Better IT management for banks

McKinsey research into the IT operations of banks in Europe, Asia, and Latin America identifies practices that help leading institutions get the most out of their technology investments.
Some measures that bank managers assume are important, such as scale and levels of IT investment, turn out to be less critical.
Far more important is the way a bank’s IT unit forms its technology strategy together with the business. Leading banks also take a more disciplined approach to IT architecture, create standardized platforms, and wring more business value from technology investments.

Exhibit 1: Banks should aspire to spend a smaller percentage of their income on technology while still delivering the benefits the business needs to thrive.
Exhibit 2: Large, medium, and small banks are scattered in terms of IT spending relative to benefits.
Exhibit 3: Top banks in Asia choose the scope and approach of outsourcing carefully, keeping a close hand on strategically important technology capabilities and operations.
Exhibit 4: From 2004 to 2006, some banks improved, others regressed, many stayed put.