FIs weighing the automation of any processes must decide whether to create the new technology in-house or acquire it.

But a mix of the two options may be the best course of action, Vince Bezemer, senior vice president of strategic business development at engagement banking platform Backbase, told Bank Automation News.

“To really be in control of your own destiny — both overall and digitally — we feel that our customers need to have that self-control and that avoidance of being locked in [to one strategy or the other],” Bezemer said. “Then, they can start planning for what is important to their customer base.”

The $139 billion KeyBank, for one, needed to move massive amounts of data with a less costly but more flexible system, Bezemer said. The Cleveland-based bank used Backbase’s cache management capabilities to help migrate data without suffering loss of information and helped pilot commercial banking tool KeyNavigator.

“With the data reporting KeyBank wanted to do with these large data sets, building would have been extremely expensive and taking a cookie cutter [piece of tech] didn’t satisfy all the needs they had,” Bezemer said.

Banks in the driver’s seat

A strategy of acquiring cost-effective tech, and building a solution if none is available, puts banks in the driver’s seat when it comes to allocating funds for digital transformation projects — and whether to outsource or build technologies using internal resources.

Financial institutions need technology and architecture to rapidly consume and combine business capabilities from a variety of internal and external sources, according to Jost Hopperman, vice president of banking applications and architecture at market research firm Forrester.

“A bank leveraging existing technologies — particularly from outside of the bank and in the cloud — and using tools to build, buy and assemble new capabilities, is better prepared for this new ecosystem focused banking and tech world than those who don’t,” Hopperman told BAN.

As banks migrate data to the cloud and determine whether they will buy the automation technology, build it themselves or acquire fintech that offers the tech, it’s critical for them to consider the specific needs and requirements of their customers, he noted.

“We want to give banks full control of what they’re bringing to market, and they don’t have to look like the community bank from around the corner,” Bezemer said.

Bank Automation Summit Fall 2022, taking place Sept. 19-20 in Seattle, is a crucial event on automation and automation technology in banking.  Learn more and register for Bank Automation Summit Fall 2022.