As competition in the financial services market heats up, and maximising sales per customer becomes a growing priority, organisations are progressively exploring how to revamp their back-end infrastructures to support future growth.

Although the sector is relatively buoyant, it is facing competition from several quarters. Especially important is the continued creation of ever larger and more powerful players, as small- and medium-sized investment banking and insurance firms are being swallowed up through merger and acquisition activity.

Many companies are now looking outside of their domestic borders for potential growth opportunities.

Interest is particularly high in creating pan-European entities that can not only respond to the challenges of globalisation, but also help organisations avoid local anti-trust scrutiny.

At the same time, financial services firms are also looking at how they can insulate themselves from the effects of bad debt levels, while trying to respond to high-street retailers that are undercutting rates and continuing to extend their range of offerings.

Jerry Norton, director of strategy for global financial services at consultant LogicaCMG, says there is a growing focus on bundling products and services and attempting to cross-sell them, particularly to high-value customers.

‘Organisations are also trying to improve customer care and differentiate themselves, which they can do either through product or channel innovation,’ he says. ‘This puts pressure on IT to demonstrate more agility and flexibility, which means that there has been a cranking up from the cost-cutting agenda of the last five years or so.’

One of the key areas where innovation is likely to take place is in online bank account delivery. Most banks, for example, still only provide a crude entrance to the web, but there is a move to try to learn from the experience of retailers as a means of selling new and existing products to a broader market.

To improve customer service, financial firms are also starting to take stock of their current IT environments to understand how they can provide a simple, clear view of customer information – despite having a wealth of overlapping systems in place.

Although it is still early days, there is a widespread interest in standardising, rationalising and integrating core data and applications in line with revised, or in some instances newly-created, data management strategies.

Jason McLean, vice president of financial services for consultant Capgemini, says that one of the key trends centres on achieving a single view of the customer, with the aim of delivering the holy grail of customer intimacy.

‘But this means starting again at the grass roots level to get the data right and understand what service it supports,’ he says. ‘Trying to join up products and services is not new, but what we are seeing now is a lot more activity to try to get it right this time.'