Digital innovation in FIs ‘hampered by the board’
Written by Anthony Strzalek
Technology departments in financial services firms are unable to innovate with technologies like artificial intelligence and blockchain because they have lost influence in boardrooms, according to a new report.
A survey of over 200 European IT decision makers commissioned by Excelian, Luxoft Financial Services reveals that 86 per cent of respondents have recently championed a major digital project that failed because it did not get past the boardroom.
IT executives believe misconceptions about technology by executives are partly to blame for these failures. For instance, 78 per cent agreed that senior executives do not understand technology and 81 per cent are frustrated by unrealistic demands to innovate with new technologies whilst also having to cut costs.
The report shows IT executives working in the UK are particularly frustrated by senior colleagues being unable to grasp new technologies – 85 per cent of respondents in the UK agreed that senior executives do not understand technology well enough, compared to 76 per cent in Germany, 75 per cent in Austria and 87 per cent in Switzerland.
The report also shows that although top executives want the company to innovate with technology and most understand its importance to the business, IT departments remain underfunded. 85 per cent of respondents said that the CEO understands the importance of technology within the business, but 78 per cent were frustrated by a lack of IT investment.
Roman Trakhtenberg, group managing director and global head of Excelian, Luxoft Financial Services, said: “Tensions in financial services IT departments are reaching boiling point. Technologists in finance want to be the gateway to the innovation but right now they are unable to influence decisions at the top.
“Instead, IT professionals in finance are stuck dealing with internal legacy systems and imminent cyber-risks, and are not getting the support they need to implement real change.”