Increasingly, banks are competing in terms of tech-driven innovation, but their slow adoption of cloud technology may impede their progress, warns a report from global professional services company Accenture published Thursday.
The report, based on a global survey of 35 banking executives, 48% of which are from Canada and the United States, finds only about one quarter (26%) of banks have a “solid cloud-adoption strategy.”
“With many banks facing flat growth, pressure on margins, and weakening customer satisfaction, timely cloud adoption offers a lifeline. It could give banks the elasticity to meet changing demands, develop new applications faster, add online services quickly and help improve customer experience,” the report says. However, many banks “are not moving fast enough to avoid potential disruption.”
According to the Accenture survey, banks are focused on moving disaster recovery capabilities to the cloud (80% of respondents) and data backup functions (74%).
Banks have also identified the sorts of legacy systems that would most benefit from shifting to the cloud, such as retail customer access (65%), foreign exchange (60%), and regulatory reporting (40%).
However, there are two key obstacles to transitioning these areas to the cloud, the report says. Specifically, legacy systems and a skills shortage are factors holding back banks.
“The cloud provides extraordinary opportunities for banks to transform how they conceptualize, develop, manage and sell their products and services — but this can’t be accomplished without the right talent in place to advance the cloud agenda,” says Chad Duncan, managing director in Accenture’s Financial Services technology advisory practice, in a statement.
“At the same time, our research shows that many banks still lack a comprehensive strategy to rapidly shift to the cloud, leading to limited deployment. Because cloud is fundamental to how banks will conduct business and grow in the future, it’s time to move past the experimental phase and put an aggressive cloud transition strategy in place,” he adds.