The banking industry stands at a pivotal crossroads. As customer expectations soar and digital-native competitors proliferate, banks are under immense pressure to modernize their core systems. Yet, for many established institutions, the prospect of a full-scale, "big bang" core replacement is daunting—fraught with risk, cost, and operational complexity. Instead, a new paradigm is emerging: purposeful coexistence. This approach enables banks to run legacy and modern core systems side by side, leveraging the strengths of both while minimizing disruption and risk.
Historically, core modernization was synonymous with high-stakes, all-or-nothing migrations. These projects often required years of preparation, culminating in a single, high-risk cutover weekend. The drawbacks were clear: significant expense, operational risk, and the potential for customer impact if anything went awry. Today, the industry recognizes that such approaches are not only outdated but unnecessary, thanks to advances in technology and new operating models.
Purposeful coexistence is about strategically managing the transition from legacy to modern core systems. Rather than attempting to replace everything at once, banks can migrate products, customer segments, or business lines in phases. This allows for learning, adaptation, and risk mitigation at every step.
Banks are increasingly adopting phased migration strategies, moving specific books of business, product lines, or customer segments to the new core incrementally. This approach allows institutions to:
For example, a bank might start by launching a new digital product or greenfield offering on a modern core platform, then gradually migrate existing products or customer groups as confidence grows.
Coexistence is fundamentally about risk management. By running legacy and modern cores in parallel, banks can:
This approach is particularly valuable for large, complex institutions with decades-old systems and diverse product portfolios.
Modern core platforms are typically cloud-native and API-driven, enabling seamless integration with both legacy systems and new digital channels. The cloud offers:
APIs, meanwhile, act as the connective tissue between old and new, allowing data and processes to flow across systems. This enables banks to:
Purposeful coexistence is not just a technology challenge—it requires a shift in operating model and mindset. Banks must:
Publicis Sapient, in partnership with leading core banking providers such as Thought Machine and 10x Banking, is at the forefront of enabling purposeful coexistence. Our approach combines deep expertise in technology, strategy, and customer experience to help banks:
Through real-world engagements, we have seen that coexistence is not only possible but highly effective. For example, in partnership with 10x Banking, we are helping major banks transform transaction banking and cash management solutions, leveraging the strengths of both organizations to deliver end-to-end value.
For banks hesitant to pursue a "big bang" migration, purposeful coexistence offers a pragmatic, lower-risk path to modernization. Key steps include:
Purposeful coexistence is rapidly becoming the industry standard for core modernization. By running legacy and modern cores side by side, banks can manage risk, accelerate innovation, and deliver better experiences for customers and colleagues alike. With the right strategy, technology, and partners, banks can transform at their own pace—building the foundation for a truly digital future.
Ready to explore purposeful coexistence for your bank? Connect with Publicis Sapient to start your journey.