Adoption of innovative solutions in a financial services organisation can be challenging, given the stringent requirements associated with the needs of regulation, compliance and security are complex and demanding. These requirements make life difficult for both the financial services firm trying to adopt new technological solutions and the vendor of those solutions. For many new FinTech companies this difficulty represents a major barrier to market entry.
The norm for the adoption of innovative solutions is for a bank to conduct a proof of concept (PoC). The PoC approach is often a time consuming and expensive exercise, therefore PoC’s are normally conducted only with the short-listed vendor of the solution and normally focus is on functionality rather than the wider compliance with the banks production GRC policies (Governance risk and control). The great drawback with this approach is:
1) limited vendor solution comparisons are made.
2) the costs are high.
3) time-to-prove can be long – building and assembling an environment for a PoC is often difficult and time consuming.
4) because PoC’s tend to focus on functionality, the post PoC implementation can be problematic. Vendor solutions often hit issues once selected and attempts are made to implement the solution into the banks real UAT (User Acceptance Testing) & production environments.
We think there is a better way. We have been developing a proposition to provide innovation-as-a-service utilising multiple distinct pieces of technology from within our group and coupling it with deep industry and innovation programme expertise to provide an end-to-end innovation service.
Starting with the Delta Capita Innovation Lab
We start a few steps back from the technology – why is the solution being adopted in the first place and is technology alone the answer? We walk through our methodology which starts with the vision, the strategy and then the proposition design – what problem are you trying to solve for and why are you trying to solve that specific problem? We can then take you through a tried and tested process to understand the key levers, the market, your customers, the trends and so on to identify the bespoke set of decisions you need to make to quickly get to an implementable innovation strategy. From our experience this must always be a business led conversation with a clear vision of the full problem statement rather than a technology one alone.
Bringing in our Innovation Platform
Once the innovation goals are clear, its key to understand how to move beyond good ideas and aspirations and make it real. So how do you ensure that those insights, decisions, and technology options are then taken forward in a strategic and robust way against key business metrics? That’s where our innovation platform comes to the fore, a combination of tech and expertise which helps define the functional and non-functional requirements and consistent KPI’s to sit across those to provide a multi-vendor assessment. This includes the collective experience of Delta Capita industry SME’s across strategy, technology and data science and novel PoC, testing and AI tooling to enable the creation of a simulated production environment. With this we are able to simulate API’s and mirror data sets to enable a PoC to be run and the proposed solutions behaviour to be tested against the banks policies and controls. The outcome is not only more efficient but will ensure much better outcomes when actual deployment takes place. By leveraging a PoC as a service capability it is also more economic and challenging to run a PoC therefore it becomes viable to run several PoC’s with difference vendors and therefore transforming and improving the vendor selection process. We have already used this combination of advisory and technology to create a component based innovation platform to deliver an innovation matching service for a government agency.
Our initial work assessing products for specific solutions settings has led us to the realisation that this approach can be extended to develop a platform for innovation. Normally when innovating today, most banks and vendors need to commit to prototype or even create an MVP (Minimum Viable Product) of a solution before it can fully assess the potential innovations worth. For example, a firm looking to innovate by offering a new customer solution leveraging the capabilities of open banking will often build a solution and then test the behaviour of the industries APIs (application programming interfaces) in the context of not only its functionality but how the banks controls and policies restrict the extent of its usage by extending the PoC-as-a-service concept the proposition becomes a platform for innovation where banks and vendors can effectively mock an environment and test an innovation concept prior to implementation, effectively accelerating innovation and ensuring a better outcome.
This is the world we envision – one where innovation isn’t a costly overhead but instead something which becomes a key pillar within financial services. One where the tech ecosystem can be easily assessed and safely integrated based on realistic KPI’s. Innovation will become even more critical to differentiation in our sector in the next decade and our approach to ‘innovation-as-a-service’ will be a big part of the solution. We don’t just ideate ideas and take you through an immersive innovation lab process, we then provide you with a proven platform to accelerate the innovation journey we collectively map out.
If you are interested to find out more or would like to speak to one of our experts, contact us here.
Sarah Carver – Head of Digital
Trevor Belstead – CIO Wholesale Banking & Post-Trade
Kevin Covington – Consultant