FIS’s BPaaS strategy: Delivering a competitive edge

Simon Roche and Neil Mardon from FIS discuss the firm’s business process as-a-service (BPaaS) strategy, how FIS stands out in the highly competitive “as-a-service market” and how it delivers business, technology and operational benefits to capital markets businesses.

What do you see as the key business and operational benefits offered by FIS’s BPaaS compared with the traditional lift-out or pure-play business process outsourcing (BPO) model?

Simon Roche, senior vice-president, division executive, head of Capital Markets Business Process Services, FIS: We lead with an intellectual property (IP) and technology-first approach, and then BPaaS follows as a targeted and scalable solution. So, we get the benefits of a pure-play BPO offering—effectively a reduction in the total cost to serve and head count off the balance sheet—but with additional benefits.

Number one is that we can directly influence the strategic product road map in close alignment with our solutions development teams, as we have teams that are experts in the technology, products and markets we’re serving.

Second, we can deploy automation and continuous improvements where those teams identify efficiency opportunities. Third, we de-risk our clients from the burden of regulatory change, as we manage both the system and the underlying processes that are subject to those regulations.

The software-as-a-service (SaaS) model opens up opportunities, and that’s a key trend we’re following closely in the industry. The SaaS model also allows us to scale benefits across all of our clients, because we’re leveraging the same technology in the same operations team. So, we improve both the process and the technology that feeds into the operational service that clients receive.

Neil Mardon, securities business process services, FIS: There are definitely mutualized benefits to be gained with the BPaaS model. The traditional BPO model looks specifically at clients’ needs. With BPaaS, we’re looking across our client base and mutualizing those benefits for all our clients.

How does FIS’s BPaaS offering differentiate itself from similar offerings on the market? This is an intensely competitive marketplace right now, so what are the various ingredients that feed into FIS’s secret sauce?

Neil Mardon: We have four core components and Simon touched on the first—it’s IP-led. Controlling the technology is critical for us. It means we’re not reliant on legacy tech, we’re not reliant on clients’ technology and we control the tech stack. Controlling the tech stack allows us to deal with efficiencies in an automated, systemic way and mutualize those efficiencies across our client base. Using the SaaS model means everyone benefits from improvements to the system via monthly upgrades, and we’re optimizing those benefits across our entire ecosystem.

The second component is scalability. We try and ensure that our product meets our clients’ demands based on their size and needs. So, whether we have small or large clients, they’re all benefiting equally from the mutualized system development.

Hosting is another key component of our offering. We remove the challenges of dealing with on-premises delivery and clients’ infrastructure, taking the burden away from the client technology teams. We manage all of the infrastructure for our clients as a cohesive, integrated service offering.

Finally, we have an integrated service offering where the professional services, client support, the development team and hosting are in a single integrated service. We think that’s an efficient portfolio of services that help our clients unlock the benefits of keeping technology up to date, the cost benefits that come with that, and mutualizing those benefits and standardizing across the industry.

How was FIS able to establish a successful service model with its various clients, and how do you balance that offering with clients’ specific expectations?

Simon Roche: Our service model is predicated on providing an integrated service offering to our clients. Our BPaaS teams work hand-in-hand with our client experience, managed service, professional services and development teams to ensure we offer the full breadth of FIS services to all clients. In the past 12 months, this integration has been moving even further through the organisation, because we’ve implemented agile value streams. We’ve built cross-functional teams delivering on a common set of OKRs—objectives and key results—to our clients, and we think that adds to the value we provide.

We’re also very focused on net promoter and customer satisfaction scores and are always looking at how we can implement artificial intelligence to assist our teams in that customer experience layer to answer queries as quickly as possible. The final thing is that all of our service-level agreements focus on outcomes—we’re judged by our clients on the outcomes we deliver, not the inputs that go into the processes.

Are you seeing any current trends across the financial services industry with regard to the specific business processes firms are looking to take on or consume as a managed service, or is pretty much everything up for grabs? If that’s not the case, which processes do firms want to retain control over and not take on as a service?

Neil Mardon: Traditionally, people have wanted to keep all of their processes and functions in-house, but that’s definitely changing. All of our clients are facing the same challenges: cost pressures and margin compression, which are coming from a host of issues, such as a competitive landscape and regulatory mandates. These issues are expensive to address and common to our client base, so we’re seeing clients open to outsourcing any function that’s not a unique selling point (USP) for them and is going to help reduce cost and improve efficiency. For a bank or capital markets firm, anything that’s not part of their USP is up for grabs.

We can offer a service that deals with the utility part of their processing, which isn’t core to their functional offering to their clients. Every client we talk to is open to a conversation on how we can help them address their cost and functional challenges. They want to hear about what we have to offer—from the technology through to the specific business processes. While costs and efficiency are typically the key drivers, they’re also looking for ways to improve their client offerings and enhance their USP.

And there’s the issue of time-to-market, which is critical to firms on both sides of the industry. They don’t want to spend 12 or 18 months undergoing complex in-house implementations—they want to be up and running with a minimum of fuss and be using the service almost immediately, right?

Simon Roche: Yes, I fully agree. We have a group of people who are experts in products, technology and services. So it’s not a case of having to retrain staff on a new platform—we already have staff who are experts in our platform, which allows us to onboard new clients at speed.

One of our key metrics is time-to-market; we’re focused on minimizing this, because clients just want to get going once they’ve signed the documentation. They want to get the technology in place and the business processes transitioned as quickly as possible. Typically, with BPO providers, that can be a six and even a nine-month equation. With BPaaS, because we already have the expertise in the organization, we can leverage existing resources and get implementations going very quickly. And, ultimately, BPaaS helps our clients put their capital to work.

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