2CLOUD AND CLEAR
After many years of hype, but little
change, there is now compelling evidence
that banking is truly being disrupted by
digitization. Across major banking markets,
there is a proliferation of new competitors,
with 19 percent of all institutions new to
the market since 2005. In the UK—the
most disrupted developed market—around
14 percent of retail and commercial
banking revenue has migrated to new
entrants, and multiple neo-banks have now
passed the 1 million customer milestone.1
Like other industries, banks are struggling
to respond to disruption and build the
systems they need to compete in the
digital age because of the limitations
of legacy IT systems. The cloud offers
a way for banks to quickly develop new
applications, add new online services
and improve customer experience.
Indeed, offerings such as mobile banking
would be impossible without the cloud.
Also, data-intensive applications such
as artifcial intelligence (AI) and complex
data analytics that are increasingly
important to banks, are typically cloud-
based and indeed some of the most
advanced AI technology available is now
embedded in public cloud platforms.
Hence, 53 percent of respondents to
an Accenture and Oxford Economics
survey within the retail banking industry
believe cloud-based technologies
are having the biggest impact on
improving the operational effciency
of their industry and 40 percent of
respondents in the same survey believe
cloud-based technologies generate
business value for their industry.2
Banks recognize the need to build future
IT systems on cloud platforms, and there
are pockets of cloud deployment across
most banks. But many banks still lack a
comprehensive cloud strategy that will
enable a rapid shift to the cloud, and very few
have defned an enterprise-level operating
model for transferring existing applications
to the cloud and systematically adding
cloud-based applications and capacity.
These are some of the central fndings
of a recent survey of 35 retail banks
conducted by Accenture (see fgure 1).
Based on this Accenture Cloud Readiness
report, we conclude that many banks
risk falling behind their competition
because they have not laid the foundation
for a rapid and orderly transition to
fexible cloud-based systems. Given the
increasing level of market disruption,
banks should urgently develop a cloud
strategy aimed at scaling cloud usage
throughout the enterprise, creating
detailed plans and timetables for
cloud implementations, and building
capabilities to manage cloud-based
systems—including managing security
and remaining compliant with regulation.
TIME TO PICK UP THE
PACE – THE URGENCY
OF CLOUD ADOPTION
1. Accenture Research Analysis
2. Accenture - Oxford Economics study - in development and report to be published in October 2018
CLOUD AND CLEAR3
MISSING: A CLOUD
STRATEGY AND
IMPLEMENTATION
PLAN FOR CLOUD
Why is a cloud strategy and implementation plan so important
The answer: it’s becoming very bad for business not to have one.
In a sense, not having a cloud strategy
and comprehensive plan means not
having a complete business strategy,
since cloud capabilities are now
so fundamental to how banks will
conduct their businesses and grow in
the future. A clear cloud strategy and
plan, developed in collaboration with
the business units, sets priorities for
adding new cloud-based applications
and transferring existing ones to cloud
platforms to give the organization
greater fexibility and effciency and
enable innovation and growth.
Figure 1. Survey demographics: 35 executives (CIO, CTO, CISO and VP IT) at global retail banks
NA: Canada, United States
EU: France, Germany, Italy, Spain, UK
LatAm: Argentina, Brazil, Mexico
Africa: South Africa
APAC: Australia, China, Japan, Singapore, Thailand
Source: Accenture Research (Sample Base: Total Sample)
9%
48%
14%20%
$500 million to US$1 billion
Over $1 billion to $5 billion
Over $5 billion to $10 billion
Over $10 billion to $15 billion
Over $15 billion
9%
6%
29%
17%
31%
17%
4CLOUD AND CLEAR
Figure 2. Which statement best describes
your organization's current cloud strategy
Core cloud practices and critical tools are in place
We have agreed upon some basic practices and have begun
to implement tools
We do not have a cloud strategy yet and have not started
to think about it
Core cloud practices and critical tools are in place and we have
ongoing measures of efficiencies for continuous improvement
Source: Accenture Research (Sample Base: Total Sample)
40%
3%
31%
26%
However, 43 percent of banks in our
survey say they do not have a cloud
strategy or have only started to implement
basic cloud practices (see fgure 2).
In most of these banks, cloud
architectures and technologies are
found in pockets and do not exist in a
comprehensive form at the enterprise
level, even among banks that say they
have developed a cloud strategy.
And, while 83 percent of respondents
say that IT has had “preliminary” or
“thorough” discussions with business
units about cloud strategy, two-thirds
said that fewer than half of their lines
of business are currently using cloud.
Not surprisingly, the lack of a cloud
strategy has resulted in limited cloud
deployment. Less than half of banks
responding to the survey (46 percent)
have for example implemented cloud-
related automation, self-service and
orchestration tools. This means that
most of these banks are only at the
“experimental” phase in developing cloud
infrastructure, modernizing applications,
and building cloud-management tools.。