s competition watchdog.
While the need to digitise and streamline is clear, the ongoing fear around security and regulatory risks is a very real challenge for financial institutions. However, O’Leary advised that these organisations take it slowly, keeping the existing applications that they are reliant on in place and not to replace everything at once.
“Instead, build new composite processes that span different systems to connect and streamline as much as possible,” he said.
“They can also incorporate data and embedded analytics, such as predictive analytics and machine learning, to build smarter processes including real-time intelligent processes that are event-driven, and not only connect and streamline processes but can also take intelligent action based on what is happening at that moment in time.”
Smart data fabrics
Another area O’Leary said is worth exploring for financial services institutions is smart data fabrics. This is a new architectural approach that aims to speed and simplify access to data assets across a business.
Enterprise data fabric weaves together data from internal silos and external sources, creating a network of information and, according to Gartner, is the foundation of the next generation of data and analytics trends.
Smart data fabric goes one step further, with a range of capabilities such as data exploration and machine learning embedded directly within the fabric.
“This makes it faster and easier for organisations to gain new insights and power intelligent predictive and prescriptive services and applications,” said O’Leary.
“They simplify data landscapes by bridging data and application silos and allowing organisations to obtain a single, unified view of the data, without requiring them to rip and replace any of their existing technology.”
Outside of smart data fabric, the biggest trend O’Leary sees coming down the line for financial services institutions is hyper-personalisation for customers.
“This will see firms leveraging customer sentiment, whether about their app or services on offer and using it to create new products,” he said.
“Adoption of intelligent automation will allow institutions to tackle some of the low hanging fruit so that they can consolidate and simplify their technology and some of those more laborious processes, enabling leaders to focus on those bigger picture initiatives.”
