The financial services sector is investing billions in digitalisation, but most institutions are still failing to translate this investment into a sustainable competitive advantage. According to the latest GlobalLogic report, prepared in partnership with FT Longitude, up to 80% of companies risk losing their market position – not due to a lack of technology, but a lack of a coherent strategy.
The report, based on a survey of 750 business leaders in the financial sector, reveals a gap between transformational ambitions and real results. Institutions are implementing AI, cloud or automation solutions, but they are doing so piecemeal, in single projects. They lack integration between IT, product and compliance departments – and this is what determines the pace of innovation today.
AI on the sidelines, innovation in silos
The most glaring example of this gap is generative AI. Although 52% of companies are testing GenAI, it is usually only in one function – such as customer service or back office. This indicates caution, but also a lack of courage to restructure entire operating models for new technologies.
Interdisciplinary collaboration is even worse. Only 46% of organisations form teams that combine business, technology and product as early as the innovation planning stage. In banking, this percentage drops to 33%, which means that many technology decisions are made in isolation from business objectives.
The result? Only 20% of companies are actively building new business models – the rest focus on modernising existing processes. Transformation thus remains a ‘facelift’ rather than a real change of course.
Leaders play the long game
The report singles out a group of ‘Leaders’ (38% of those surveyed) who perform better financially and handle regulation better. Their advantage lies not in bigger budgets, but in consistency. They do not abandon investments when the ROI is not immediate. What’s more, 58% of them plan to further increase their innovation spending – 33 percentage points more than the so-called ‘languishers’.
Leaders also emphasise competence and organisational culture. They implement AI ethics and treat risk management as part of innovation, not a brake on it. They also eliminate internal discrepancies – while 71% of board members identify talent shortages as a barrier, only 27% of line managers see the problem in teams. The best organisations are actively closing this perceptual gap.
What is missing from the rest of the sector?
GlobalLogic identifies five steps that could determine the future balance of power in the financial industry: investing before scaling, creating unified strategies, proactively funding innovation, using AI to support regulatory compliance and continuously improving competence.
The report’s conclusion is clear: technology is no longer an advantage in itself. It is only the combination of technology, business model and an organisation’s ability to adapt that creates an engine for growth. For the financial sector, this is the last moment to move from digitalisation to strategy.
