HQ location: Tokyo
Number of employees: 8,000
Shin Kusunoki, Manager, financial and assset management
Nomura Research Institute's cloud-based Internet banking service has drawn only a handful of tire-kickers in its first few weeks, but executives of the outsourcer and consultant say they're confident the service will have plenty of takers.
"We expect this to be a key solution for our company and for the Japanese banking industry," says Shin Kusunoki, manager of the financial and asset management solution division for NRI, which gets about 70% of its revenue from financial services clients. The Tokyo firm, which does business with more than 100 banks in Japan, posted $4.2 billion in sales for fiscal 2010, which ended in March.
Kusunoki says "a couple of banks" have expressed an interest in cloud-enabled Web banking, which the firm completed work on in the past year. He says he's confident there will be wide adoption, given the ability of cloud computing to help ease the budget challenges faced by Japan-based banks. NRI has competition in offering cloud computing in Japan: IBM is developing cloud computing for banks, signing local institutions such as Sugamo Shinkin Bank to use its cloud-based virtual workstations. "The cloud can support other financial products. And there is an appetite for a cloud-based solution in Japan," Kusunoki says.
NRI offers consulting, outsourcing, IT solutions and IT platforms. It also offers compliance consulting. Clients of NRI, which is the largest bank IT consultant in Japan, have traditionally been Japanese asset management firms, though it has done work for the Japanese subsidiaries of JPMorgan Chase, Goldman Sachs and other Western institutions.
The firm competes with Japanese consultants and BPO firms such as Mitsubishi Research Institute, Mizuho Research Institute and Japan Research Institute and with Western firms such as Accenture, McKinsey & Co., Boston Consulting Group and IBM. It recently expanded its business process outsourcing operations beyond its asset management IT sweet spot, broadening its financial services IT offerings for the back office, such as financial reporting.
While most of NRI's business has been in Japan, it has offices in New York, London, Shanghai, Beijing, Hong Kong and Singapore. It is seeking tech partnerships to enlarge its financial BPO footprint in international markets.
Analysts say NRI is picking the right time to expand abroad in outsourcing.
"BPO right now is on the uptick," says Adam Honore, research director of the institutional securities practice at Aite Group. "Banks are trying to get rid of all the plumbing. They have these huge infrastructures, and multiple copies of the same code. So outsourcing has become popular. It's an easy win from a cost perspective."
NRI was affected by the March earthquake in Japan, which caused ATM and other service outages throughout the country. NRI is developing a strategy to soften the systems impact of future disasters through data backups other measures. It participated in the reconstruction of transportation centers and deployed backup generators to ensure its clients could access data.
