Your take on ‘guidelines for banks to plan budgets for core transformation’?

Generally, the business drivers of core systems transformation are linked to the size and stature of the bank. Since Tier I banks have more to lose, their tolerance for risk is lower; these banks have to assess the potential impact of transformation on their existing product portfolio, competitiveness and regulatory compliance etc. before deciding to go ahead. Understandably, they favour a risk-managed, modular approach to transformation over big-bang implementation. The budgets follow.

For other banks, while the need for transformation is virtually pre-decided, the path isn’t always that clear. Should they start with the core or the channels? Does back office optimization take precedence over front office transformation? Must they introduce all channels at one go? With small budgets and large needs, Tier II and III banks run the risk of spreading their resources too thin in a conventional implementation. A Bank in a Box (BIAB) solution is probably a better alternative for them – with a BIAB, the banks need pay for only those functionalities that are currently required and acquire the rest at a later date. That relieves the stress on their budgets.

This is my point of view. What do you think?