Outsourcing life cycle model for financial services in the FinTech era

• Main Authors: LIM, Tristan, THNG, Patrick
• Format: text
• Language: English
• Published: Institutional Knowledge at Singapore Management University 2021
• Subjects: Outsourcing; FinTech; Life Cycle Model; Innovation; Strategic management; Financial Services; Strategy Risk model; Framework; Computer Sciences; Finance and Financial Management
• Online Access: https://ink.library.smu.edu.sg/sis_research/6116; https://ink.library.smu.edu.sg/context/sis_research/article/7119/viewcontent/139.pdf
• Institution: Singapore Management University

In today’s financial services landscape, staying ahead of the innovation curve and being disciplined at enhancing core service offerings entail careful resource planning. A well-structured outsourcing arrangement can go a long way towards enhancing long term organizational strategic growth. In the post-2014 FinTech era, (i) strategic management with an innovation focus and (ii) financial technology-associated risks, have brought about changes to outsourcing in the financial services industry. Presently, most outsourcing life cycle models in existing literature seek to provide comprehensive, yet industry-neutral guidelines lacking industry context and depth of coverage. A newly licensed financial institution deciding to embark on outsourcing but is uncertain about how to thread the increasingly complex FinTech and financial regulatory landscape, will likely find domain-specific outsourcing life cycle models useful. A more targeted financial services outsourcing life cycle approach, with a focus on strategy and risk management in today’s context, can contribute more effectively to the application and review of outsourcing implementation. This research contributes to present literature by proposing a new Strategy-Risk outsourcing life cycle model. This is an elegant and simple-to-use end-to-end framework which can be utilized by the financial services industry to guide outsourcing decisions. The paper also recommends areas for future research.