01 July 2016

New research: BPO allows financial institutions to focus on value-added business

Research highlights a clear evolution of wealth management and the growing trend towards outsourcing standardised processes, enabling wealth managers to focus on delivering added value for clients.

The survey, conducted by Wealth Briefing in collaboration with Avaloq and Deloitte, found 56 per cent of institutions believe that reducing the effort they spend on standardised processes in order to focus on value-added ones is an important or critical priority.

The research also confirmed the efficiency gains made through models such as Business Process Outsourcing (BPO) are fuelling differentiation and innovation in client and advisor technology, along with developing new products and services.

Being able to focus on their core business was confirmed as the biggest BPO driver by 85 per cent of respondents, followed closely by quality and efficiency at 82 per cent, and efficiency through industrialisation at 80 per cent.

The research also queried what kind of efficiency gains wealth managers are looking for when it comes to the business case for BPO. 93 per cent of institutions stated they would seek at least 20 per cent, whilst 58 per cent would want 30 per cent or more.

Thibaut Jacquet-Lagrèze, Head of Marketing at Avaloq, says, “The survey confirms what we have been experiencing over the past few years – a steady evolution of wealth management and a change in mind-set from what has been a highly traditional industry to a more agile way of operating. Companies have clearly seen the benefit in embracing outsourcing to make efficiency gains in processes considered as standard in order to focus on their core business and offer added value to their clients. The freed up resources have been ploughed back into client experience innovation.”

Patrik Spiller, Partner at Deloitte in Switzerland, adds, “Mainly medium to large-sized banks have the means to invest adequately in developing a market-leading and differentiated range of digital services. The smaller players will have to accept that it is tough to maintain a competitive advantage on technology innovation, and will thus increasingly outsource certain areas and focus more on positioning themselves around client management and product services.”

Thibaut Jacquet-Lagrèze concludes, “Avaloq’s wealth management customers continue to benefit from our investment and commitment in technology and services, so we can help them respond to the changing landscape, regulatory pressure and ensure they are able to meet changing client demands and boost their business performance.”

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