Title: Issues and Challenges in IT Enabled Business Transformation Programs
1Issues and Challenges in IT Enabled Business
Transformation Programs
2Origins of Business Transformation
3Pre 2000- Technology in Banking
- Business
- High Margins
- No Competition
- Vanilla Products
- Low Technology Levels
- Very low levels of computer literacy
- Low Levels of Computerisation
- Resistance to Change
- Replication of Manual Process
- Regulator Driven
- Computerisation only for Accounting Automation
All other Sectors took to IT in a big way while
Banking remained untouched by sweeping changes in
Business Environment
4Pre-2000 Technology Scenario
5Evolution of Automation and Its Business Impact
EDP Accounting / Back Office Focus Disabling
Env
- Pre-1960s
- Manual Brs, Sellers Mkt
- 1960s
- Manual, URE, Electromechanical LPM
- 1970-80
- Manual, LPM, ALPM
- 1990
- Manual, ALPM, TBM
- 2000
- Manual, ALPM, CBS
- Power Shift from Sellers to Buyers
- 2002- 2004
- End of EDP Era, CBS, TBM, Manual
- Self Service Channels
- RTGS and Payment Systems
- Post 2005
- Foundations for Global Banking
Branch Automation Networking, ATM Fee Income,
Marketing Enabling Env
IT as Business Enabler Disruptive
Changes Consolidation
67 Layers of Technology Evolution in PSBs
- Technology Hostile
- Technology Averse
- Technology Tolerant
- Technology Friendly
- Technology Enabled
- Technology Savvy
- Technology Driven
We are here
7Drivers of Change
- Deregulation
- Globalisation
- Increased competition
- Demanding customer
- Convergence Complexity Banking, Insurance,
Broking, Commodities Trading - Complexity of Instruments / Products
- Delivery Complexity - Multichannel
- Compliance Complexity - Basel II, SOX, SEC
- Economic Complexity WTO, MA, Ownership
Transformation During Disruptive Changes
8New Challenges
- Dwindling Employee / Customer Loyalty
- Plastic Money
- Electronic Payments
- Net Banking
- New Identity Management Issues
- Security Issues
- Credit Boom
- Emergence of Rural Market
- Growing SME / Retail Credit
- Cut Throat Competition
- Increased Risk appetite of the customer
9Business Challenges - Competition
- Customer Attrition
- Talent Attrition
- Business Attrition
10IT Challenges Fragmented IT
- Complexity
- Machine Proliferation
- Loss of Control
- Architecture Management
- Talent Management
11Challenges- Case of Four Blind Men and the Bank
- IT not understanding Business Requirements
- Business not understanding IT requirements and
specifying their requirements IT terms, Ownership
Issues, IT blamed for Business Failures - Consultant not understanding ground realities
- Customer As a consequence , he turns blind eye
to business and business collapses
12Business Failure
- Lack of Technology
- Lack of Knowledge to exploit Technology
- Lack of Enabling Processes / Systems
- Lack of Strategy
Book of Instructions or Book of Impediments
13The New Wave
14Why it is called Transformation
- End to End Deployment of IT
- It affects all aspects of Business
- Strategy
- Technology
- Process
- People
- Brand
- Premises
- Business Enhancement
- Business Consolidation
- Time to Change is short
Change was always there , it is only the rate of
change that is making us study it as a science
15Transformation Drivers
- Business Strategy Architecture
- Technology Strategy Architecture
- Behavioral Strategy Architecture ( HR)
16Change Transformation
17Business Transformation Final State - Global
Bank
- Corporate Centre Structure as per Global Best
Practices - Customer Centric Organisation LOBs
- Service Delivery
- Technology
- Market / Brand Positioning
- Global Culture
18Agenda for Transformation
- Strategy Global / National / Niche
- Organisation Structure
- Enterprise Business Architecture
- Enterprise IT Architecture
- Transformation Program
- Performance Measurement
What can be measured - gets done
19Transformation Pre-requisites
- Top Management Ownership
- Sponsor
- Project Mode
- Business Driven
- Communication with key stake holders internal and
external Unions, Associations, Media, Analysts
20Business Issues Take a Global View
- Separate strategy from Business and IT
- Focus on Building Agile and Adaptive Enterprise
- View of an Integrated Connected Enterprise
- Enabling BPR Change Mgt Environment
21Reasons for Poor IT Absorption Avoid IT /
Business Disconnect
- IT not participating in Business Strategy
formulation - Business implementing IT without involving IT
- IT by itself cannot provide value
- Only business derives value from IT
- IT is concerned only about performance of IT
systems - Business Strategies , Goals , Policies must
result in IT projects - IT Representation at Board Level
22Business Issues Customer centricity
- Customer, rather than account, focused business
- New Lines of Business (Customer Segmentation)
- Channel Management
- Customer Relationship Management
- Re-Brand
- Marketing Focus
23Business Transformation Technology
- CBS
- Internet Banking
- Lending Automation
- Cash Management
- Global Treasury
- GL
- Risk Manager
- ALM
- HRIS
- Multi-Channel Delivery
- Networking
- Security Infrastructure
24Business Transformation Operations
- Operational effectiveness and efficiency thru
Technology - BPR
- Shared Services
- E-Strategy - Multi-Channel Delivery
- Lending Process Automation
- Performance Measurement
- Telecommuting / Working
25Technology Challenges
26IT Issues
- Customer Data - MCIF
- Data Migration
- Historical Data Storage / Retrieval
- Record Management
- Universal Teller
- BCP at Branch / Bank Level
- STP
- Integrate HRIS
- DWH / BI / CRM
- Basel II
- Testing and Acceptance
- Security Policy
- Project Management Tools
27IT Issues
- Cost of IT
- Perishable nature of IT
- Technology Refresh
- Need to get ROI Faster
Business needs to Leverage IT investments
Quickly for Survival
28Business Issues - Ownership of IT Projects
- Business Owners
- LOB Heads
- Technology Owners
- IT Head
IT Enabled Business Transformation
29IT Governance
- IT Business Alignment
- Old, Transition, Final Models
- Security Policy
- BCP
30Sourcing Models
- Assets Owned and Managed by Bank
- Assets owned but FM outsourced
- Assets and FM both outsourced
- Onshore / Offshore
Donot Outsource Strategy, Architecture, Design,
Security
31IT Deployment Management
- Data Center Rollout Mgt
- Disaster Recovery Center
- Business Continuity Plans
- DRS Governance
- DRS Drills
- Transfer Recovery at DRC
- Return of Control to DC
32IT Management Challenges
- Security Management
- Record Management
- Channel Management
- Shared Services Management
- Risk Management
- Compliance Reporting
33HR Challenges
34IT impacting HR
- Universal Teller
- Extended Hours Banking
- Sunday / Holiday Banking
- Mobile Banking
- Mobile ATM
- Global Treasury
- BCP
35HR Issues
- Skill / Talent Identification
- Competency Mapping
- Career Planning
- Succession Planning
- Performance Measurement
- Rewarding Performance / Excellence
36HR Issues
- Constant transfers
- Lack of specialisation
- Moving to / from Rural to Urban Areas
- Transfers when LOBs are formed
- HR policy on transfers
37HR Issues - Managing Digital Divide
- Management / Employee Training
- Including top management training on use of
digital dash boards , DSS - Customer Behavior Monitoring thru Multiple
delivery channels - Product Design
- Customer Training
- New Generation Customers can handle complex
products - They can handle self service channels
- Older Generation needs simple products and human
touch
38New Skills
39New skills - Business
- Strategy
- Best Practices / BPR
- Risk Management
- Financial Engineering
- Performance Management
- Reporting
- Treasury
- HR
- Marketing
- Branding
40New skills - Technology
- Strategy
- IT Architecture
- Vendor Management
- SLA Management
- Security Management
41New Skills
- MCIF
- CRM
- HRIS
- Datawarehousing
- Business Intelligence
-
42New Designations - CXOs
- CEO Chief Executive Officer
- COO Chief Operating Officer
- CFO Chief Financial Officer
- CTO Chief Technology Officer
- CSO Chief Security Officer
- CCO Chief Compliance Officer
- CRO Chief Risk Officer
- CMO Chief Marketing Officer
43IT brings fundamental changes in the style of
doing business. Willingness and Ability of
business to adapt to these paradigm changes is
critical for any technology driven
transformation program
44Success of an enterprise depends on building
internal skills and competencies on an enabling
(IT) agile infrastructure and govern it wisely
for business results
45In aligning the organization, communicating the
strategy is not enough - effective communication
is backed up by enabling processes and structures
- that essentially translate strategy into
day-to-day activities. In short, effective
strategy has to be embedded in work.
46Delivery is all about Leadership, Communication,
Culture and People
There must be someone in the organisation to put
it out of comfort zone on a continuous basis
47Summary
- Ensure Sponsorship
- Identify Change Agents
- Increase number of believers
- Create an entrepreneurial environment
- Encourage innovation
- Forgive genuine failures
- Nothing like an overall Feel Good Environment
Positive Strokes
48THANK YOU