FSC-DST CEO Report
Nearly all CEOs (96%) in a recent survey believe technology is a key consideration when conducting strategic planning and an overwhelming majority (80%) believe technology plays a major role in innovation and delivering new financial products.
These are the findings of the 13th annual FSC-DST CEO Survey based on the views of 55 leading CEOs in Australia’s financial services industry. This year’s survey focused on the sentiment of Australia’s leaders towards doing business with Asia.
When looking at the role of technology in exporting to Asia, 55% of CEOs agree that online services and innovation are important in developing financial products for the Asian market. A similar number agree that it is important to continually invest in technology to take advantage of growth in Asia.
“Today's dynamic marketplace demands that financial services providers place emphasis on technologically advanced feature-rich solutions that can operate real-time across jurisdictions and reduce operational risks,” said DST Bluedoor Executive Director, Martin Spedding. “Australian financial services firms can gain efficiencies by exporting technology infrastructure into Asia and the global marketplace to help expand their footprint and leverage a single operating model across markets.”
Among those CEOs currently undertaking strategic-based IT projects, the survey found that a key focus is on back-end systems technology to support new product development, and customer interface systems, such as mobile app projects, that keep clients informed about investment performance.
Several CEOs noted that the financial services sector needs to match the developments in the banking sector in terms of using mobile technology applications to better communicate and interact with customers. The report found that 56% of CEOs agree that having a mobile-based customer service strategy is important to capitalise on Asian growth.
“A big driver of change for the industry is the rapid adoption of technology by consumers, including tablets and smart phones,” said Spedding. “This evolution will have a significant impact on the Asian financial services sector as it becomes increasingly focused on selling direct to consumers.”
On a local front, most CEOs expect their IT budgets to increase over the next two years driven by a desire to achieve productivity gains in order to stay competitive and to meet new regulatory demands. The report found that CEOs expect the level of IT investment to increase under FoFA and SuperStream reforms.
“The demand for better risk and compliance management along with the need to be more productive and transparent is placing pressure on systems. Since many industry participants are under-invested in technology, it’s not surprising that budgets are expected to increase,” Mr Spedding said.
John Brogden, CEO of the Financial Services Council said: “Improved technologies and innovation will help the financial services industry to operate more efficiently and to meet complex regulatory changes encompassed by the Stronger Super and FoFA reforms”.
“The financial services industry has a major opportunity to harness new technology to develop leading services and products that will give it a competitive edge for its next growth phase.”
The Financial Services Council conducts an annual survey of its member CEOs on the key issues affecting their businesses, the financial services sector more broadly, and the Australian economy. This year the survey also canvassed CEOs’ views on the challenges and opportunities in Asia. These views are collected via a member survey, a series of roundtables and, one-on-one interviews. The 2013 survey was done in conjunction with DST.