The banking industry has always been dynamic – constantly facing changes in the regulatory and competitive landscape. Over the years, many banks have successfully delivered small projects and adopted technology changes. However, the industry's track record with transformational change, which is required now, has been decidedly mixed.
Boards and regulators are now taking an active interest in investment portfolios and the oversight of systemic risks. The banking industry's current landscape is dominated by regulatory changes, with most banks directing 60–80 percent of their change spend on compliance. These changes are mandatory, deadline-driven and externally supervised. Some, such as conduct and standards, require changes in IT systems, processes, culture and behaviors.
In addition, banks are facing increased competition from both challenger banks and new entrants attacking lucrative parts of the value chain. In response, many traditional banks have embarked on strategic cost reduction, simplification and re-engineering.
But to retain and grow revenues, banks need to transform the customer experience with new propositions and digital channels. Digital resets the "clock speed" for change, requiring faster and more agile capabilities.