Sectors across industries face constant change, but none more so than financial services. Technology evolves, customer demands change, and regulators continue enhancing scrutiny to protect consumers and global markets. We’re not just dealing with incremental change—we’re navigating a fundamental reshaping of financial services.
What’s emerged is a growing fragmented technology landscape that is difficult to control and manage. The result? A complex ecosystem that makes adapting to change a monumental task that only increases over time.
Take recent regulations, such as open banking mandates, AI risk controls, and the T+1 settlement update. Each represents a significant challenge and cost. According to a report from analyst firm Celent, financial institutions will spend US$155.3 billion on compliance operations in 2024.
Right now, many firms are playing defense. They’re solving today’s problems without building the infrastructure for tomorrow’s opportunities. But these actions are also signals of a deeper truth—the market demands adaptive, forward-thinking technology strategies.
Transformation projects not-so-hidden challenges
Organizations face a perfect storm of obstacles that simultaneously push for change—and, at times, block project success.
Process inefficiency
A patchwork of systems, manual or semiautomated workflows, and email chains create compliance bottlenecks. These friction points don’t just slow teams down—they drain employees. These disjointed technologies and processes are difficult to modernize and optimize.
Coordination and process complexity
Global teams, varying time zones, and fragmented processes create significant operational risks. Most organizations need help maintaining a clear end-to-end view of their workflows; critical gaps in ownership can make it difficult to determine when and how to update risk or decision-making criteria.
Rigid platforms and technology limitations
Outdated and monolithic systems trap organizations in a cycle of inefficiency. Quick technological fixes using point solutions or commercial off-the-shelf tools quickly become roadblocks as they’re difficult to customize to the organization and can’t keep up with business demands. This often forces teams back to manual processes or other workarounds, preventing true digital transformation.
Data fragmentation
Inconsistent data across systems and regions keeps this valuable resource from turning into insights and opportunities. Companies can’t effectively improve risk strategies or develop sophisticated machine-learning models without standardized, clean data.
Forces driving change
Financial institutions face converging pressures that demand a fresh approach to transformation.
Internal forces
As transaction volumes surge due to increased digitization and customer demands, organizations must improve cost-to-serve ratios without exponentially increasing overhead. Yet fragmented efforts create localized “islands of automation” that resist change and block innovation.
External forces
New regulations like T+1 and Basel III Endgame aren’t just compliance costs—they’re catalysts for reinventing processes. Meanwhile, AI/ML adoption and cloud migration are setting new standards for operational excellence and may soon be threatened by AI governance regulations. Without an adaptable foundation, these regulatory shifts can be expensive to comply with instead of an opportunity.
Business drivers
Success demands an agile, composable architecture that fits business demands and technology disruptions rather than breaking under pressure. This foundation helps organizations modernize legacy systems while maintaining the adaptability to seize emerging opportunities and fund innovation through operational savings, mitigating risk, and improved alignment.
The process orchestration and automation advantage
Adapting to change requires a flexible, open, and resilient foundation. Without these fundamentals, organizations struggle to handle even minor changes, let alone massive regulatory shifts such as trade settlement rulings or open banking initiatives.
To succeed, organizations must be able to accomplish three critical capabilities:
- Tame complex processes
- Align teams with one-model approach
- Overcome legacy limitations
Tame complex processes
The nature of an organization’s technology landscape is inherently intricate and interconnected. Every critical workflow spans multiple systems, teams, and technologies. Most require advanced workflow patterns to handle the business logic hidden in layers of code, making changes risky and slow.
Using open standards such as BPMN (business process model notation) controls complexity, letting you integrate technologies and simplify workflows.
Align teams with one-model approach
Open standards like BPMN and DMN turn abstract strategies into executable models. When business and tech teams share the same visual language, what you design is what runs in production—eliminating costly misalignments. As the model is essentially executable code, what you design together is what runs in production, reducing cycle times and potential misunderstandings.
Overcome legacy limitations
Core systems generate revenue, and you can’t just switch them off. Process orchestration lets you gradually decompose monoliths without interrupting the rhythm of business. This controlled modernization protects critical operations while reducing risk and freeing up resources for innovation projects.
Open architecture and the ability to tame complexity are central reasons why firms are looking to process orchestration to decommission legacy while embracing new technology. The right platform allows a monolith to be broken down into individual services (in the case of microservices architecture) and switched off as new systems come online, helping to derisk the transformation.
Real solutions: T+1 transformation at a global bank
A large global bank serving over 48 million customers faced a complex challenge: modernize post-trade processing for T+1 compliance while managing diverse financial products across multiple regions.
“The complexity is quite high in trade operations, [and is] multiplied due to multiple financial products and multiple regions, each with their own regulations and SLAs,” noted the bank’s head of strategic settlement services. Their legacy systems and vendor patchwork couldn’t keep pace with market demands. “To reduce costs, we outsourced different parts to vendors. We ended up with a patchwork of vendor platforms. In order to scale, we needed to decompose the systems and run them more independently.”
Using Camunda’s process orchestration platform, the bank:
- Modernized legacy systems without business disruption
- Achieved T+1 compliance in under six months (including sales agreement and infosec)
- Built a resilient, scalable, cloud-native platform
- Sped up time to market for new products or regulatory compliance
“There’s increased regulatory scrutiny to have accurate data and control,” according to the bank’s managing director of markets post trade technology. “That’s where BPMN comes in because it’s a transparent process that helps mitigate the potential of fines. We can demonstrate the process to regulators and business owners.”
Four key takeaways to drive success
The key takeaways for banking and capital markets firms looking to harness the power of regulatory technology are clear.
Align project strategy with company goals
Unify your technology strategy with your company’s broader objectives. Regulatory excellence isn’t just about compliance but driving a sustainable, long-term competitive advantage.
Bring teams together to solve a common problem
Diverse teams create more robust solutions. However, getting everyone on the same page when designing processes is essential for strategy and execution to flow seamlessly and mitigate the risk of rework. A shared model and language are essential for delivering innovation at speed and scale.
Engage expert partners to speed up success
Lean on a team of third-party experts to gain a wide and deep view of challenges (and potential solutions). Firms benefit from their collective knowledge, having worked on similar challenges with clients from various industries.
Choose technology that supports agility
Scaling the wrong platform multiplies problems. Look for a process orchestration and automation solution that’s open by design, flexible enough to integrate any technology, and composable to maximize resources so you can build once and reuse many times.
Conclusion
If you want to learn more, watch the webinar recording to hear the complete story of how organizations use technology to stay ahead of change. Want to read more in depth?
Start the discussion at forum.camunda.io