Transforming banking with cloud – the journey so far

By Puja Sharma

The cloud state-of-play report surveyed senior banking professionals across the Asia Pacific (APAC), EMEA, and North America, revealing key insights into how far banks have come in their transition journeys. The survey revealed that only 28% of banks, the “leaders,” have achieved transition of more than 30% of their applications in the cloud, as per the study on Future of cloud in Banking published by Publicis Sapient, a digital business transformation company.

The key obstacles to cloud banking were the following: Security concerns. Lack of cloud skills, And, a lack of internal understanding (highest among non-executive directors) of the business benefits

Retail and commercial banks will triple their use by 2025 and migrate more client-facing applications and data to the cloud. Three groups of banks can be identified: Cloud leaders, followers, and conservatives. Three groups have the same ambition to triple its use it. However, leaders place much greater importance on the business benefits of cloud-enabled transformation than Cloud conservatives.

Innovation at speed, the use of advanced analytics (such as AI and Machine Learning), the transformation of operating and business models, and the ability to seamlessly embed partners are included in this enhancement. Although leaders and conservatives agree that it reduces IT costs and increases automation, for conservatives reducing costs has been the main goal.

The two major obstacles to achieving its full potential are ambition and execution. First, more than half of executives and non-executives still underestimate the cloud’s transformative potential, which limits business transformation ambitions. The second concern is that participants do not fully benefit from existing investments due to security concerns and a lack of skilled people to implement them.

Level of cloud adoption

Based on their existing level of adoption, the study identified three distinct groups of banks. Most banks are somewhere in between, but there are just as many that are pulling ahead as falling behind.

Cloud Conservatives use it for no more than 10% of their apps. Adherents use it for between 11 and 30% of their apps. Leaders use them for more than 30% of their apps. Though adoption varies greatly, most companies want to double, if not quadruple, their cloud usage throughout their technology estates in the next three years.

Financial professionals must remember their bank’s ideal condition following transformation. It will enable certain features in the ideal cloud-enabled bank: Increasing the pace with which new products and services can be developed. Data – Improving data quality and application (e.g., personalisation, pricing, risk assessment) Automation entails automating and re-designing critical operations to cut expenses. Partners – Collaborating with capacity and channel partners in an ecosystem model. Lowering IT management costs and increasing IT resilience.

To fully take advantage of the potential of cloud-enabled business transformation at speed, a comprehensive, transformation program should achieve four key objectives:

• Align with business transformation goals, including value case and roadmap
• Integrate engineering, agile-at-scale, people, governance, and regulatory compliance to build enduring capabilities
• Migrate, modernise and rationalise applications/data and business processes
• Develop and scale enabling platforms, including data, API/Integration, Identity, and access management.