Why vendor selection in BFSI vertical is critical?
In my earlier blog on ‘Technology vendor selection in BFSI vertical is critical for business success’ I have highlighted the need for identification of a technology vendor who specializes in BFSI vertical to meet the needs of Banking, Financial Services and Insurance Industry. I have also stated that it would be ideal if this vendor specializes only in the BFSI vertical so that his time and efforts are not diverted in to other un-connected verticals.
In response to this blog, I have received some feedback from my learned colleagues working in other technology companies. They questioned my ‘assumption’ – they have renamed my findings as assumptions – that only those vendors who exclusively specialize in BFSI vertical can meet the needs of Banking, Financial Services and Insurance Industry. According to them it does not matter whether one specialize in BFSI vertical or not; as long as one is strong in required technology, one can serve any type of industry.
In my considered opinion, those vendors who specialize only in BFSI vertical can meet the entire needs of Banking, Financial Services and Insurance industry clients comprehensively as they can only offer client centered services and products. They can only
- Focus on clients’ needs
- Present solutions to business problems proactively
- Look forward to long term relationships
- Provide partnership orientation
- Analyze payback, ROI, Impact on business meaningfully
- Integrate value added offerings into strategies
Other vendors can also claim to offer services and products to Banking, Financial Services and Insurance Industry. However they will
- Focus on their products and technologies only instead of clients’ needs
- Present information in reaction to a request
- Have short term focus
- Have vendor/buyer orientation
- Build on their profit margin only
- Have no controlling strategy to facilitate clients
Vendors who specialize only in BFSI vertical can only answer effectively all the following questions
- What is the BFSI clients problem or need
- Why is this problem a problem
- What outcomes or results do they want
- Which results have the highest priority
- What solutions can one offer
- What results will each solution produce
- Which solution is best
Only such vendors who specialize only in BFSI vertical can offer value to the BFSI industry clients on all the fronts, namely
- Financial gain (lowest price, highest total value and lowest total cost of ownership)
- Quality (Total quality management, maintainability, ease of use, fewest problems , fewest rejects and fewest reworks)
- Infrastructure improvement (most flexible, most advanced, most open solution and automating a labor intensive step leading to straight through processing)
- Industry trends (keeping up with market leaders)
- Minimizing risk (financial stability, solid management plan, relevant experience and high ethical standards)
- Competitive advantage (simultaneous improvements across the organization)
Finally, only such vendors who specialize only in BFSI vertical can persuade the BFSI industry clients by thinking their thoughts, feeling their feelings and speaking their words. They can only understand the language of the ‘heart’!
Thanks for this opportunity to clarify. Any more doubt?
CXO Insights
