Bain Financial Services Modernization 2.0 – Bankwatch
Bain & Co
Financial Services Modernization 2.0
The technology decisions of financial services firms have always shaped their success, but the acceleration of AI and advent of new competitors from big tech and fintech have upped the ante. Now, the pace, complexity, and scale of modernization are only increasing. Instead of tackling one initiative at a time, companies are running multiple modernization efforts in parallel and moving faster than ever amid mounting pressure from boards and competitors alike.
Explore five decisions that matter mostwhen modernizing, and hear from top industry leaders about eight success themes rising to the top.
1. Modernization is modernizing.
Companies are running multiple, concurrent modernizations with shorter timelines. The vendor landscape is evolving, competition is intensifying, and boards are pushing for tangible results. Financial services tech leaders must evolve how they engage and motivate leadership and business.
2. The value case for modernization is growing.
So is pressure to show it. The value case must be granular and comprehensive enough to stand up to multi-year scrutiny. Sustain buy-in by demonstrating early wins across business, operations, tech, and risk.
3. Destination-back planning matters.
Even as plans evolve, staying disciplined and laser-focused on a value-centered end state helps teams maintain buy-in and see modernizations through.
4. Data modernization is foundational.
Modernizing data is a complex, multi-year transformation in its own right—but as AI accelerates, it’s critical to address it as part of a broader tech modernization. Invest now in cleaning your data assets, setting up real-time streaming architecture, and resourcing teams with data talent.
5. Product management must evolve.
A strong product manager cohort is essential. Leading banks are investing in renaissance leaders who excel at “stratecution”—that is, blending strategy, technical fluency, and business acumen in end-to-end delivery. Modernizations will succeed or fail based on the strength of talent.
6. AI is a modernization catalyst.
Financial services companies must be prepared to move the needle on AI in the next one to two years or risk being left behind. Those racing to build agentic AI capabilities and curate unstructured data see the strong potential to move up modernization timelines.
7. Vendors are raising the bar.
New, next-gen AI platforms and emerging players are speeding up modernization. Some vendors are aspiring to radically compress migrations to a matter of a few months. Financial services companies will need to challenge legacy planning assumptions to successfully shift to modern platforms.
8. AI is reshaping tech functions.
AI is removing grunt work and enabling tech teams to focus on higher-value work and better manage an ever-growing backlog. AI will fundamentally change and accelerate modernization, but firms must continue to invest in technology as competition blurs the line between financial services and tech.
