banks

Quantifying #Transformation | Numerix Video Blog Series

Understanding FinTech #Transformation: In this SECOND of a five part video blog series Jim Jockle, CMO of Numerix sits down with Paul Rowady, Director of Research at Alphacution to discuss the concept of #Transformation. Jim and Paul provide their perspectives on the latest examples of transformation they’re observing in the financial services industry specifically around the cross section of IT spending trends, software vs hardware investment, human capital expense, IT infrastructure, data management and risk analytics innovations. The five segments cover: Defining #Transformation within Financial Services Quantifying #Transformation The Cost of #Transformation #Transformation and TCO: Hewlett Packard Enterprise & Deutsche Bank Case Study Investing in #Transformation: What’s the ROI? Video 2: Quantifying #Transformation Jim: Hi welcome to the Numerix Video Blog I’m your host Jim Jockle. Joining me today continuing our conversation “Quantifying Transformation” Paul Rowady, director of research at Alphacution. Paul, welcome back. Paul: Thank you Jim. Jim: We started the conversation as it relates to the definitions of transformations and some of the work you’re been doing – [...]

By |2020-10-14T21:57:19-04:00April 26th, 2016|Video|
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Defining #Transformation within Financial Services | Numerix Video Blog Series

Understanding FinTech #Transformation: In this FIRST of a five part video blog series, Jim Jockle, CMO of Numerix sits down with Paul Rowady, Director of Research at Alphacution to discuss the concept of #Transformation. Jim and Paul provide their perspectives on the latest examples of transformation they’re observing in the financial services industry specifically around the cross section of IT spending trends, software vs hardware investment, human capital expense, IT infrastructure, data management and risk analytics innovations. The five segments cover: Defining #Transformation within Financial Services Quantifying #Transformation The Cost of #Transformation #Transformation and TCO: Hewlett Packard Enterprise & Deutsche Bank Case Study Investing in #Transformation: What’s the ROI? Video 1: Defining #Transformation within Financial Services Jim: Hi welcome to the Numerix Video Blog I’m your host Jim Jockle. Joining me today Paul Rowady, director of research at Alphacution. Paul, thank you for joining us. Paul: Good to be here Jim. Jim: Continuing our conversation on transformation a word that’s tossed around a lot, as an analyst, why don’t you [...]

By |2020-10-14T21:57:35-04:00April 19th, 2016|Video|
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#PassingTheBuck: Deutsche Bank / Hewlett-Packard Enterprise Case Study (Part II)

Part I of this post can be found here Here’s the central question: After one year, does Hewlett-Packard Enterprise deliver tech savings for Deutsche Bank? (And, is this a harbinger or a template for other large banks and market participants?) With the Annual Report and other financial disclosures released on March 11, 2016, Deutsche Bank (DB) has completed its 2015 reporting. Our original curiosity here was to determine if a technology outsourcing alliance between Hewlett Packard Enterprise (HPE) and DB – which was announced about a year ago in late February 2015 – has resulted in any observable impact on the technology spending patterns at DB. With a fully updated model in hand, the results provide some strong signals – and some additional curiosities. Here’s what we find: First, estimated year-over-year spending on hardware and infrastructure – a component of TCO where HPE is expected to have the most impact – is down $405 million 2015 vs. 2014, which represents an 8% improvement during the period – and is about [...]

By |2020-10-05T21:05:28-04:00March 16th, 2016|Open|
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#CrowdedOut: Banks’ Technology Spending Paradox

They really don’t have a choice here. And yet, in this “everything is customizable and personalize-able” world in which we now live, we have grown to expect that there is always an infinite spectrum of choices available. Not so much when it comes to banks’ spending on technical infrastructure. It turns out that internally-developed software costs (which we believe includes both proprietary and consultant-developed software) are the fastest growing component of our technology total cost of ownership (TCO) framework, which includes hardware, software, data and human capital. Of the 50+ large global banks that we have modeled so far, most of them throw off a similar picture as the one in the sample exhibit below of a large APAC bank. Here the accumulated net carry value of software is being driven almost exclusively by spending on internally-generated software – and far outstripping the growth in spending on computer hardware / equipment. Furthermore, it doesn’t matter if the bank is in the Americas, Europe, Asia or anywhere in between. Most of [...]

By |2020-10-05T21:05:04-04:00February 11th, 2016|Open|
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#DigitalMythology: The Searing Truth of Context

The primary goals of this ongoing series of research are to quantify - in increasing detail - what the members of the financial services industry (FSI) ecosystem spend on technology (including hardware, software, data and IT human capital) – which is sometimes referred to as (enterprise) total cost of ownership (TCO); develop benchmarks and analytics that help describe the absolute and relative nature of these spending patterns; and then, use the findings to confirm, deny, expand the prevailing (or introduce new) narratives in the space. The first phase of modeling has focused on the largest IT solution buyers, a selection of over 50 of the world’s largest banks – plus a few others whose purpose, for now, is to help us place this initial sample of FSI players in proper context. (More on this shortly.) Subsequent phases of modeling will incrementally build upon this foundation with the addition of other constituencies in the FSI ecosystem until a comprehensive view is maximized. With this as a backdrop, we have been focusing on [...]

By |2020-10-05T21:04:45-04:00December 6th, 2015|Open|
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#TechnicalVirtuosity: The Player is the Special Sauce

Once upon a time, a few clicks back into my youth from now, I fancied myself a fairly decent piano player. That illusion came to an abrupt demise when I met Fred Johnson. On the surface, Fred was as milquetoast-Midwestern as they come. You might have expected hay to fly out of his mouth when he spoke. But, that assessment would have been seriously flawed, as I soon learned. It turns outs that Fred was blessed with perfect pitch, had any number of the very long and complex Rachmaninoff and Prokofiev concertos perfectly lodged in memory, and the speed of someone afflicted with the gift of 25 fingers – and all by the 9th grade. He was a quintessential virtuoso as far as I was concerned. What Fred produced at the same piano and with a quick glance at the same sheet music as I had been laboring over for weeks were two entirely different definitions of music. In short, I would need to discover my own virtuosity away from [...]

By |2020-10-05T21:04:29-04:00November 19th, 2015|Open|
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#Technical Leverage: Can You Defy Your Scale?

If you believe the latest bromides, “IT strategy is business strategy”, then the success of any business is predicated on the deployment of technology – which includes the perpetual coordination of hardware, software, data and IT-related personnel (or human capital). Alphacution has applied this hypothesis to the financial services industry (FSI), first by modeling the technology-related spending of 51 of the largest global banks – arguably among the biggest buyers of technology in the FSI ecosystem – and then generating a series of benchmarks, analytics (many of which fall under the label, “T-Greeks”), visuals and narratives to describe how each market actor is performing in that ecosystem. Off the back of this first version of the Alphacution Composite Model, regional and global industry patterns also emerge, in addition to entity-specific metrics. Focus on Revenue per Employee One of the most fascinating pictures we have been able to generate in these early stages of the modeling is a normalized ranking of the sample banks by revenue per employee (RPE), where “employee” [...]

By |2020-10-05T21:04:20-04:00November 12th, 2015|Open|
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#DigitalTransformation: (More) Clues to Shifting Financial Services Technology (Part II)

The following is Part 2 in the series “#DigitalTransformation: Clues to Shifting FinTech” published on November 2, 2015. Digital crumbs don’t discriminate. They illuminate everything. True to this, and despite intense focus on cloud-based offerings, infrastructure-as-a-service (IaaS) and other managed services solutions, the digital transformation in the financial services industry (FSI) is by no means confined to hardware. Software development in FSI is in the midst of its own revolution, as well. In either case, and by my my estimation, overall fintech is now entering its third year of “white-hotness.” As a reminder, in Part 1 of this commentary, we highlighted growing evidence of the shift from capital expenditures (“capex”) to operating expenses (“opex”) for hardware and other infrastructure. In an upcoming post, we will dig a bit deeper into this theme by showcasing what the previously announced multi-billion dollar outsourcing deal between Deutsche Bank and Hewlett Packard (February 24, 2015) means for IaaS and other managed services adoption in FSI generally and for large global banks in specific – [...]

By |2020-10-05T21:03:54-04:00November 11th, 2015|Open|
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#GlobalTCO

Ever wonder what the global financial services ecosystem spends on technology? I have - obsessively. The size and shifts of this market – and the tapestry of moving parts within it – is extremely valuable intelligence for all players in the FSI ecosystem. Moreover, with the intense focus in recent years on topics like “XaaS”, clouds, solid state memory, Hadoop clusters and so many other symbols of fintech innovation it is abundantly clear that this is the one puzzle that needs to be solved. Problem is: crossing the bridge from here to there while keeping a credible process intact is sufficiently complicated to dissuade most sane contenders from attempting the feat. Of course, that is unless you are someone who thrives on solving insanely complex puzzles that defy common temperaments. Simply put: It all starts by following the money, which by the way is also a decent proxy for following the data. My Uncle Lewis was a stockbroker in Detroit for most of his 89 years. He was the kind of [...]

By |2020-10-05T21:03:02-04:00October 22nd, 2015|Open|
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