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Convergent disruption and the case for core transformation

Banks must strengthen their core platforms in order to outperform the competition and to support optimization, agility and innovation.


Banks today face convergent disruption—an array of challenges, including tougher regulations, traditional and non-traditional competitors, and digitization. To stay competitive in this emerging environment, to continue to improve customer experiences and business outcomes, they should continue to invest in and strengthen their core platforms or face steadily declining performance.

Whether they are contemplating ways to enhance their core platform or they decide on a complete transformation, bank executives need to ask themselves key questions about their core’s capabilities and whether it’s scalable, flexible, dynamic and agile.

Given the challenges facing the industry today, banks have little choice but to strengthen their core platforms to outperform the competition and to support optimization, agility and innovation.


Despite making substantial progress since the financial crisis, banks must still contend with tougher regulations, traditional and nontraditional competitors, and digitization. Accenture calls this array of challenges “convergent disruption.”

To compete in this environment banks need a next generation core platform capable of supporting three key operational building blocks for competitive advantage by 2020:

  • Optimization and simplification (having a structure as efficient and effective as possible).

  • Agility (being able to seize opportunities in times of change).

  • Continuous innovation (having the ideas, vision and leadership to proactively stay ahead of the market)

By identifying the key characteristics of these building blocks and understanding what a next generation core banking platform looks like in action, bank executives can better assess their own core banking environments and answer a critical question: “Is my bank’s core platform an enabler to achieving these three building blocks of competitive advantage—optimization, agility and innovation—or is it an inhibitor?” The answer to this question will dictate the pace and scope of the core transformation necessary at a bank, whether it’s full core replacement, remediation or evolutionary transformation.


Whether bank executives are contemplating how to improve their core, are in the midst of “enhancing” their core or have recently completed a core project, it’s worth asking themselves several key questions:

  • Do their core capabilities support their “digital” ambitions?

  • Have they implemented a true end-to-end digitized process, to achieve a “zero back office”?

  • Is their platform scalable? Can it truly fulfill the promise of being multi-country, multi-tenant and multi-business?

Along with these familiar core capabilities are a set of emerging characteristics, which bank executives need to consider. Is their platform flexible, dynamic and agile. Does it provide the ability to:

  • Add new functionalities, such as personal financial management and other new offerings or services?

  • Personalize the customer experience for every customer based on the customer needs and on the contextual information at any point of interaction?

  • Integrate third-party services, such as non-financial offerings and personalized data feeds, and provide services to third-parties, such as credit reviews and payments engines, to create new value-added services to customers without adding layers of complexity and cost?

Given the convergent disruption engulfing the industry, banks have little choice but to strengthen their core platforms to make them more flexible, dynamic and agile. Whether a bank views itself as a first mover or fast follower, to outperform the competition and not simply survive, it needs a core with the right capabilities and characteristics to support optimization, agility and innovation.