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Why Workload Automation and Orchestration Make Sense for Financial Institutions… Even If You Outsource

As unemployment rates continue to plummet, thoughts of outsourcing are becoming more and more popular. But make sure your strategy is bullet proof.

Todd Weiss
Todd Weiss
VP of Product
Read Time
7 mins
Last updated
Nov 19th, 2021

In financial services, the sense of urgency around digital transformation has accelerated during the time of COVID. According to Gartner:

“76% of CIOs report increased demand for new digital products or services during the pandemic, and 83% expect this demand to increase further in 2021.”

What does this mean for the future of financial services operations?

For one, the increasing demand for everything digital is compelling more institutions to move away from managing their infrastructure in-house to an outsourcing model, which often includes the use of cloud services. By 2024, Gartner forecasts, more than 45% of IT spending on system infrastructure, infrastructure software, application software and business process outsourcing will shift from traditional solutions, including on-premises servers, to the cloud. (ii)

Interestingly, this rapid growth in outsourcing has been matched by an expansion of the workload automation market, specifically solutions that are capable of automating a wide range of operational processes both within and outside the core. Grand View Research forecasts the U.S. workload scheduling and automation market will sustain a robust 6.5% compound annual growth rate through 2027. iii

How can this be? Doesn’t third-party outsourcing eliminate the need for workload automation?

Not at all! Outsourcing and workload automation are the 1 – 2 punch that can drive efficiency, cost control and competitiveness in the digital age.

Outsourcing and Automation are Not Mutually Exclusive

Outsourcing an institution’s core processing and other key workload processes can generate numerous benefits, including increased efficiency, lower costs, improved business continuity planning and better deployment of existing staff and skillsets to focus on long-term, strategic development initiatives.

However, as their operational infrastructure grows more complex, many financial institutions are finding it increasingly difficult to integrate across multiple function-specific software platforms, including those housed on-prem and outsourced to third party providers. This can result in reduced access to siloed data, less control of recurring daily processes, and limited visibility into integrated systems and solutions.

If processes are not properly documented, outsourcing may also lead to the loss of years of accumulated institutional knowledge. Financial institutions must be careful not to outsource strategy and decision-making along with their repeatable processes, or else risk losing competitive advantage, agility, and the ability to scale effectively.

Why Automation Is Key... Even if Outsource Your Core

Outsourcing can also increase operational, regulatory, and reputational risks if proper vetting of a potential partner during the vendor assessment and analysis stage is not performed. It is important to establish robust service level agreements (SLAs) and ensure the provider has effective downtime and business interruption procedures in place. According to Deloitte, “without identifying critical risks and properly monitoring, the likelihood of such risks becoming material greatly increase.”iv

This is why more organizations are choosing to implement workload automation to maintain visibility and control, even while outsourcing more of their operations. According to a 2018 industry survey, “around 64% of the respondents identified IT workload operations as the most automated function in the industry.”

Leading workload automation solutions can connect multiple, diverse environments, whether in the cloud or on-prem, serving as both a system-wide orchestration platform and a porthole into the entire interconnected ecosystem.

6 Reasons Why Workload Automation Makes Sense

Whether you handle most or all your operations in-house, or through strategic partnerships with outsourced core processing or managed services providers, the employment of a modern, integrated workload automation solution can improve efficiency, boost productivity and reduce costs for financial institutions. Here’s why it makes sense:

  1. Improve visibility: Advanced Enterprise Workload Automation solutions offer financial institutions the benefit of “a single pane of glass” – allowing institutions to maintain clarity of vision over the entire operation, including those solutions that are on-prem and in the cloud.
  2. Maintain control: Workload automation solutions also allow an institution to keep control over outsourced processes, by enabling it to effectively monitor for accuracy and timeliness per contracted SLAs. This is important – as the inability to assess the effectiveness of outsourced processes is regularly named as a top worry of in-house IT professionals.
  3. Save time by automating repetitive jobs: Workload automation is proven to shave significant time off of recurring processes. One client using an industry-leading workload automation solution saved over 1,000 staff hours per year, simply by automating nightly processing. This savings allows valuable team members to be redeployed to other, more productive tasks and higher level initiatives within the organization.
  4. Save money by reducing errors: One of the leading causes of inaccuracies and mistakes is the manual entry of repetitive data, day after day. By automating these data entry processes, such errors can be substantially reduced or eliminated. For instance, clients of one leading workload automation solution have reduced manual errors by more than 90%, on average, through automation of time-intensive manual processes.
  5. You’re still doing a lot in house! Even if you outsource your core processing and business functions like ACH and check clearing, you most likely still run in-house operations for key functions like mortgage banking, business intelligence, commercial lending, finance and accounting, and HR.

    This all adds up to a multitude of opportunities to eliminate manual effort and gain efficiencies through workload automation, no matter where the software is housed
  6. Retain institutional knowledge: By embedding expertise into a workload automation solution, businesses retain knowledge and experience which is hard to document any other way. Institutions realize significant reductions in the costs of onboarding and training new and existing employees. In addition, automated workflows provide a simple visual guide to business processes as a complement to automatic process documentation.

What to Look for in a Workload Automation Partner

Of course, not all workload automation solutions are created equal. There is a big difference between old-school, simple job scheduling programs, and modern process automation solutions that are designed to increase efficiency and boost overall productivity. Here are a few key criteria to consider as you assess a potential workload automation partner:

  • The industry is moving toward widespread adoption of Enterprise Workload Automation models that facilitate the smooth and efficient orchestration and integration of multiple IT platforms, both external and in-house. This approach has many advantages over older methods of workload automation, including the ability to run across multiple platforms within the IT infrastructure and the cloud. Gartner projects that through 2024, 80% of organizations using legacy or outdated workload automation tools will switch to such robust, orchestrated  
  • Let’s face it—financial services is different. But some workload automation firms try to be all things to all industries. Before you put your trust in a workload automation partner, you want to ensure they have comprehensive domain expertise in financial services operations and technology. That’s why you should seek out a workload automation solution that was designed specifically for financial institutions.
  • If you’re just getting started in your workload automation journey, it’s best to select a system that can grow with you over time. Look for a solution that is flexible enough to support your evolving automation ecosystem and enables you to add new environments, replicate workflows across systems, and integrate new business processes—quickly and easily. The ideal solution is one proven to handle ecosystems ranging from a single-server setup with hundreds of thousands of workflows per day, to a multi-server configuration that processes millions of workflows daily.
  • Leading workload automation platforms often include the ability to have workflows or business processes automatically triggered by events such as emails, user actions, environmental sensors, and system messages. Virtually any action can be considered an event whether it comes from a voice activated source, the Internet of Things (IoT), wearable devices, mobile, or the cloud. These events can control cloud migrations, customer interactions, front-office activities, back-office processes or even infrastructure tasks. DevOps and disaster recovery are both examples of where cumbersome processes need to be more accessible and more agile –event-driven automation is the technology that bridges that gap.
  • Business continuity planning and disaster recovery are critical functions that can mean the difference between an extended business interruption and getting back to serving your members quickly. Automation is an important component that enables the error-free deployment of key aspects of the disaster planning and recovery process, including regular testing, reliability, redundancy, and execution. Look for a workload automation solution with powerful features to calculate and perpetually maintain end-of-month, next business day, and other more complex scenarios.

The rapid growth of digital services is causing financial institution infrastructure to become increasingly complex, making the jobs of internal IT professionals that much harder. Workload automation can help simplify processes across multiple, diverse environments, and provide exceptional visibility into the entire interconnected ecosystem. Whether you continue to manage in-house servers and systems, outsource your core processes, or both, workload automation is the right solution to streamline operations, improve efficiency, and minimize errors for your financial institution.

OpCon simplifies the execution of core financial institution operations, ensuring your organization avoids costly manual errors and never misses a posting. To learn more about OpCon from SMA Technologies, contact us at [email protected].

In this article

As outsourcing becomes more and more prevalent, organizations continue to look for ways to get the most out of their outsourcing strategy. Read more to learn how automation can take your organization to the next level.