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December 5, 2019
Operational Resilience is about more than just regulatory compliance. It’s a business imperative to build and maintain trust and reliability. Regulators are increasingly demanding more of financial services firms when it comes to ensuring operational resilience. Firms need to be able to both minimize the likelihood of incidents occurring and causing disruptions while also understanding that disruptions will happen and having robust response and recovery processes in place.
Due to increasing consumer expectations and competition, financial services firms are under a lot of pressure to be agile and innovative. Investing heavily in new technologies to meet these demands and retire old technologies and infrastructure is necessary for doing this, but increased change means increased risk, both in terms of technological change and the way the business operates.
According to the FCA, change management is the number one root cause of outages. This means that despite external cyber threats being the focus of many resilience efforts, most outages come from internal problems with change. IT obsolescence is also a major concern for bank risk functions, and dealing with this risk of obsolescence is likely to lead to more change, creating more outages, if change cannot be managed with resilience.
So how can firms increase their pace of change while staying resilient? Last year, the FCA and the Bank of England jointly released a discussion paper that urged firms to rely less on technology and more on human accountability: “Common regulatory themes apply across regulated entities including individual and collective accountability for matters that support operational resilience.”
Therefore increasing accountability and using technology as a way to empower people, not just relying on technology alone, is the best way forward. Because change is the most prevalent cause of disruption, and firms need to do more and more of it, they can’t afford to continue with existing risky methods of change.
Resilience must be embedded into the process of change and transformation from the start. This not only means rigorously designing, building and testing new solutions, but also improving the way in which they’re deployed. This is a complex mix of human and machine tasks with a lot of risk that requires the right level of orchestration and observability to be successful and resilient.
With so much complexity and risk involved in change and transformation, firms need a new way to ensure they can move quickly without breaking things. Read the Cutover Big Change, Continuous Transformation and Resiliency, Response & Recovery use cases to find out how a Work Orchestration & Observability platform could be the answer.