Evolving your bank’s business model requires close examination of what you do—and where you do it. Is it time to press reset on your location strategy? Learn more: https://www.accenture.com/us-en/insight-investment-bank-challenge-04-location-strategy?c=fs_cmfy17sldshr_10000004&n=smc_0517

1. 04TOP 10
CHALLENGES

2. CHALLENGE 04 - Top 10 Challenges for Investment Banks
CHALLENGE 04
PRESSING THE RESET
BUTTON ON LOCATION
STRATEGY
2
TOP 10 CHALLENGES FOR
INVESTMENT BANKS 2017
#IBTOP10

3. 3
PRESSING THE RESET BUTTON
ON LOCATION STRATEGY
CHALLENGE 04 - Top 10 Challenges for Investment Banks
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10 GETTING FIT
AUTOMATION
LOCATION
STRATEGY
DIGITAL
TALENT
CLIENT EXPERIENCE
JOURNEY
TO CLOUD
INNOVATION
RESEARCH
FUNCTION
BLOCKCHAIN
PRUNING FOR GROWTH

4. CHALLENGE 04 - Top 10 Challenges for Investment Banks
AS INVESTMENT BANKS
STRIVE TO…
4
• Simplify their operating models
• Become effective digital organizations
• Identify optimal revenue streams
…choosing WHERE TO DO BUSINESS
becomes a critical decision.

5. CHALLENGE 04 - Top 10 Challenges for Investment Banks
PRESSING THE RESET BUTTON
ON LOCATION STRATEGY
5
Your investment bank’s location strategy will depend on
a variety of factors—within and outside your control.
INTERNAL DRIVERS
Revenue creation
Cost reduction
Organizational effectiveness
EXTERNAL DRIVERS
Macroeconomic factors
Geopolitical factors
Regulatory obligations
Tax and legal benefits

6. CHALLENGE 04 - Top 10 Challenges for Investment Banks
PRESSING THE RESET BUTTON
ON LOCATION STRATEGY
6
For a location strategy to be sustainable, it must align with
the strategic objectives of your bank’s operating model.
SET UP
Vision and
Objectives
ALIGN TO
Operating
Model
CHOOSE
the Optimal
Location(s)
CONSIDER
the Market
SELECT
the Optimal
Strategy
IMPLEMENT
the Selected
Strategy
CONSIDERATIONS

7. CHALLENGE 04 - Top 10 Challenges for Investment Banks
PRESSING THE RESET BUTTON
ON LOCATION STRATEGY
7
What kind of hub makes the most sense for your bank?
GLOBAL
HUBS
Liquidity
Access to talent and clients
High rent and headcount costs
REGIONAL
HUBS
Functional or market specialization
Potentially limited to niche clients
(examples: Hong Kong, London, NY) (examples: Boston, Luxembourg)
Top choices for revenue-
generating activities and general
management processes
Top choices for specialization and
certain areas of expertise

8. CHALLENGE 04 - Top 10 Challenges for Investment Banks
PRESSING THE RESET BUTTON
ON LOCATION STRATEGY
8
What kind of hub makes the most sense for your bank?
Low rent and headcount costs
Potential talent scarcity
Less control
Negligible rent and no
headcount costs
Efficiency and standardization
Maintenance and control costs
(examples: Bangalore, Edinburgh, Warsaw) Everywhere
Top choices for middle- and back-office processes
that can be fully or partially standardized
UTILITIES
HUBS
VIRTUAL
HUBS

9. CHALLENGE 04 - Top 10 Challenges for Investment Banks
PRESSING THE RESET BUTTON
ON LOCATION STRATEGY
9
Location, location, location
When selecting a new operating location, ask yourself five questions:
Is the local market mature and sustainable?
Are there barriers to entry?
Can you access the human capital you need?
How hard will it be to set up operations?
How liquid is the local market?

10. CHALLENGE 04 - Top 10 Challenges for Investment Banks
PRESSING THE RESET BUTTON
ON LOCATION STRATEGY
10
At the end of the day, your
investment bank’s location
strategy must be nimble
enough to satisfy your
business aspirations and
solid enough to withstand
changes in external factors.

11. CHALLENGE 04 - Top 10 Challenges for Investment Banks
PRESSING THE RESET BUTTON
ON LOCATION STRATEGY
11
Six steps to align your location strategy and operating model
Undertake due diligence exercises to
ensure all required legal documentation,
trading agreements, licenses and local
compliance processes are in place.
01
Set up adequate legal and
compliance processes

12. CHALLENGE 04 - Top 10 Challenges for Investment Banks
PRESSING THE RESET BUTTON
ON LOCATION STRATEGY
12
Six steps to align your location strategy and operating model
Build awareness through targeted
campaigns to establish a reputation
aligned to the selected target clients,
e.g. corporates.
02
Align brand to core customers

13. CHALLENGE 04 - Top 10 Challenges for Investment Banks
PRESSING THE RESET BUTTON
ON LOCATION STRATEGY
13
Six steps to align your location strategy and operating model
Focus on firm culture and conduct,
providing adequate staff training to align
operating models regardless of local
working cultural norms.
03
Ensure cultural homogeneity

14. CHALLENGE 04 - Top 10 Challenges for Investment Banks
PRESSING THE RESET BUTTON
ON LOCATION STRATEGY
14
Six steps to align your location strategy and operating model
Set up technologies and processes in a
scalable manner to ensure that operations can
be set up safely and with ease when moving,
causing minimal risk to the rest of the network.
04
Adopt nimble technologies and processes

15. CHALLENGE 04 - Top 10 Challenges for Investment Banks
PRESSING THE RESET BUTTON
ON LOCATION STRATEGY
15
Six steps to align your location strategy and operating model
Have necessary resources in place to enable
quick pop-up of teams in low-cost locations
to keep rent and headcount costs low.
05
Ensure adequate infrastructure and planning

16. CHALLENGE 04 - Top 10 Challenges for Investment Banks
PRESSING THE RESET BUTTON
ON LOCATION STRATEGY
16
Six steps to align your location strategy and operating model
Take advantage of a mixed global talent
force, leveraging niche skills in given local
markets, and offer competitive incentives
adaptable to local culture.
06
Attract top talent

17. CHALLENGE 04 - Top 10 Challenges for Investment Banks
PRESSING THE RESET BUTTON
ON LOCATION STRATEGY
17
Optimal resource distribution
Business continuity
Client satisfaction
Cost savings
Skilled talent
Organic and inorganic growth
Job creation
Choose well and
implement wisely—
and your investment
bank could reap the
rewards of your
location strategy.

18. TAKE THE
NEXT STEP
18
www.accenture.com/10challenges
CHALLENGE 04 - Top 10 Challenges for Investment Banks