Published on October 29, 2023, 9:39 pm

TLDR: Digital business transformation is an ongoing journey that requires organizations in the financial services industry to adapt to new technologies and best practices. This includes legacy application modernization, cloud migration, and the rollout of new applications. Low-code application development can be impactful for workflow automation, but security vulnerabilities need to be considered when external parties handle the coding. Financial institutions must manage risk, optimize costs, increase efficiency, and stay ahead of industry landscapes to ensure successful modernization efforts.

Activities like video conferencing, mobile work, and cloud computing have been prevalent for quite some time now. However, in recent years, digital transformation has taken on a new meaning. It involves initiatives and technologies that align an organization’s people, processes, and technology with its core business objectives and future vision.

Digital business transformation is not just a one-time project or technology implementation; it is an ongoing journey that evolves over time. Staying updated with the latest technological innovations and best practices can be challenging, especially for businesses in heavily regulated industries like financial services.

According to Gartner, technology spending by banking and investment services is projected to grow by 6.1% in 2022 globally. Moutusi Sau, VP Analyst at Gartner, emphasizes that while growth is a priority for these organizations, managing risk, optimizing costs, and increasing efficiency also require new technology innovations.

Financial services CIOs face continuing volatility and the need to master new rules for digital business and innovation. Regulators in Asia actively monitor and manage the industry to mitigate external and internal threats to normal operations. Rajesh Nandakumar, head of Information Technology at Westpac Institutional Bank Asia, highlights the efforts of the Monetary Authority of Singapore (MAS) as they keep an eye on both innovation and security.

Legacy application modernization (including cloud migration) and the rollout of new applications are critical considerations for organizations. Nandakumar explains that while legacy applications provide solutions for banks’ needs, challenges arise when there are no more updates from the service provider on hardware. Upgrading these applications or considering retirement, migration to a new platform, or rewriting the code becomes essential before moving to the cloud.

Software development cycles often face issues such as writing applications on outdated technologies without possibilities for advancement or finding related resources. Testing cycles for production rollouts or new features require proper testing spaces. Additionally, finding the right talent is always a challenge.

Low-code application development can be impactful within organizations, particularly in workflow automation. Nandakumar suggests considering internal resources who can control and manage low-code development in shorter time frames compared to external parties. This approach helps organizations see through the software lifecycle and attend to their needs internally.

As for the future of low-code or no-code development platforms within financial services institutions, there are concerns regarding security vulnerabilities if external parties handle the coding. IT departments should take responsibility for ensuring proper integration into the company’s ecosystem and implementing necessary security measures.

In summary, digital business transformation is an ongoing journey that requires organizations to adapt to new technologies and best practices. Financial services institutions need to manage risk, optimize costs, increase efficiency, and stay ahead of volatile industry landscapes. Legacy application modernization and the rollout of new applications are essential for organizations planning their digital transformation. Low-code application development offers potential benefits but requires careful consideration of security implications. Ultimately, maintaining a strong ecosystem integrated with reusability assets is crucial for successful modernization efforts.

To learn more about this topic, you can listen to the podcast episode titled “Futureproofing the enterprise’s modernization journey” on FutureCIO’s website.

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