Resilience by Design
Financial services operating models and operational resilience
Financial services operating models are facing a growing need to modernise just as the regulatory push for operational resilience is reaching maturity. As parts of the world emerge from COVID-19, we believe that firms need to re-think their target operating models and integrate an operational resilience mindset into this work.
The recent regulatory push into Financial Services operational resilience is the closest regulators have yet come to scrutinising how a firm designs its internal operations. It is also a regulatory initiative that has rapidly gained momentum around the world as regulators become more alert to the risk that operational disruptions could pose just as significant a threat to the stability and soundness of the sector as financial ones.
Given all of this, firms will have to learn to live with continuous and rising regulatory scrutiny of the resilience of their operations. Financial Services operating models will have to adapt to this reality.
We believe that firms must consider the pressures of a post-COVID operating environment and the regulatory push for operational resilience hand-in-hand.
The financial services operating model
This report sets out our approach to the operating model and the challenges and opportunities that we see operational resilience presenting for it. We then propose an approach for how senior leadership can instil an operational resilience mindset into firm-wide operating model design.
Three principles for integrating an operational resilience mindset into operating model design
1. Taking a consistent group-wide approach to integration
2. Prioritising action using impact tolerances
3. Using testing to refine operating model design choices
Finally, we explain why we believe that resilient operating models will be a key competitive advantage for financial services firms in a post-COVID environment where efficiency, speed, and the digital delivery of services will be critical for firms’ success.
About the EMEA Centre for Regulatory Strategy
The Deloitte Centre for Regulatory Strategy is a powerful resource of information and insight, designed to assist financial institutions manage the complexity and convergence of rapidly increasing new regulation.
With regional hubs in the Americas, Asia Pacific and EMEA, the Centre combines the strength of Deloitte’s regional and international network of experienced risk, regulatory, and industry professionals – including a deep roster of former regulators, industry specialists, and business advisers – with a rich understanding of the impact of regulations on business models and strategy.