Keep checking this space as we will constantly be listing other events that may be of interest to you.
June 19th, 2013
Banking Outsourcers’ Worst Nightmare: Dodd-Frank – An OI 3X1
The Dodd-Frank Act’s far-reaching regulations will be a banking outsourcer’s worst nightmare. It’s critical to prepare now for their arrival, says Thomas Young, a partner with consultancy ISG and a presenter at Outsourcing Institute’s Global Sourcing – The Next Generation Road Show on June 19, 2013, in New York City.
The following are excerpts of an interview with Young on his presentation, which will explore the law’s impact on banking and outsourcing.
You claim that Dodd-Frank will be a nightmare to bankers who outsource. Why?
We’re almost three years into Dodd-Frank, and just over a third of its regulations have been written. It’s very difficult for banks to be ahead of the curve and plan when the roadmap hasn’t been drafted. Since an outsourcing deal is multiyear relationship – and rules are pending, you don’t know what the future will hold and what the rules will look like. It’s hard to build in broad flexibility that won’t undermine the deal. We’re advising outsourcers and providers to plan knowing that rules could change.
Banks know the implications. Regulatory compliance – along with managing risks and reducing costs – are their top three priorities. Today, a third of discretionary IT budgets are spent on regulatory compliance. The writing of Dodd-Frank regulations has dragged on, making this a constantly changing landscape that’s very hard to plan for. But planning remains vital.
Give us some basics. What – in essence – is Dodd-Frank and what does it have to with outsourcing?
Dodd-Frank is very broad, but at its core is an effort to promote better visibility into financial service operations. To the extent that banking and BFSI was opaque, Dodd-Frank pulls the curtain back with regulations around financial products. But it also affects the supply chain and requires companies know their employees, especially those who have access and control of systems and customer information.
The goals are laudable, but implementation of transparency and visibility taken to the extreme can expose the operation to a huge bureaucracy. And the smaller your operation – like those with less than $1 billion in assets – the harder it may be to comply.
What should outsourcing managers be doing now minimize the trauma and impact of Dodd-Frank?
First, outsourcing managers need to get briefed on the landscape to make sure their internal risk and compliance officers know how regulations in place and pending will affect operations.
Next, they must have candid dialogues with outsourcing service providers to discuss sharing the risk of change. You can’t have it all one sided. If a new regulation comes out and changes the algebra, we have to share that risk. Some buyers may say, “I’ll put all that risk on the vendor.” OK, then the vendor will just price it all back to you and you’ll pay worst case.
Instead, smart relationships have a shared-risk approach. If costs or changes exceed a certain level and change the fundamentals of the service agreement pricing, either side should reserve the right to renegotiate or terminate the agreement. That’s what outsourcing managers need to be thinking in the era of Dodd-Frank.
To meet Tom Young and learn more about Dodd-Frank, as well as Cloud Computing, The Outsourcing Paradox, and ATI (Alternatives to India), join us June 19 at Global Sourcing – The Next Generation Road Show. The event will be held at the law offices of Holland and Knight (31 W. 52nd St., New York). Click here to view the agenda. As always, the Road Show is complimentary to outsourcing buyers.
To learn more about sponsorship opportunities, email Jared Gleason.
June 26, July 24, August 14, November 13, 2013
AIT to offer Certificate Courses on Homeland-Sec, Corp Sustainability, CyberSec, Biz-Continuity
see www.aitglobal.com to get 25% discount. Supporting Association Members, Vets get a 25% discount for quality training, and don’t have to spend $2,500-plus for a multi-day Certification Course and Exam.
Seasoned instructors provide top-notch content, on par with AIT's educational Conferences with the UN and Columbia Law!
Questions? Contact Carol Lackey at 302-436-1111 or firstname.lastname@example.org.
In May, VP of National Programs Jim Tosone conducted his “Improvisation for Leaders” workshop at the SIM Mid-Atlantic, Southeast, NY Metro, and Midwest Regional Leadership Forums.
NY SIM VP National Programs Jim Tosone was interviewed for The Transformation CIO blog: “Improvisational Skills Can Elevate Innovation Leadership Capabilities” and for the No Limits podcast: “Episode 1.”
NY SIM member Mark Polansky was quoted in Network Worlds article "CIOs, CTOs shed more techie cred"
Click here to view the APC Research papers available on the national site.
SIM NY Metro
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New York, NY 10163