03/18/2025
Traditional financial institutions are being challenged to operate more efficiently and adapt to changes faster than before. Where is this pressure coming from? The short answer: state and federal regulations, customer expectations, new fintech, and AI.
How are financial institutions responding? One increasingly popular option is investing in in-house resources and technology.
The Rise of In-House Resources and Platforms
Investing in in-house platforms allows financial institutions to maintain control over technology stacks, making it an attractive option for many organizations. With the commoditization of tools and capabilities that were once exclusive to technology companies, financial institutions now have the ability to create curated products that fit their specific needs. By developing their own applications and systems, financial institutions are able to move more quickly, adapt to regulatory challenges, and not be at the mercy of their vendors. Vendor partnerships are needed to realize full operational efficiencies; however, vendors support multiple organizations. This can become a risk if an institution needs to make an urgent, time-sensitive change, as the vendor has to balance the request against their other clients’ priorities and needs.
By bringing technology in-house, financial institutions can ensure that “the ball is in their court” when a change needs to happen. It gives these organizations the ability to further enhance their customer experience—by providing a curated, specific customer journey—and improve their internal operational teams’ experiences—by curating efficient operational processes.
The First Decision: Project vs. Product
In a recent client engagement, Sendero worked alongside a Dallas-based financial institution to optimize and transform their technology organization. The company’s goal was to develop and leverage in-house applications for a more customer-centric approach. As a result, the organization would be in a better position to adapt to the changing financial landscape.
In the initial design phase, the financial institution had to decide how they would approach the work. Would they use a more traditional project-based approach, a product-based approach, or a hybrid approach? Making the right decision for the institution, based on their resources, priorities, and goals, was imperative because of the potential impact of the solution’s cost, sustainability, scalability, and adaptability.
A project-based approach works well when regulatory deadlines are approaching, or when there is a need to implement quick fixes. This type of work involves:
- Fixed timelines, budgets, and deliverables
- A focus on achieving specific short-term objectives
- A structured approach aimed at completing well-defined tasks
These characteristics are often associated with market changes or mergers and acquisitions.
A product-based approach is more suited for organizations looking to foster innovation, improve customer satisfaction, and ensure sustained growth. This work involves:
- Agile, adaptive processes that can respond to market changes
- A focus on long-term scalability and customer experience
- An emphasis on continuous development and iteration
This type of work can often be found within the context of website experience and mobile application enhancements as well as customer journey modernization efforts.
Acknowledging the benefits of both approaches, some organizations are adopting a hybrid approach that combines the best elements of both project and product methodologies. For example, a financial institution may use a project-based approach to meet regulatory and reporting compliance deadlines while still simultaneously using a product-based approach for product enhancements.
Ultimately, the right approach—project, product, or hybrid—is the one that most closely supports the organization’s business strategy.
Identifying the right transformational responses in the ever-changing financial services landscape can be a challenge. Fill out the form below to hear how Sendero can help your organization meet your transformation priorities.
Contributor: Tran Nguyen-Phuong
