Dive Brief:
- Responding to startup fears about the time and monetary costs of working with big banks, Morgan Stanley is streamlining its technology acquisition process, according to a Reuters report.
- Earlier in 2018, the company turned its 20-page vendor agreement into a single page, shortening the time it takes to work with vendors from three months to a week, said Shawn Melamed, head of technology business development and innovation, in an interview with Reuters. A portal for employees to start using new tech and more opportunities to executives to test new tech are also facilitating collaboration.
- The bank is fighting perceptions that large organizations are "dumb and slow," looking to show they have "very deep pockets and scale," according to CEO James Gorman, speaking at a fintech event earlier this year. These efforts coincide with the company's launch of new tech tools and services for financial advisors in the WealthDesk suite.
Dive Insight:
From artificial intelligence and blockchain to cybersecurity, fintech is driving adoption and innovation across many technology domains. With high demand for cutting edge tech by customers and partners, reducing friction and onboarding is crucial for large banks and other organizations.
Morgan Stanley disclosed earlier this year that it is taking tech disruption seriously with $4 billion of its budget allocated to IT annually — roughly 40% of its overall expense budget. But like any organization big or small, the continuous challenge of "maintaining the ship" versus investing in new technologies poses a continuous challenge.
There are other challenges besides time and cost tied to new partnerships and integrations. Regulatory requirements make security and compliance a high priority.
Every tool, platform and application financial institutions onboard bring inherent risk to the network, and everything from third party authentication risks to vulnerabilities introduced during M&A have claimed new victims in recent months.
