Financial institutions aren’t seeing ROI on technology spend without standardized and automated development environments

Financial institutions are facing challenges in achieving return on investment (ROI) from their technology spend due to issues such as incorrect initial investment decisions and not considering 'day 2' overhead. The financial sector has unique demands, with security and compliance being top priorities. Recent analyst research highlights a shift from the traditional 'build over buy' approach, with banks now allocating more than 70% of their tech budgets to automation, AI, developer productivity enhancements, blockchain, and other technologies. However, even between the highest tech spenders and lowest tech spenders, banks are seeing less than 45% return on their tech investments. One major contributor to this lack of ROI is 'day 2' overhead, which refers to the operations and maintenance expenses of software. To address these issues, financial institutions should consider platform as a product thinking and focus on supporting the inner loop, both of which can be immediately supported by automating and standardizing development environments. Gitpod offers a self-hosted, not self-managed solution for automated and standardized development environments that helps banks increase ROI on tech spend.