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EIU/Booz Allen Process Utilities Survey - Economies of Scale for Efficiency and Growth
Survey focuses on management strategies for financial services, including an emerging model of efficiency enhancement and cost reduction known as process utilities.
Decentralized organizational structures in financial services often make it politically difficult to standardize common processes and realize efficiencies, while varying regulatory regimes in different areas may constrain where processes take place and how they are structured. As a result, major efficiency programs in the U.S. banking industry implemented from 2002 through 2006 have not paid off as expected, and costs have continued to grow more quickly than revenue in most of the industry.
These issues were the focus of an Economist Intelligence Unit (EIU)/Booz Allen Hamilton survey about cost-management strategies for financial services that was conducted in the summer of 2007. In particular, the survey focused on an emerging model of efficiency enhancement and cost reduction known as process utilities.
Unlike many previous cost-cutting efforts that have focused primarily on corporate support functions like finance, accounting, human resources, and procurement, a focus on process utilities requires institutions to examine opportunities to aggregate similar activities that are core to the delivery of products, services, and revenue — for instance, checking or mortgage activities for retail banks, or trade execution for investment banks. Further, by adopting process utilities, firms have the opportunity to more systematically share best practices, promote a more consistent customer experience, and maximize cross-selling opportunities, driving higher customer satisfaction and improved opportunity for growth.
Download the EIU/Booz Allen "Process Utilities Survey – Economies of Scale for Efficiency and Growth."
story updated March 25, 2008
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