New research from document automation business UpSlide reveals that the investment banking sector is wasting millions on underutilised and badly managed software. 

With investment banks waiting nervously for the new government’s Autumn Statement later this month following a period of macroeconomic uncertainty, investment banks are cutting IT budgets and placing greater emphasis on return on investment (ROI). 

In a survey of more than 600 IT and innovation professionals in the investment banking industry, UpSlide found that 94% of respondents said they are facing budget cuts this year, with one-third facing cuts of more than 20% as investment banks scale back in the face of ongoing uncertainty. 

35% of those surveyed believe these cuts could impact business performance, while 43% believe they could impact the quality of customer service. 

At the same time as investment banks are scaling back IT budgets however, UpSlide’s research reveals that current software spend is not being used effectively.  More than two-thirds (68%) of IT leaders surveyed believe firms are wasting over a quarter of their remaining budget on underutilised and redundant tools. 45% of investment banking IT leaders with £10 million+ budgets meanwhile, report that half of that is wasted on redundant or underused software. 

It's unsurprising therefore that, faced with tighter budgets and IT waste, more than half (55%) of respondents are looking to establish stricter SLAs with software vendors and that ROI has become the most important metric when it comes to choosing providers. Asked what factors are hindering ROI on software spend, 68% of respondents identified poor training while 52% identified integration with existing tech as an issue.

Commenting on the findings, UpSlide CEO Julien Villemonteix said: 

“The last few years have proven challenging for investment banking globally with macroeconomic and geopolitical factors weighing on confidence. While we’re seeing conditions improve and deal flow increasing, confidence is still muted and strained budgets are leading to a greater focus on ROI.” 

“Software and tech remain one of the biggest areas of investment for the investment banking sector, as firms look to compete in new technologies ranging from AI to automation. These technologies are crucial to gaining a competitive edge, for example by allowing analysts to deliver pitchbooks both at speed and without inaccuracies. As revealed by our research however, the scramble to innovate and onboard new tech has come at the expense of proper integration and deployment and firms are wasting millions on underutilised tech every year.” 

“A simple solution for IT leaders in the sector faced with budgetary constraints is to make sure that the tech they’ve already onboarded is being used effectively and is integrated fully into wider systems and processes.”

“Longer term too, our research points to the growing importance of ROI and onboarding when it comes to SaaS in the investment banking sector and the growing role that APIs will play in helping IT leaders build coherent tech ecosystems.”