NEW YORK, Feb. 23, 2021 /PRNewswire/ -- Over half of
financial services firms worldwide plan to increase their spending
over the next two years on next-generation technologies such as AI,
blockchain, the Cloud and digital, according to a new study
surveying 1,000 global C-suite executives and their direct reports,
released today by Broadridge Financial Solutions (NYSE: BR), a
global Fintech leader.
Broadridge's Next-Gen Technology Adoption Survey indicated
that firms also reported a range of strategic benefits from prior
investments in emerging technologies, including accelerated time to
market, better decision-making and improved risk management.
Broadridge developed The ABCDs of Innovation Maturity Framework™
for the study to categorize firms as either a Beginner,
Implementer, Advancer or Leader in next-gen technology adoption.
Next-gen technology maturity was based on progress made in
implementing these technologies and reported effectiveness in
driving business performance.
ACCELERATING TRENDS
Over the next two years, firms worldwide reported plans to
increase the share of their overall IT budgets spent on next-gen
technologies from 11.8% to 15.7% on average, an increase of
33%.
"In a remote and evolving business environment, investments in
AI, blockchain, the Cloud and digital technologies will continue to
drive long-term growth and have already become essential to both
day-to-day operations and larger strategic shifts around
mutualization, resiliency and digital transformation," said
Chris Perry, President of
Broadridge. "Broadridge's inaugural study reveals that for
financial services firms, investments in next-generation
technologies directly lead to a range of strategic benefits, in
addition to increased revenues and profits and decreased costs. Put
simply, those who are investing in technology with a clear strategy
for accelerating adoption are getting the most value."
The study found Leaders, those firms with multiple next-gen
technology use cases, which are moving toward enterprise-wide
adoption and driving major performance gains and business
transformation, are spending a greater share of their overall
IT budget on emerging technologies versus Non-leaders. They also
report improved employee productivity, more effective risk
management and compliance, faster creation of new/enhanced products
and stronger reputations as a result of their investments.
The study reveals that while spend is increasing across the
board, firms that are Leaders in next-gen technology adoption plan
to increase this allocation to nearly 20% of their overall IT spend
by 2023. The study showed that sell-side firms are spending a
greater proportion of their IT budgets on next-gen technologies
than buy-side firms and will continue to do so over the next two
years.
THE CLOUD: UNDERPINNING FIRMS' STRATEGIC
TRANSFORMATION
Broadridge's Next-Gen Technology Adoption study finds that
organizations are most reliant upon Cloud technologies for
improving their business activities and capabilities, followed by
digital, AI and blockchain. According to the firms surveyed, the
Cloud is used most often within areas such as sales and trading
(68% and 54%, respectively), product development (68%), human
resources (67%), customer management (66%) and IT infrastructure
(65%), making it a beneficial tool for firms continuing to operate
in a remote environment.
The study also found that digital capabilities are used most
often within areas such as strategic planning (61%) and marketing
(51%), and AI capabilities are used most often for security (39%)
and portfolio and investment management (35%).
According to the study, firms plan to increase investments
across all of the next-gen technologies in the next two years with
60% saying they will increase spending on the Cloud, followed by AI
(56%), then digital (53%) and blockchain (53%).
DRIVING REVENUE
In terms of return on investment, those who were identified as
Leaders said they had achieved a 2.55% profit margin increase over
the prior year through the use of emerging technologies. This
compared with firms that were identified as Non-leaders, which
reported a smaller 1.25% profit margin increase. Leaders also
reported a 4.04% increase in revenue through the use of emerging
technologies, compared to a 1.74% increase in revenue for
Non-leaders, indicating that leading firms are more likely to
create new revenue streams through these technologies. Cost
reductions were relatively consistent among firms at an average of
-2.72%.
Leveraging next-gen technologies is part of Broadridge's
investment in The ABCDs of Innovation® – AI, blockchain, the Cloud
and digital – helping clients understand and apply these
technologies by simplifying the complex to help them be Ready for
Next. View the full Broadridge Next-Gen Technology Adoption survey
report.
METHODOLOGY
The Broadridge Next-Gen Technology Adoption Survey was conducted
by ESI ThoughtLab to assess how financial services companies are
adopting next-gen technology, where they are investing the most and
the returns they are generating. C-suite decision-makers and their
direct reports from 1,000 financial institutions were surveyed by
phone, with fielding from October – November
2020. The sample consisted of 85% C-level executives and 15%
direct reports. The survey was conducted with executives from
buy-side and sell-side firms, including insurance companies (17%),
asset managers (17%), broker-dealers (16%), wealth managers (16%),
private equity companies (10%), universal banks (10%), banks (8%)
and hedge funds (6%). Responses were split evenly among the APAC,
EMEA and North American regions. For further details on survey
methodology, please contact a Broadridge media representative.
ABOUT BROADRIDGE
Broadridge Financial Solutions, Inc. (NYSE: BR), a $4.5 billion global Fintech leader, is a leading
provider of investor communications and technology-driven solutions
to banks, broker-dealers, asset and wealth managers and corporate
issuers. Broadridge's infrastructure underpins proxy voting
services for over 50 percent of public companies and mutual funds
globally, and processes on average more than U.S. $10 trillion
in fixed income and equity securities trades per day. Broadridge is
part of the S&P 500® Index and employs over 12,000 associates
in 17 countries.
For more information about Broadridge, please visit
www.broadridge.com
MEDIA CONTACTS:
Matthew Luongo
Prosek Partners
+1 646.818.9279
mluongo@prosek.com
Linda Namias
Broadridge Financial Solutions
+1 631-254-77711
Linda.Namias@broadridge.com
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SOURCE Broadridge Financial Solutions, Inc.