I believe that over the next decade, survival for many buy- and sell-side firms hinges on making strategic bets in two main areas. These bets also form the basis of what it takes for these firms and the wider industry to thrive. Everything else is either a distraction or a function of those bets.

It starts with being really clear on what differentiates your firm; everything else is a waste of time and resources. Clarity around your firm’s reason for being and how (and where) you can realistically compete allows you to make the right decisions, not least on where to simplify the rest of your business. By being clear upfront on which parts of your business are central to the way you compete, enables you to decide which processes have to be kept in-house (and why), and which could or should be outsourced.

Open for business

Starting with the business model itself and working down to the technology, not the other way around, is crucial for defining a target state business and associated IT architecture. This target architecture should not merely identify applications that support the retained business processes. It should have an OpenAPI approach to integration between the business processes themselves, not just systems that underpin those processes.

A rigorous OpenAPI approach to both business and technology gives your firm a clear picture of not only what stays in-house, but also how those parts of your business interact with the outsourced items. This not only enables the procurement of third-party processes on an as-a-Service basis, but allows it to be carried out sustainably. Clear interfaces mean in-house and as-a-Service processes can evolve independently (but aligned) and be changed quickly and efficiently as business requirements ebb and flow. Given the importance of agility in the face of changes in business needs and the relentless convergence toward as-an-Industry solutions, this is critical.

It’s a battle for survival

The first focus for strategic bets is all about survival. It’s about being brave and clear-headed enough to decide what not to do and stick to it in spite of the inevitable naysayers. The second bet concerns the opposite point of view — deciding what to do — and is enabled by efficiencies generated by the first. It hinges on answers to two fundamental questions: “What will affect my clients and business most” and, “How do I equip my workforce to best serve those clients”.

Answers to these questions are much harder to divine, but essential if the second bet is going to pay off. Focus your full managerial attention on customer interaction and the technology that best augments your customer-facing business machine. Then allocate the majority of your investment funds toward equipping the machine at pace and scale with 21st century tooling and insights.

How can we help?

We’re proud to have earned universal recognition as the premier provider of software engineering teams and services for banking and capital markets. Through more than 200 engagements in the capital markets space alone, we have emerged as the trusted partner for large-scale, time-sensitive and highly complex projects.

Luxoft has evolved from a trusted provider of outsourcing and consulting services, to a trusted partner that clients can rely on when they need to modernize systems or deploy new and innovative technologies.

Practitioners at heart with an appetite for complexity, we work with leading specialist technology firms to offer an ecosystem of innovative solutions, technologies and talent that empowers our clients to lead the industry.

Luxoft’s core strengths are founded on three elements

1. Our people: We have deep capital markets domain expertise and strong engineering capabilities, plus an enviable track record for successful operational-efficiency programs and application-implementation projects. Luxoft helps clients design and implement the best approach for adopting innovative solutions that drive new business and increase profitability

2. Our unique approach to client projects: Over the years, we have become a byword for the successful delivery of large scale, complex projects for capital markets clients. This is a result of our ability to rapidly deploy engineering teams tailored for an optimal balance of experience and seniority at any given cost point

3. Our ecosystem of trusted partners: This collaborative environment embraces trading and risk, treasury management, middle and back office, client relationship management, and data and analytics, supported by unrivalled bespoke engineering and technology advisory and delivery teams. We’re the leading integrator of a wide range of proven and innovative capital markets applications, including offerings from market leaders like Murex, Calypso, Finastra and Fenergo

Delivering on mission-critical projects

Luxoft’s extensive experience in capital markets projects has given us a deep understanding of what makes financial institutions tick. This translates into knowledge of functional requirements and how to apply them across a wide range of market-oriented use cases. Also, it has enabled us to develop an acute awareness of the sensitivities of operating as a regulated entity.

Our appetite for complexity means that clients regularly turn to Luxoft for help with their most demanding technology projects and regulatory requirements. Luxoft specializes in highly complex mission-critical projects, whether that’s for a targeted application deployment or a wider digital transformation initiative. The design and make up of Luxoft’s delivery teams give them the ability to flex and scale in alignment with client needs over the lifecycle of the engagement, ensuring resources are closely mapped to need throughout.

The perfect fit

These attributes, combined with the strength and diversity of solution offerings from our strategic partners, make Luxoft the first port of call on your journey toward an agile, flexible operating model. We ensure your new model will be fit enough to both survive and thrive in the face of radical changes in the capital markets industry across the coming years.

In case you missed part three of this blog series, you can read it here. If you’d like to find out how Luxoft can help you find answers for these burning questions, visit LinkedIn. Alternatively, if you’d prefer to talk overcoming capital markets challenges with one of our experts, contact financialservices@luxoft.com.

Matthew Hargreaves
Global Industry Lead, Capital Markets Solutions, Luxoft
Matthew has more than 20 years’ combined expertise and international leadership experience as a CIO and COO in the Financial and Capital Markets industry. His career spans Credit Suisse, Deutsche Bank, Credit Agricole, Daiwa Capital Markets and Lloyds Banking Group. He joined Luxoft in March 2020 to lead Capital Markets Solutions globally.