Key Challenges Facing Financial Services Companies

Most financial services companies continue to face significant pressure from a number of directions.

Market issues

In an increasingly competitive marketplace, successful players are focused on customer retention. Improvements in retention levels can often be achieved by improving the approach to customer management and customer segmentation. There is also a need to address increasing customer expectations for price and service. In many cases this is leading to increasing market commoditisation.

Regulatory issues

Regulation has reached such a level that many organisations are focused almost entirely on meeting regulatory requirements. This is causing businesses to put at risk other initiatives required to maintain a competitive position in the market. Examples include:

  • Widening scope of FSA (e.g. to cover insurance and building societies)
  • Basel II (operational risk, changes in capital requirements)
  • Move to International Accounting Standards
  • The Sarbanes-Oxley Act
  • The Patriot Act
  • The Combined Code on Corporate Governance
  • Prevention of money laundering
  • Mortgage Conduct of Business

Operational issues

Globalisation, consolidation, convergence and the increasing focus on competitiveness are all driving the need to improve the efficiency and effectiveness of operations:

  • Cost control remains a management imperative.
  • Operational risk systems and controls (driven by regulation) are necessities not options.
  • Business process management (BPM), business activity monitoring (BAM), corporate performance management (CPM) and employee performance management (EPM) are all rising up the list of priorities.

Technology issues

All of this change – in the marketplace, in the regulatory environment and in operations – means that there is very often a need to replace and upgrade infrastructure, hardware and software.

Meeting such a complex, interwoven set of challenges calls for pure 'been there, done that' experience – the kind of hands-on, practical know-how the Charteris Financial Services Practice has in abundance.

To learn more about what we can do for you in this area please call Barry Hargrave, Head of our Financial Services Practice, on 020 7600 9199 (UK head office) or Roger Woods, Head of our Scotland and Northern England Practice, on 0131 477 7741 (Edinburgh office).