Straight Talk Technology
This month, Ovum launched its ICT Enterprise Insights 2019–20 program. This is Ovum's annual study with senior ICT executives at over 6,700 enterprises looking at their investment strategies and objectives for the coming year, examining prioritization from technology and industry-specific perspectives over 15 key industries.
One of the areas explored in all of the ICT Enterprise Insights programs is an evaluation by the executives of the relative importance of various technology objectives. Here respondents are asked to rank the importance of several technology imperatives, which in a condensed view include: cloud, workforce modernization, IoT, security/privacy, information management, digital capability, legacy modernization, and customer experience.
At the start of the decade, the dominant technology imperative, as identified by a significant majority of retail banks and financial institutions, was managing security, identity, and privacy. While security has remained paramount, over the course of the decade there was a notable swing towards the creation of digital capability, which in 2016 replaced security as the top objective. This was mirrored on the IT investment side with a dominant swing in IT spending towards digital channels (both mobile and online banking), which have consistently been both top overall spend areas, and spend growth areas in recent years.
Interestingly, as revealed in the latest program, at the end of the decade another swing has occurred. Digital capability remains one of the top priorities; however, for the first time, legacy modernization is the top overall priority, with building the modern workplace (such as through enabling employees through collaboration platform and digital mobile workstyles) moving alongside digital capability creation as a core priority. This is driven by the realization that digital transformation is not just about the front-end digital channel experience, but it requires the ability for processes to be digitalized across the institution. While most institutions have effectively hidden many of the limitations of back office platforms from customer view at the digital front-end, banks need to modernize back- and middle-office systems if they want to create truly flexible, end-to-end digital services that enable rapid innovation.
Similarly, while firms are looking for greater automation, digital processes need to integrate and facilitate interaction with employees, both directly with customers and in enabling staff to complement and enhance the digital experience. Digital transformation is not just about replacing employees with IT interactions, but rather enabling the entire firm to support customers in the digital and physical world enabled by technology.
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