Beyond boundaries: adapting fintech strategies in finance
05 September 2023
Nick Delikaris, head of Automation, Analytics and Platform Services at State Street, discusses the mechanics of leveraging strategic tools commonly found in fintech companies into core financing products
Image: stock.adobe/Quinn
Fintech companies have shown the potential that exists when a product-driven culture is coupled with agile, cutting-edge technology platforms. In the modern, interconnected business landscape, firms emphasising seamless interactions between clients, employees and strategic partners are able to stand out by offering digital platforms that operate as a gateway to the company and its product offerings.
While these platforms have long been a staple of the technology sector, financial firms are quickly aligning with this ideology as they recognise the value of offering platform-centric distribution channels to enhance the customer experience.
The success of products in the digital platform space is closely linked to the implementation of robust cross-functional teams to help manage their direction, production and distribution. The strategy and evolution of a platform-focused approach requires commitment and expertise from a wide array of teams, and the creation of a cross-functional group to help oversee this process facilitates their rapid development and improvement.
This has been proven by some of the largest technology and fintech firms in the world, as teams with an acute awareness of product composition, design and delivery can more quickly cut across silos and achieve desired outcomes.
Integrating multiple products into a unified offering
The evolution of financing solutions at State Street provides a tangible example of how this strategy is transforming the finance sector. After a strategic review of our product suite and customer base, we merged securities finance and secured funding to create a more seamless engagement model for clients who consistently seek solutions that one or more of our franchise businesses can offer. This transformation subsequently led to a reimagination of our product-service interplay, with adjustments tailored to deliver on our strategic objectives.
Evolving strategy with technology and multifaceted teams
As State Street’s financing products became increasingly infused with technology-based solutions such as electronic distribution, decision-making algorithms and advanced analytics, it became imperative to focus a single team on data, quantitative modelling and technology.
To achieve this, the Automation, Analytics and Platform Services (AAPS) group was created to address technical and automation challenges quickly, along with prioritising strategic solutions, which require collaboration across the entire organisation.
Challenges like balance sheet optimisation, regulatory changes like T+1 implementation and platform resiliency planning are central to all financing products and require proficiency across the business and technology spectrum. The team is able to succeed in such cases by quickly identifying product-specific challenges, deploying tactical solutions and then extending these successful methodologies to other domains. These data points and workflows establish a robust foundation for strategic decision-making, enabling AAPS to enhance operational efficiencies and formulate long-term solutions.
Another critical responsibility of the AAPS team involves managing strategic technical relationships. We take pride in partnering with a wide range of fintech providers, allowing us to offer to clients a range of solutions via a single trusted provider. This level of collaboration extends to teams within State Street as well, where we work on technologies such as artificial intelligence, blockchain and tokenisation.
In the current state of the technology cycle, it is impossible for a single team to have the expertise in all of these disciplines. These partnerships not only speed up our time to market, but also ensure we work in concert with broader firm initiatives including State Street Alpha and Charles River Development, State Street Associates and State Street Digital. This dynamic enables more sophisticated and holistic products, all while leveraging our core strategy of creating an integrated platform for customer-facing interaction.
One of the most difficult aspects of the business is how to best prioritise and budget technology spending. Making informed decisions on these matters would be impossible without a team that has a view into each of our financing businesses and their partners within the larger organisation. The ability to look at the bigger picture and stay attuned to firm-wide initiatives creates a critical feedback loop that facilitates optimal roadmap planning and implementation. This mechanism is instrumental in shaping and communicating our core technology strategy.
Finally, the team is responsible for managing State Street’s core client-facing platform, Venturi. Spanning pre-trade, execution and post-trade workflows, Venturi provides a one-stop solution on an interactive platform designed to enhance the complete client experience. Its inherent flexibility allows clients to harness its capabilities at any stage of their operational journey. Venturi extends seamlessly across multiple products and workflows, ensuring a cohesive user experience while promoting operational efficiency for us and our clients through the offer of valuable product combinations. This allows us to further strengthen our relationships with clients by providing them with insights and quantitative tools to support decision making through real-time data and state-of-the-art technology.
Solutions fall into place
The incorporation of digital platforms and cross-product groups into financing has not been straightforward from an execution standpoint, considering how fundamental the shift has been. Initially, forming a multi-dimensional technical team and extending it across the product suite was often an overwhelming task. However, after that initial period, we have witnessed a surge in engagement, as the team finds value in the increased accessibility and transparency across the entirety of the business.
This expanded access has provided them with additional avenues to actively contribute to the organisation's overarching goals which, in turn, enhances their overall sense of participation and satisfaction. Ultimately, this leads to enthusiasm and creativity, as they have the ability to think about solutions through a different lens.
The feedback we have received from clients regarding Venturi reaffirms our strategy. Clients are seeking holistic and simple solutions. Clearly, they want to be part of this journey as it parallels their own needs. While we enjoy the challenge and opportunity that comes with building a world-class platform, we also benefit from the ability to forge closer and unique relationships with our clients.
It has become apparent that the creation of cross-product teams combined with our new platform strategy has helped to evolve our business. We look forward to the continued expansion of the Venturi product and the opportunity to help our clients accomplish their goals through creative, efficient solutions.
While these platforms have long been a staple of the technology sector, financial firms are quickly aligning with this ideology as they recognise the value of offering platform-centric distribution channels to enhance the customer experience.
The success of products in the digital platform space is closely linked to the implementation of robust cross-functional teams to help manage their direction, production and distribution. The strategy and evolution of a platform-focused approach requires commitment and expertise from a wide array of teams, and the creation of a cross-functional group to help oversee this process facilitates their rapid development and improvement.
This has been proven by some of the largest technology and fintech firms in the world, as teams with an acute awareness of product composition, design and delivery can more quickly cut across silos and achieve desired outcomes.
Integrating multiple products into a unified offering
The evolution of financing solutions at State Street provides a tangible example of how this strategy is transforming the finance sector. After a strategic review of our product suite and customer base, we merged securities finance and secured funding to create a more seamless engagement model for clients who consistently seek solutions that one or more of our franchise businesses can offer. This transformation subsequently led to a reimagination of our product-service interplay, with adjustments tailored to deliver on our strategic objectives.
Evolving strategy with technology and multifaceted teams
As State Street’s financing products became increasingly infused with technology-based solutions such as electronic distribution, decision-making algorithms and advanced analytics, it became imperative to focus a single team on data, quantitative modelling and technology.
To achieve this, the Automation, Analytics and Platform Services (AAPS) group was created to address technical and automation challenges quickly, along with prioritising strategic solutions, which require collaboration across the entire organisation.
Challenges like balance sheet optimisation, regulatory changes like T+1 implementation and platform resiliency planning are central to all financing products and require proficiency across the business and technology spectrum. The team is able to succeed in such cases by quickly identifying product-specific challenges, deploying tactical solutions and then extending these successful methodologies to other domains. These data points and workflows establish a robust foundation for strategic decision-making, enabling AAPS to enhance operational efficiencies and formulate long-term solutions.
Another critical responsibility of the AAPS team involves managing strategic technical relationships. We take pride in partnering with a wide range of fintech providers, allowing us to offer to clients a range of solutions via a single trusted provider. This level of collaboration extends to teams within State Street as well, where we work on technologies such as artificial intelligence, blockchain and tokenisation.
In the current state of the technology cycle, it is impossible for a single team to have the expertise in all of these disciplines. These partnerships not only speed up our time to market, but also ensure we work in concert with broader firm initiatives including State Street Alpha and Charles River Development, State Street Associates and State Street Digital. This dynamic enables more sophisticated and holistic products, all while leveraging our core strategy of creating an integrated platform for customer-facing interaction.
One of the most difficult aspects of the business is how to best prioritise and budget technology spending. Making informed decisions on these matters would be impossible without a team that has a view into each of our financing businesses and their partners within the larger organisation. The ability to look at the bigger picture and stay attuned to firm-wide initiatives creates a critical feedback loop that facilitates optimal roadmap planning and implementation. This mechanism is instrumental in shaping and communicating our core technology strategy.
Finally, the team is responsible for managing State Street’s core client-facing platform, Venturi. Spanning pre-trade, execution and post-trade workflows, Venturi provides a one-stop solution on an interactive platform designed to enhance the complete client experience. Its inherent flexibility allows clients to harness its capabilities at any stage of their operational journey. Venturi extends seamlessly across multiple products and workflows, ensuring a cohesive user experience while promoting operational efficiency for us and our clients through the offer of valuable product combinations. This allows us to further strengthen our relationships with clients by providing them with insights and quantitative tools to support decision making through real-time data and state-of-the-art technology.
Solutions fall into place
The incorporation of digital platforms and cross-product groups into financing has not been straightforward from an execution standpoint, considering how fundamental the shift has been. Initially, forming a multi-dimensional technical team and extending it across the product suite was often an overwhelming task. However, after that initial period, we have witnessed a surge in engagement, as the team finds value in the increased accessibility and transparency across the entirety of the business.
This expanded access has provided them with additional avenues to actively contribute to the organisation's overarching goals which, in turn, enhances their overall sense of participation and satisfaction. Ultimately, this leads to enthusiasm and creativity, as they have the ability to think about solutions through a different lens.
The feedback we have received from clients regarding Venturi reaffirms our strategy. Clients are seeking holistic and simple solutions. Clearly, they want to be part of this journey as it parallels their own needs. While we enjoy the challenge and opportunity that comes with building a world-class platform, we also benefit from the ability to forge closer and unique relationships with our clients.
It has become apparent that the creation of cross-product teams combined with our new platform strategy has helped to evolve our business. We look forward to the continued expansion of the Venturi product and the opportunity to help our clients accomplish their goals through creative, efficient solutions.
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