SmartStream: unprecedented growth and specialist knowledge

5 February 2017  •  Author(s): Peter Garnham, Editor, FX-MM

SmartStream: unprecedented growth and specialist knowledgeSmartStream CEO Haytham Kaddoura explains to FX-MM editor Peter Garnham how specialist knowledge is driving unprecedented growth at the company and why banks are now willing to entrust the firm with entire parts of their back-office operations.

Kaddoura and SmartStream enter 2017 in an ebullient mood and for a good reason. 2016, he says, was a fabulous year for the company, with a strong turnaround meaning that the majority of the firm’s 2017 target has already been achieved on day one of the new year.

“Customer feedback has been excellent. Our focus is on how to enhance our alliances with our customers,” says Kaddoura. “That has been our primary goal since the beginning of last summer, and it has been good to see it come to fruition in our product lines and on our development pipelines.”

Discussions with clients, he says, have moved to ‘a whole new level’ as the firm helps them to address their compliance concerns with new solutions. The firm is also undertaking a major managed service project with a tier-one global bank in the reconciliations space, and is in talks with three other global banks to provide a similar service.

“Instead of them running reconciliations themselves, we take over part of their staff, increase efficiency and cut their costs significantly,” says Kaddoura. He estimates those cost savings can amount to as much as 20% to 30% as SmartStream builds efficiencies into banks’ processes.

SmartStream transfers some bank staff and operations in-house, overseen by its senior management. The firm has a significant team across the globe – in excess of 700 staff solely dedicated to the enhancement and customisation of their core solutions. But these are not generic consultants, according to Kaddoura.

“These are people that have developed our solutions, worked at banks and know the real logic behind a reconciliation business for a bank,” he says. “These are not pure technical specialists or generic consultants trying to adapt to new functions. These are people that add value, make amendments where they need to be made, and shave significant dollars off the cost of any bank’s infrastructure.”

Real specialists

The willingness of global banks to push out their operations to third parties has gained traction over the last few years, as they recognise the benefits of outsourcing to real specialists, Kaddoura says.

“Every bank has an agenda today: they need to look at either compliance or cost or both because their avenues of revenue generation are now becoming increasingly thin,” he adds. “On the cost side, this approach has proven to be very popular with banks, especially with tier-one institutions that have global coverage and teams all over the world.”

Many of those banks have already been through the outsourcing process, but in a generic manner, according to Kaddoura. SmartStream, he says, has taken the process a step further, addressing banks’ needs in a more efficient and precise manner – strategically and surgically.

“It is proving successful with the banks with which we are in discussions. They have tried generic consultants, but this is not the same. It is the difference between a patient going to see a general practitioner as opposed to a neurosurgeon,” says Kaddoura.

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