A plethora of new technology and software opportunities exist if you can see through the Brexit fogOctober 30, 2018
A plethora of new technology and software opportunities exist if you can see through the Brexit fog
How are you coping under the daily deluge of Brexit headlines? ‘Brextra time..!’, ‘ No deal Brexit could lead to £36bn bill’ or ‘Great Britain or Great Betrayal?’. Whilst it may be bonanza time for economic and political journalists, for many of us the fog is growing thicker and thicker. Whatever the outcome, one thing we know is that major UK and European business structural changes will follow and of all the sectors planning for the post-Brexit world, the technology sector is one of the most optimistic. Why? Because there will be an abundance of opportunities for technology and software consultancies and builders to assist business to move on, especially in the financial services arena.
Brexit opportunities lie across many technology domains
- Simplifying banking and investment systems. Both front and back office will have to change. It’s likely there will be greater technical and operational complexity post-Brexit. Those players that take a short-term tactical approach to adjust their systems will lose out to those taking a more strategic approach by seizing the opportunity to simplify their systems and standardize frameworks. Turning a potential problem into a strategic advantage could be the philosophy for many FS organisations, especially if current systems are somewhat fragmented.
- Boosting regulatory and compliance systems. This will simply accelerate already ballooning investment and attention with regtech (regulatory technologies). So nothing new here really. Compliance and regulatory demands will grow tougher whatever the Brexit outcome. A Boston Consulting Group report reveals the number of global regulations international banks have to comply with has more than tripled in the last four years. So banks must restructure so they can continue to serve EU customers and without spending a huge fortune doing so.
- More efficient financial services payment systems. Moving out of the EU, the role of the Single Euro Payments Area (SEPA) won’t apply any longer, potentially increasing the overheads of banks’ B2B customers who pay and collect funds to or from Europe. As a result, banks and equivalent organisations need to come up with more efficient and smooth running payment gateways for these clients both in Europe and for countries beyond Europe.
- Upskilling and training of technical staff. It’s not only systems that need to be agile post-Brexit but since software implementation and data strategies need to be agile in order to adapt quickly and cost-effectively, associated technical resource also needs to be agile and ready to adapt. Can internal technical resource adapt fast enough? Will it be possible to recruit new resource when there are already growing constraints on IT recruitment?
- New investment in data centres. The inevitable growing complexity in best principles for data transmission, security, retention and usage both in and beyond Europe will undoubtedly increase investment in data centres and shared services. Furthermore, if firms can’t access clearing services after Brexit, it may prompt earlier trials of distributed ledger technologies like blockchain.
So the UK, with its vast range of financial service operators, will continue as a leading location to do tech business. It also has a strong track record in the technology and innovation sector with tax incentives, investment and funding, R&D and other key drivers embedded in the economy. Greater disruption, though, is undoubtedly coming down the road for technology providers which they see, like changing compliance and data regulations, as the norm of business life rather than the exception: “Technology companies are used to facing disruption and are arguably more agile than most and less affected by new barriers to physical trade, so it may come as no surprise that they feel more positive than other industries about their Brexit preparedness. Companies in the sector also tend to have more of a global view as they strive for rapid growth.” said Jass Sarai, UK technology industry leader at PwC.
Attitude will count
Whilst the Brexit fog is growing thicker, there are many expected opportunities for technology firms on the way. But in business, as in life, the attitude taken by CEOs in technology and software firms will really count too. Success won’t come about simply by waiting and watching for Brexit outcomes. Don’t just rely on your foghorn! Success will come about by creating plans of attack which combine R&D investment in new solutions on the one hand with modern sales and marketing techniques to win new customers both in and out of Europe on the other.
- Agile (3)
- App (1)
- Banking (4)
- Capital Markets (4)
- compliance (1)
- Consulting (2)
- Digital (2)
- Finance (3)
- HTML (2)
- Security (1)
- UX (1)