Capital Markets: Strategic Technology Choices in 2019
Finding a path through all the noise
Capital markets firms are faced with an array of strategic choices in 2019 centered upon technology. Our capital markets research team will focus in the coming year on providing a realistic and informed view on the key developments that will affect those strategic decisions. We will help you find a path through all the noise.
One continuing imperative for sell side firms is improving the client experience across multiple dimensions, including relationship management, execution, and data/tools. Faced with rising expectations for efficiency (both human and capital), banks are refining their strategies to keep the client front and center while leveraging the latest and greatest technology.
Investment banks and brokerages aren’t going to be able to do that alone. They’ll need to harness the power of the ecosystem, including market infrastructures, technology vendors, service providers, and fintechs. They will also need to tend to their own infrastructures by leveraging the power of cloud computing, managed services and utilities to develop more scalable and agile solutions.
The middle and back office, sometimes deserted, is coming back front and center. An acceleration in improving the client experience requires that the front office not drive all decision making. Front-to-back transformation will provide an edge. Of course, the buyside clients are not sitting still. Having relied heavily on the sell side to deliver solutions, and faced with their own strategic choices, they will increasingly re-invent their own core systems and infrastructure for a digital age, sometimes leveraging their broker-dealers, vendors and service providers, and other times building solutions internally. However, tight budgets and urgency dictate that third-party vendors and service providers be leveraged to ensure best practices.
Technology advances are allowing innovation to occur, by breaking some of the trade-offs between cost and performance. Some of the most notable in capital markets are APIs and microservices, cloud, AI/machine learning, robotic process automation, and blockchain.
In 2019, Celent’s capital markets research will be wide-ranging as we seek to help firms understand the changing technology landscape, prioritize their wide array of strategic choices, and select the partners to help them on the journey. We’ll be exploring a host of topics, organized around our key themes. For a view on those themes, please see my blog post here.