We’ve worked with our financial services clients over many years on a broad range of activities, from strategy development through to delivery of large-scale transformational change. However, it is far from business as usual in the sector at the moment. The industry is going through a significant period of change and there are many challenges that financial institutions are facing. But there are also some big opportunities. Below, we have highlighted four areas which are currently particularly relevant to many financial services organisations. They are also ones where we have both significant insight and capability.

Implementing regulatory reform and compliance
More significantly, however, many organisations are struggling to deliver successfully the scale and complexity of change that is required. With over 40 further pieces of European and UK legislation potentially coming into force over the next five years, including major elements such as MiFID II and MAR, the regulatory burden is unlikely to ease. Meanwhile compliance continues to be a major issue, as indicated by recent examples of major breaches of rules and regulations.

Managing operational risk
Since the financial crisis, the regulatory bodies have tightened up requirements on the management of operational risk significantly. Financial institutions are finding it hard to build the capability to identify and monitor risk to ensure compliance, especially when they are operating across so many markets and territories. This failure to deliver a more robust response to managing operational risk can be expensive both in terms of the significant fines being imposed for compliance breaches and the impact it can have on capital requirements.

Delivering digital transformation
The business world has increasingly become a digital world. As many financial services organisations are discovering, this is both an opportunity and a threat across the retail and wholesale markets. Making the most of digital opportunities and successfully landing the organisational transformation that this requires has become critical. The challenge is how to ensure differentiation by redefining and reinventing the customer experience. In retail markets this is particularly challenging, requiring insight into the needs of the next generation of financial services customers.

Exploiting big data and analytics
The combination of better analytics capabilities and the availability of large volumes of data means that ‘big data’ is more important now than ever before. The vast amount of data that most financial services firms have to deal with means that the opportunity to exploit ‘big data’ is particularly relevant to the sector, ranging from new customer insights through to enhanced fraud management and more effective operational management.