In a landscape where financial services must innovate like nimble fintechs while maintaining legacy-level compliance, the latest report from New Relic unveils a staggering cost: US$1.8 million per hour in high-impact IT outages.
The Observability Forecast for Financial Services reveals insights drawn from 156 IT and engineering leaders within the sector. They indicate that outages are not only costly; they are alarmingly frequent. Nearly 29% of respondents report experiencing high-impact outages weekly, predominantly caused by network failures (37%), software deployment issues (34%), and environmental changes (32%).
Consequently, engineering teams are spending an average of 31% of their time on such disruptions, diverting focus from strategic innovation.
As regulatory pressures mount alongside increasing customer expectations, observability has transformed from a technical luxury to a crucial business imperative. For 39% of firms, security, governance, risk, and compliance are the main drivers of observability adoption, yet customer experience has emerged as a primary competitive differentiator.
With 33% of financial leaders emphasising the need for robust observability to enhance digital experiences, institutions are prioritising tools like digital experience monitoring (DEM) to ensure seamless mobile banking performance.
New Relic’s chief technology strategist, Nic Benders, stresses that financial institutions can no longer afford to operate "blind." The transition from experimental AI to robust operational intelligence demands a new level of rigour.
This framework enables firms to monitor performance across diverse technology stacks effectively, setting the stage for real-time decision-making.
Moreover, the report indicates that observability investments are yielding significant returns. An impressive 42% of respondents report seeing a return on investment of at least 2x. Key ROI advantages include improved collaboration between teams and enhanced risk mitigation, allowing institutions to reallocate valuable engineering time from reactive measures to high-value strategic projects.
In today's dual-speed reality, where speed must coexist with regulatory compliance, observability provides the clarity and control necessary for financial institutions to remain competitive. As they face threats from agile fintech startups and tech giants, business leaders and heads of operations must embrace this transformative technology to safeguard customer trust and drive innovation.
