• COVID-19

    • Government Sector Whitepaper
      Effective management of information systems and communications is critical for the success of the public sector.

      Mining Sector

      Increase productivity & build a culture of innovation

      Financial Sector

      Meet the challenges of disruption & cyber security

      Healthcare Sector

      Empower your patients & leverage data by deploying customised solutions

      Retail Sector

      Embrace the changing retail landscape & know your customer

      Government Sector

      Use digital transformation to grow the economy & build capacity

      Industries Overview >

    • Innovation Through Simply Navigating The Complex

      Specialized digital diagnostics, solutioning, consulting, development and maintenance across legacy and cloud-based systems.

      Digital Innovation Awards

      BCX Digital Innovation Awards 2021

      BCX Exa

      Innovation through simply navigating the complex

      Digital Transformation

      Intelligent systems upgrading

      Analytics

      Data that works for you

      Applications

      Tools to streamline operations

      Services

      Strategies for efficient ICT

      Cloud

      Computing for today & the future

      Cybersecurity

      Protection for your critical systems

      Devices

      Processes & network foundations

      Connectivity

      Connections within & without

      Partners

      Partnerships moving business forward

      Solutions Overview >

    • Speak To An Expert
      We'll need just a few details from you, and one of our specialists will be in touch as soon as possible.
      BCX HEAD OFFICE

      Employee Entrance:

      1021 Lenchen Avenue North
      Centurion
      Gauteng
      South Africa
      0157

      Contact Us:

      +27 (0) 11 266 5000

      Visitors Entrance:

      1266 South Road
      Centurion
      Gauteng
      South Africa
      0157
Home > A Legacy of Transformation

A Legacy of Transformation

24 August, 2021

The financial sector faces a crossroads as legacy infrastructure meets disruptive transformation

The financial sector has been pressured by digital and disruptive change for years, few emerging as diamonds from the rough. Many are struggling to find a foothold in a world that’s refined and redefined by customer whim and demand and, according to McKinsey, have been pushed to find smart and inventive ways to modernise legacy IT architecture, even areas that were previously considered sacrosanct. From risk, finance, and compliance to accessibility and simplicity, financial service providers need to modernise systems or lose ground to the fresh new faces that are taking the lead. According to Nkosi Kumalo, Managing Executive: BCX Exa, modernisation is all about taking legacy applications and optimising them to fit with what users want.

“The advent of mobile solutions and pervasiveness of the internet has made it possible for users to access applications outside of their working environments,” he continues. “In the past, older systems wouldn’t allow users such freedom and engagement with customers was physical, slow and complex. Now, the key words are access and immediacy, and customers vote with their clicks. Organisations need to not just optimise the look and feel of apps but look at the whole stack from where the applications are hosted to where they are consumed.”

This is a view shared by the McKinsey report ‘How banks can achieve next-generation legacy modernisation’. For the research firm, modernisation requires a ‘comprehensive effort that encompasses the data stack’ as this allows for the company to embrace a flexible data approach that leverages legacy while ensuring modern immediacy. The financial service sector sits right in the heart of technology disruption – incumbents face relentless competition from the young and the hungry, as well as the weighty behemoths with an agile twist in their offering.

“There are people alive today who used a chequebook, and that’s now been discontinued by most companies in South Africa,” says Kumalo. “Few people even carry cash now. Bank cards, digital payment solutions, EFT – these transactions are playing in the digital realm, powered by the internet. For financial institutions more than 100 years old, this is a radical shift in thinking. It’s also a radical shift in systems. Banks need to look at what legacy can offer them for the future, and step out of the mud if they want to compete effectively on the global stage.”

The chequebook, the counter service, the complex paperwork, the limitations of debt and credit. These traditional ways of banking and managing cash are being eroded by digital natives and by financial sector disruptors that aren’t focused on traditional limitations, and by changing regulations. In the past, moving bank account was a challenge that could negatively impact a person’s credit rating. Now, people can move accounts with ease – jumping to service providers that offer better, well, service.

“When these born in the cloud banks overcome the initial bugs and glitches that have limited their uptake and service delivery, they are going to fly,” adds Kumalo. “The problems they’ve encountered are temporary – teething issues as they navigate new ways of finance and customer engagement. But the big banks face the same teething problems, the same journey. And if they wait too long, the customer will choose for them, because once you’re irrelevant you don’t have a business.”

The financial sector has to build pathways to relevance by putting the customer at the centre of everything. If a bank doesn’t understand how its customers engage with it, then it will become irrelevant. This is the time to step outside the business, to unpack what needs customers have and what they are asking, and to use the tons of data generated by multiple systems and services to truly refine every part of this process.

“The sector can’t afford to ignore the value of the data sitting in legacy systems, otherwise how will it understand what customers are looking for? For example, look at how many people were rejected for a credit card this week and find out why. Uncover the metrics that are limiting customer retention and uptake and find out how you can change these to gain better customer traction. If you don’t, the customer you rejected today will be somebody else’s customer tomorrow.”

This is the picture that’s already been painted by disruptive banks in South Africa. Banks that have stepped into previously underserviced communities and provided them with banking solutions that were previously held out of their reach by traditional companies. These are the financial institutions reshaping who banks, how they bank, and where loyalties lie, and this is where the battle really lives.

“Modernising infrastructure is essential to competitive growth and advantage,” concludes Kumalo. “The financial sector is on the cusp of a new world of financial work, so this is the time to leverage machine learning, data science and analytics, and to build the apps that help you to capture the opportunities.”

Share

SPEAK TO AN EXPERT

 We'll need just a few details from you, and one of our specialists will be in touch

Consent
Please read our Privacy Statement & Consent Clause to understand what happens to your personal information.

RELATED POSTS