Optimizing Operational Efficiency In Global Banking

By M. Isi Eromosele

It is imperative that the business operations of financial institutions must be updated and standardized, with the latest applications deployed. Subsequently, operational efficiency needs to be looked at and optimized.

Scope for improvement should be sought in all areas, including enterprise resource planning, financial planning, customer relationship management, supply chain management and human resources. Greater efficiency will improve employee productivity and reduce costs.

Supply Chain Management

Physical supply chains with suppliers and distributors change over time and become stressed during periods of price volatility, fluctuating demand and slow economic growth. With the right supply chain management software, however, companies can build and operate world class value chains to cope with these stresses and strains and generate profitable growth.

Such software will integrate and automate all key supply chain processes, from design, planning and procurement through to manufacturing and delivery. It will allow them to anticipate market requirements and risks, adapt and innovate to respond to volatile market conditions and align operations across international networks.

A unified data model will provide a single, accurate view of a bank’s entire supply chain and enable them to implement lean, demand-driven principle and manage complex global supply chains.

Human Resources Management

All people-related activities including hiring, salaries, communications, training and development, redundancy and dismissal need to be managed, preferably from a central hub. Sophisticated human resources management software will be able to handle all of this. It will:

• Automate key processes and workflows to speed up recruitment, budgeting, pay, performance, training and more
• Provide a single view of staff through a global HR database, including addresses, banking details and other information
• Manage remuneration, allowing the bank to attract and retain the right people with the right combination of salary and benefits
• Locate and manage talent globally. This will include hiring and training the most talented people available
• Integrate business intelligence with HR management, thereby aligning the workforce with corporate objectives

Simplifying Technology Infrastructure

Technology plays a vital underpinning role in virtually every aspect of banking operations. But it is inherently complex and if it is allowed to get too complicated, its efficiency and effectiveness is likely to suffer, with serious knock-down effects for operational and business efficiency.

The problems are many and varied: too many diverse systems and applications acquired over time often as a result of mergers and acquisitions; inefficient legacy applications and systems that possibly should have been retired years previously and rigid infrastructures. All of this leads to reduced system performance, rising costs and higher error rates.

Technology complexity therefore needs to be carefully managed by the Chief Information Officer and his team in terms of both infrastructure and applications. Simplifying the infrastructure, for example will necessitate reviewing the following:

• Service-oriented architecture (SOA), which links disparate applications across many different business lines and functions, thereby centralizing and improving process efficiency.
• Middleware, which is also used to integrate disparate applications across the organization.
• Database machines, which provide extreme performance for both data storage and online transaction processing applications.
• Servers and storage systems, which deliver mission-critical, process performance and storage capabilities.
• Cloud computing, which delivers information and services over the internet from an external provider’s hardware and software.

Service-Oriented Architecture (SOA)

Integrated applications and centralized processing are essential for modern, efficient banking. To achieve these technological and operational goals, SOA is essential. SOA will interoperate with all parts of the technology architecture to integrate all business applications, moving them on to a common service bus and a common workflow engine.

The key benefits will include:

• Integrating and standardizing all applications in a short space of time.
• Centralizing and improving process efficiency
• Reducing costs
• Increasing scalability
• Improving visibility
• Enhancing security

Call To Action

When banks embark on any kind of modernization program, they need to review their technology and make sure it is fit for purpose. Where it is not fit for purpose, it needs to be re-purposed and upgraded.

Where existing systems and applications are deemed to be still useful and are left in place, their suitability and effectiveness must be monitored regularly.

There are many different possibilities available to banks in terms of new strategies and operating models. But a modernization program will only be truly successful if the technology implications are fully understood and best-in-breed applications and infrastructure are deployed.

M. Isi Eromosele is the President | Chief Executive Officer | Executive Creative Director of Oseme Group - Oseme Creative | Oseme Consulting | Oseme Finance

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