This report presents the findings from a survey of 158 financial market institutions regarding their approach to Information and Communication Technology (ICT) procurement. The survey investigates the way that financial market institutions like to purchase technology, as well as the major IT and business objectives influencing their IT investment strategies.
Introduction and Landscape
Why was the report written?
To highlight the criteria on which financial market institutions select their IT providers as well as the roles which have influence while making IT purchasing decisions.
What is the current market landscape and what is changing?
Financial market institutions are keen to deploy their technologies on-site as they have to adhere to strict compliance regulations relating to data security. However, institutions are gradually shifting their business processes (which do not involve confidential data) to hosted deployments.
What are the key drivers behind recent market changes?
Kable believes that enterprises in the capital markets are gradually shifting their focus towards hosted deployments, primarily driven by advantages such as reduced IT costs and improved scalability and flexibility.
What makes this report unique and essential to read?
Kable Global ICT Intelligence has invested significant resources in order to interview CIOs and IT managers about their IT Procurement. Very few IT analyst houses will have interviewed 150+ ICT decision makers in financial markets in H2 2012.
Key Features and Benefits
Provides insights into financial market institutions' preferred buying approaches.
Comprehend the business objectives that financial market institutions are looking to achieve through their IT investment strategy.
Appreciate the IT objectives that financial market institutions are looking to achieve through their IT investment strategy.
Understand the factors that are influencing financial market institutions' decision to select an ICT provider.
Understand which organizational roles influence IT purchasing decisions and signing off budgets.
Key Market Issues
Purchasing technologies from national resellers is the least preferred approach for financial market institutions as they are not easily accessible to provide value-added services and timely after-sales support.
Financial market institutions are keen to improve their operational efficiencies by streamlining their core business processes. This is fairly evident from the survey, as institutions give the objective of raising efficiency the highest average rating of X on a scale of 1 to 4.
As financial market institutions are undergoing a radical shift owing to new trends in technology such as online and mobile trading, it is becoming imperative for IT managers to demonstrate the value of IT to the business in order to gain sign-off for their investments.
As institutions are trying to improve their bottom lines by reducing costs amidst uncertain economic conditions, they are placing more emphasis on vendors who are able to provide them with flexible pricing models and value for money offerings.
According to Kable's survey, 72% of financial market institutions state that their ICT infrastructure is either very complex or somewhat complex.
Institutions are prioritising the business objective of cutting costs, giving this objective an average rating of X on the scale of 1 to 4. Financial market institutions are focusing on minimising costs to improve their profitability amidst uncertain economic conditions.
Institutions are assigning the second highest ratings of X to leading-edge technology as a selection factor, which signifies that ICT vendors who are able to provide disruptive technologies are likely to be preferred over their competitors.
The survey shows that financial market institutions are assigning considerable importance to the IT objective relating to 'meet internal service level agreements', with second highest average rating of X on a scale of 1 to 4.
On average, X% of respondents are inclined to buy technologies direct from suppliers, 35% from local resellers, and the remaining 20% from national resellers.
Financial market institutions rate CIOs/the IT department as the most influential authority when making ICT purchasing decisions, giving this group the highest average rating of X on a scale of 1 to 4. However, it is notable that CFOs/Finance Directors and the CEO also have significant influence with regards to ICT purchasing decisions, with average ratings of X on the same scale.
1 Enterprise ICT investment trends
1.2 Survey demographics
1.3 ICT budget changes
1.4 ICT investment priorities
2 ICT procurement trends
2.2 Purchasing channels
2.3 Business objectives influencing IT investment strategy
2.4 IT objectives influencing IT investment strategy
2.5 ICT provider selection
2.7 ICT infrastructure environment complexity
3.1 Financial market institutions are keen to deploy their technologies on-site as they have to adhere to strict compliance regulations
4.2 Further reading
4.3 Contact the authors
List of Tables
Table 1: Financial markets - enterprise ICT survey geographic breakdown
List of Figures
Figure 1: Financial markets - enterprise ICT survey geographic breakdown