These are challenging times for banks. They must drive innovation for differentiated customer service while keeping core systems running, fend off aggressive competition from FinTechs and comply with increasingly stringent regulations. Within this dynamic environment, CIOs are under tremendous pressure to deliver change at high velocity.
The solution for banking CIOs to stay ahead of these conflicting and complex demands lies in embracing the concept of multi-speed IT—understanding how to shift to the right gear at the right time to achieve the right outcome.
A nexus of market drivers, customer behaviors and digital demands is driving profound shifts in the banking business and IT environment. These require a revolution in how CIOs operate their IT organizations. By mastering the art of multi-speed IT, CIOs can become integral to their organization reaching its many destinations. The journey to mastering multi-speed IT in banking is built on three interconnected components:
Pace of change: The starting point is to establish a closer connection between the trajectories of business and IT. At its heart, this will recognize the business need for IT consumption at different speeds, and balance the provision of pace with large-scale traditional delivery. Successful CIOs use governance models and processes that allow them to prioritize business demand and allocate the right mode of operations to deliver value at the right time. It is important, however, that traditional and agile delivery approaches should coexist within an integrated governance framework. This will enable fast, conflicting strategic change decisions to be made at the speed the business demands.
Architectural clarity: Leading banking CIOs will focus on tackling legacy system complexity. They recognize that simpler enterprise architectures enable clarity for multi-speed transformation, alignment between ecosystem partners, and control, re-use and simplification across the enterprise. Banks will therefore have to deepen their service-oriented architecture and business process management capabilities.
Dynamic support: Multi-speed will require a new IT operating model with business and IT interfaces driving closer alignment, new governance and change capabilities to allow full decoupling between change systems (channels) and more traditional release-based development. The enterprise architecture team will become increasingly essential in planning, onboarding, severing and maintaining this new mix of services in line with the bank’s risk profile.