Every business is a technology business. As clichéd as it sounds, it’s true and is evident by the investments banks have made towards digital transformation to enhance the customer experience and optimise their operations in response to the pandemic.

Leaders in the banking sector will continue to embrace innovative technologies to transform their business and widen the digital achievement gap – the difference in revenue performance – between them and their less-digital peers.

In keeping with tradition, we recently released our Banking Technology Vision 2021 in which we examined the five trends that have the greatest potential to disrupt and shape the future of banks.

Some 99% of the banking executives surveyed for this research agreed that the pandemic had created an unprecedented stress tests for their organisations, with Technology Architecture voted as the area that had experienced the highest stress test.

It’s no surprise that the first trend in the Tech Vision is “Stack Strategically.” The rapid pace of technology change and the influx of new technologies has elevated the choices of technology architecture to influence differentiating and winning strategies for banks.

Nearly 90% of respondents said that their ability to compete would depend on the limitations and opportunities of their architecture.

The increasing significance of technology strategy and architecture was a prominent theme of discussions across clients and industries at our Cloud Week, held earlier in 2021. So it’s no surprise that 94% of the Tech Vision respondents told us that in the next three years, their banks will have at least half of their business in the cloud. This implies more choices and complexities associated with hybrid, public and private cloud and thereby requiring orchestration across the entire cloud continuum.

Add to that the plethora of as-a-service solutions, which are becoming more accessible due to increased cloud readiness and cloud-first strategies that are being adopted by banks.

In essence, we are talking about uniquely designing each layer of the technology architecture to leverage the abundance of choices available. In doing so, banks can create the necessary competitive edge, agility, modularization and enablement for innovation to deliver on their purpose.

This is easier said than done, as most banks are hindered by their legacy systems and architectures. When these organisations implement cutting edge solutions, they often fail to design for future adaptability.

Bringing it home to South African industry, one of the big focus areas is improving customer and employee experiences and doing this at speed.

But making changes is a time-consuming process when the underlying systems are tightly coupled monoliths. Any change has a ripple effect that impacts the various layers of the system. This is compounded by the need to do extensive testing, to get into the release queues, and more.

Moving to a modern “decoupled” architecture, which is microservices-enabled and allows for plug-and-play solutions that are fit for purpose, is the way forward.

This allows for change to be isolated and implemented in a nimble way. The various layers of the systems can innovate and change at different speeds independent of each other. The result is that banks are enabled by much needed agility to launch digital products and services and be responsive to changing customer needs.

To thrive in an extremely competitive and innovative industry, banks need to make the right technology choices that enable them to orchestrate unique propositions for their customers while having the necessary operational efficiency and agility.

They also need to build trust in their customers, and this trust has to extend beyond the brand to the underlying technology for their products or services, as that forms an important part of the banking infrastructure with the continuous focus on digitisation.