In recent years, software has predominantly been made available as a service on the “cloud”. Unfortunately, the cloud infrastructure to date has been “horizontal” or not reflective of the unique infrastructure requirements of a specific industry. We are at an inflection point, however, where this is changing and vertical clouds are being made available. As a result you should be asking yourself, do you choose a “horizontal” cloud that is built for a wide variety of industries or a “vertical” cloud that is designed for your specific industry?
Particularly for wealth management firms, working with a vertical cloud provider that truly understands and is built for financial services is critically important. At NexJ, our software solutions are offered through the IBM Cloud for Financial Services. Because the IBM cloud offering is specifically designed to mitigate risk and has security and controls built into the platform, it enables financial institutions to automate their security and compliance posture, making it easier to simplify risk management and demonstrate regulatory compliance.
As Forrester Research states in its “The Rise of Industry Cloud Solutions” report, “Horizontal business applications — as mature as they are — don’t fully support industry-specific workflows that span the front and back office.”
In its report, “Wealth Managers: Run, Don’t Walk, to the Cloud,” Celent also emphasizes the importance of industry-specific cloud solutions for wealth managers: “To compete, they
must leverage cloud capabilities that leverage a more flexible, agile ecosystem for deploying new and innovative solutions … the business case is clear, and wealth managers will continue to feel the pressure not only from incumbent competitors but fintech challengers and rapidly changing consumer digital preferences accelerated by Covid-19. Over the next two years, wealth managers are projecting to have 85% of workload moved to the cloud.”
Clearly, a sea change is underway when it comes to utilizing the cloud in wealth management. Below are just some of the reasons why working with a “vertical” cloud provider is so important in financial services:
- Support for regulatory requirements and changes
- Hardening of security and data protections
- Tighter integration and support with existing solution providers and ecosystem providers
- Flexibility and speed to deploy new solutions
- Ability to attract financial advisors with more modernized tech, seamless infrastructure, and open architecture
- Adaptable and extensible, allowing organizations to only access what they need today and adapt as they grow.
- Continuous innovation allows firms to digitize processes that span silos of data.
- Better customer outcomes through deeper vendor-partner alignment. Industry solutions demand close coordination with partners, which helps to ensure that partners don’t duplicate roadmap features.
Learn more about NexJ’s software solutions available through IBM’s Cloud for Financial Services.