57% of firms see digital transformation as
their most important strategic priority
NEW
YORK, Jan. 25, 2023 /PRNewswire/ -- A majority
of financial services firms now view digital transformation as
essential to their business and are already looking to the next
wave of technology to help get ahead, according to a new report by
Broadridge Financial Solutions, Inc. (NYSE:BR). In the 2023
Digital Transformation and Next-Gen Tech study of 500 C-suite
executives and their direct reports across the buy side and sell
side globally, 71% said artificial intelligence (AI) is now
significantly changing the way they work, and 60% agree that within
ten years, blockchain and distributed ledger technology (DLT) will
become the core of financial markets infrastructure.
Despite a more challenging economic environment, firms are also
accelerating their funding of digital transformation initiatives as
they anticipate further widescale adoption of new and more powerful
technology. Firms now spend 27% of their overall IT budget on
digital transformation – a 16 percentage point increase versus the
2022 study.
"A new chapter in digital transformation is emerging," said
Tim Gokey, Chief Executive Officer
of Broadridge. "In our work with clients across the financial
services industry we see leading firms are already reaping the
benefits from digitalization and the use of technologies such as AI
and blockchain/DLT, as they adapt to economic headwinds and new
competitive dynamics. Firms are now looking ahead to what
their customers will require five to ten years from now, and how
technology can help them to deliver that vision."
The study categorized firms as digital "Leaders" versus
"Non-leaders", based on how advanced they are in 10 of the most
essential aspects of digital transformation. These aspects include
their innovation culture, use of emerging technologies, seamless
customer experience (CX), internal skill-building, and
adoption of security and privacy protocols.
Digital Transformation Goes Mainstream
Adapting to a digital world and embracing the potential of new
technology now underpins organizations' core business strategies,
with more than half of digital Leaders (53%) viewing higher revenue
growth as one of the most important benefits of digital
transformation.
Investment in next-gen technology is now understood to be
essential in preparing for the future. Fifty-seven percent of firms
agree that falling behind in digital transformation will hurt their
ability to attract and retain talent, further impeding their
ability to unlock new and innovative tools and platforms.
The 2030 Technology Landscape
Significant advancements in AI, data analytics, and real-world
applications for blockchain and DLT are driving momentum and
optimism among leading financial institutions. In fact, 80% of
survey respondents say the industry will have modernized its tech
stack before we land a human on Mars, a major technology feat
currently estimated to happen by the early 2030s.
Respondents expect more nascent technologies to make significant
progress as well. Firms classified as Leaders plan to increase
investment in quantum computing by 16% on average over the next 2
years; however, firms are only increasing investments in the
metaverse by 5% on average, indicating more of a "wait and see"
approach before committing funds.
The Digital Divide
Industry incumbents face challenges from new entrants to the
market and will need to embrace digital solutions to maintain their
market position. The study examined the differences between
traditional financial firms and Digital Natives, defined as online
banks, brokers, robo-advisors, and digital wealth management firms
established in the last 15 years and not part of an incumbent
firm.
The report found Digital Natives are more likely than
traditional firms to place transformation as their most important
strategic priority (78% versus 51%), marked by greater increases in
digital investments. Seventeen percent of digital natives also
report being at the advanced stages of deploying AI, blockchain,
cloud, and other emerging technologies, versus 7% of traditional
firms.
The full 2023 Digital Transformation and Next-Gen Tech Study can
be found here.
Methodology
This Broadridge survey was conducted by ThoughtLab Group to
understand how financial services companies are digitally
transforming and adopting AI, blockchain, and cloud technologies.
C-suite executives and their direct reports from 500 financial
institutions globally on the buy side and sell side were surveyed,
with fielding completed in Nov 2022.
The total assets or AUM of companies in the sample ranged from
$1 billion to over $250 billion. The study scored firms on a range
of factors related to progress with digital transformation. Firms
were then categorized as digital Leaders or Non-leaders in the
Broadridge Digital Transformation Maturity Framework. For further
details on survey methodology, please contact a Broadridge media
representative.
About Broadridge
Broadridge Financial Solutions (NYSE: BR), a global Fintech
leader with more than $5 billion in revenues, provides
the critical infrastructure that powers investing, corporate
governance and communications to enable better financial lives. We
deliver technology-driven solutions that drive business
transformation for banks, broker-dealers, asset and wealth managers
and public companies. Broadridge's infrastructure serves as a
global communications hub enabling corporate governance by linking
thousands of public companies and mutual funds to tens of millions
of individual and institutional investors around the world. Our
technology and operations platforms underpin the daily trading of
more than U.S. $9 trillion of equities, fixed income and
other securities globally. A certified Great Place to Work®,
Broadridge is part of the S&P 500® Index, employing over
14,000 associates in 21 countries.
For more information about us and what we can do for you, please
visit www.broadridge.com.
Investors:
Edings Thibault
Head of Investor Relations, Broadridge
broadridgeir@broadridge.com
Media Contact:
Gregg Rosenberg
Broadridge
Gregg.Rosemberg@broadridge.com
+1-212-918-6966
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SOURCE Broadridge Financial Solutions, Inc.