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Banking shared services through captive or business process outsourcing

In an ever-changing regulatory environment, a shared services model can help weather the storm

Overview

A more stringent—and continually changing—regulatory climate means financial institutions are struggling for stability around revenues, costs and business models. In response, banks have been evolving their operating models and dabbling in shared services. They have worked to manage costs by expanding their shared services capabilities and by tapping to in-house captive centers, typically off-shore.

A shared services model offers a good path. A high-performance shared services model can help businesses standardize processes and technology, building new efficiencies.

But Accenture believes a strong shared services model can deliver even more gains for financial institutions.

DOWNLOAD ENABLING BANKING SHARED SERVICES THROUGH CAPTIVE OR BUSINESS PROCESS OUTSOURCING [PDF]


The core issues faced in this increasingly complex regulatory environment can be alleviated using a shared services model.



Key findings

An effective shared services model can help address several concerns for banks and financial firms, including:

  • Complex, duplicate, costly, non-standard processes
  • Multilayered, top-heavy organization
  • Duplicative, siloed and regionalized infrastructure
  • Excessive management time spent on transactional activities, and not enough on value-add and revenue generating work
  • Disparate data, reporting and many versions of the “truth”
  • Staffing to support peak demand periods

With a mature, high-performance shared services model, financial firms could:

  • Lower location and resource costs
  • Reduce working capital
  • Reduce staff and processing expenses as well as systems infrastructure expenses and costs
  • Invest in an organizational structure capable of supporting growth
  • Standardize processes and systems
  • Reduce cycle times for key processes


A high-performance shared services model can provide a bank with an opportunity to redesign its processes around preferred practices.



Recommendations

Seeing the benefits of a shared services model won’t take long. After launching a new, strategically placed shared services center in a lower cost location, financial institutions could begin seeing labor arbitrage savings within one or two years.

The key is to implement not just any model, but a fully functioning high- performance model, which can deliver early benefits and continue to reap efficiencies and savings down the road.

DOWNLOAD ENABLING BANKING SHARED SERVICES THROUGH CAPTIVE OR BUSINESS PROCESS OUTSOURCING [PDF]