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How to Become an Agile Bank

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Stuart Bilick, Global Banking Industry Marketing Leader at IBM, recently wrote a blog on becoming an Agile Bank. He says that banks face three key challenges to become an Agile bank:

  • Existing application complexity,
  • Changing customer behavior, and
  • Increasing amounts of data

To address these challenges and better serve customers, banks need to create a strategy to improve their core banking systems, according to Struat.

Banks grapple with the complexity of their existing core banking systems, and yet at the same time they must deliver on front office agendas with digitization happening around them. Cloud, analytics, mobile, security and social (CAMSS) technologies are becoming increasingly important to achieving this goal of becoming Agile.....By taking advantage of an architecture that incorporates reusable software components along with incorporating CAMSS capabilities in their customer solutions, banks can develop the right framework and the right strategy for updating core systems in place, which enables them to become more Agile in the marketplace.

Martin Cooper, technical director at SolidFire, writes in the Cloud Computing News about how traditional banks are threatened by disruptive competitors, specifically those competitors that embrace Agile methods.

The key strength of new disruptive challengers such as Apple Pay and indeed, PayPal, is their willingness to embrace Agile technologies such as cloud infrastructure in order to offer consumers the services they want.... Not only can cloud solutions offer greater flexibility and collaboration opportunities, but their scalable nature means they can be used as DevOps environments for the rapid prototyping of potential new digital products and services.

According to Accenture’s blog on Agile development platforms.., banks are looking to achieve greater agility and flexibility in their product development, organizational design and customer experience capability, which should move beyond traditional application development. Designing multichannel capabilities into their IT architecture and infrastructure from the start, can help banks more rapidly address urgent regulatory requirements, accommodate business and technology change, and serve customers more effectively.

Accenture shares that creating an IT function that is more Agile and responsive to the business involves two parallel paths of activity. These are:

  • Designing more flexible enterprise architecture, mainly by reducing silos. They can do this by encouraging IT and the business to work together, using rapid application development tools, and implementing an architecture that supports delivery through multiple channels.
  • Leveraging a more flexible approach to application development using a multichannel methodology. This would entail confirming scalability and performance of platforms, focusing on platform independence that precludes committing to specific technologies, confirming interoperability of applications, leveraging a strong user-interface development capability, and using an information/integration hub for development.

Greg MacSweeney, editorial director of InformationWeek Financial Services recently wrote a post about how Capital One delivers 85% of software through Agile.

In its efforts to transform the customer experience from a traditional banking transaction to one that is more like a consumer's interaction with Amazon or Apple, Capital One is relying on Agile technology development to change the way it deploys new applications and services.

According to Rudy Wolfs, Senior VP of Card IT at Capital One, with Agile, Capital One now releases approximately 400 products a month. Currently Capital One has more than 3,000 developers and business users trained on the Agile methodology. He says that Capital One tracks nine metrics when it comes to Agile, including Agile team size, commitment level, quality of product, delivery time, cost and meeting expectations on the first deployment, among others.

Rudy shares how they promote innovation in Capital One.

We have three labs where the associates can test and learn, and to explore things that maybe people aren't thinking about. We need to do things like this because we believe we need to behave like a technology company.

In order to encourage innovation through the company, Capital One rotates developers through the innovation labs, rather than just leaving team of developers in the labs full time, although there are a few associates who are permanently assigned to the labs.

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