Managed services will play a vital role in helping financial services providers boost their back-office functions and re-focus resources on strategic initiatives that can help drive performance and growth across Africa
So says Brian Anderson, head of business development at SunGard SA, who is of the view that SA has experienced rapid growth in consumer adoption of financial services, and its corporations and state-owned organisations are becoming increasingly sophisticated in financial management.
According to Anderson, the country's finance industry is, therefore, under pressure to cater for increased demand for financial services; address diverse regulations; and improve operational performance. This is driving a greater need for firms to strengthen their systems and processes, he says.
In a statement, SunGard says South African financial institutions continue to face a wide range of business challenges that are driving the need to manage risk, control costs, accelerate innovation and enhance operational efficiency.
As firms strive to meet these growing requirements and build smarter operations, SunGard has identified trends driving the adoption of managed services in SA over the next 12 to 18 months.
According to SunGard, security concerns will drive financial services providers in SA to favour outsourcing ventures with proven companies that can demonstrate superior security, resilience, scale and a strategic advisor approach.
Also, with more capital being diverted to manage new regulatory requirements, firms are increasingly migrating operations to managed services environments in an effort to control risk and costs.
It notes that to instil best practices and smarter operations, businesses will look to consolidate their vendor relationships and achieve systems rationalisation through outsourcing.
SunGard points out that the need to ensure regular and seamless upgrades to mission-critical applications is resulting in more institutions outsourcing day-to-day maintenance, particularly in the state-owned sector, as they are under pressure to upgrade ageing infrastructures but face funding challenges.
Also, outsourcing certain technology functions will help free up financial resources, allowing them to maintain overall control of business processes and focus on their core objectives, SunGard says.
It points out that siloed infrastructures are slowing innovation and hindering go-to-market strategies for new products, negatively impacting growth initiatives.
"This is driving South African firms to invest in managed services that can scale to span multiple operating units and end-to-end processes across Africa," says SunGard.
"The South African financial services industry is experiencing new challenges including growing consumerisation and the rise of technology-centric business models. Coupled with increased competition, these are driving organisations to embrace more agile ways of running their operations," says Wayne Speechley, executive, cloud and communication at Internet Solutions.
In conclusion, SunGard believes that adopting managed services will allow firms to focus on their core competencies and be more responsive to market trends and opportunities.
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