MICROSERVICE AND BACK OFFICE: TWO FOCAL POINTS FOR THE INSURANCE AND FINANCE SOFTWARE MARKET IN THE NEXT FIVE YEARS

Finance and insurance players have accumulated application tools over the past decade: some have several hundred of them, implemented internally layer after layer.

Over the past 10 years, the digital revolution has put pressure on IT directors to make increasingly elaborate and intuitive web and mobile interfaces available to end customers. The digital revolution began with the appearance of websites, then web applications, then finally, mobile applications and connected objects.

Absorbed by evolving needs and the need to appear ‘modern’ in a competitive world, a great many finance and insurance players were obliged to delay the overhaul of their back office and have subtstantially overcomplicated their information system by increasing middle-office and front-office applications.

Maintaining, upgrading and extending information systems comes at a significant cost. Many IT directors are obliged to find solutions to better control these costs.

THE DIGITAL REVOLUTION IS FAR FROM OVER!

Having begun by successfully providing the front ends essential to their operation, businesses are now faced with a need for structuring. The challenge for the new digital revolution will be the industrialisation of information systems: team organisation, process automation, standardisation of exchanges between components and the consolidation of functional components. These subjects will become essential in the digital revolution over the next five years.

THE BACK OFFICE, FROM HOLDING BACK TO DRIVING THE DEVELOPMENT OF SERVICES

Finance and insurance specialists will have to stand out from the competition by radically transforming their back office.

The latter is currently the major determining factor in terms of the means and timescales required for the integration of a new application. With the digital revolution, habits have changed… Every professional user of back office systems is also a personal user of consumer applications. The gap between the user experience of consumer and ‘professional’ applications is becoming wider and is increasingly standing in the way of managers’ expectations.

Within this context, the front ends originally aimed at customers or partners are becoming the tools of back office managers. The technology implemented to meet B2C needs has now spread to all front and back office user interfaces. Information systems are therefore being redesigned around a modular, interconnected and open back office architecture.

Based on this service layer reflecting the business’ stability, front ends, for their part, follow the latest trends so that they can always provide the best user experience possible.

BREAKING THE ORGANISATIONAL LIMITS OF INNOVATION

THE DIGITAL REVOLUTION THAT IS SHAKING UP FINANCE AND INSURANCE ISN’T TECHNOLOGICAL ANYMORE. IT’S ORGANISATIONAL!

The stability of technologies has allowed the development of an offer of frameworks that is currently very extensive. These frameworks allow a considerable acceleration in the development of applications. Indeed, the ‘Open World’ offers a wide range of solutions to manage almost all the technical problems development teams are faced with. This profusion has completely shifted the complexity of application development: the need to master technologies has been replaced by the need to master the assembly of components that are independent from one another.

With successive versions of existing frameworks and with the appearance of newcomers, this new complexity continues to increase over time.

In the next five years, the market for software dedicated to the realms of finance and insurance will probably structure itself around new application frameworks, no longer constructed in the form of a framework, but in the form of functional components that can be shared and reused within the company.

This sharing that has been made possible within companies will spread outside companies. The community will become the carrier for an offering of open and reusable functional components.

It’s true that the market is currently still struggling to offer these application frameworks which are designed on the basis of functional problems. However, with the emergence of new standards such as Devops and Micro-Service architecture, the new digital revolution will enable the development of new applications through the reuse of independent and generic functional components. The standardisation of exchanges between components and their implementation will simplify technical assembly problems.

Capitalising on and sharing these new functional components will be a major lever in reducing cost and increasing quality, although we mustn’t forget that organisation is key to mastering development through component assembly.

LAURENT PYTEL
CHIEF TECHNOLOGY OFFICER