‘Technology Banking : Does it Deliver Value?’

Umesh JainPresident & CIOYes Bank, India

Different views

• Business View• I pay so much but get nothing

in return• Technology has ‘NO’ or

‘limited’ understanding of business

• Obsession with ‘Technology’• Technology speaks Greek• It is always about costs and

time• But programmers should use

the common sense… don’t they have any ?

• Technology is easy on spending ‘hard earned money’

• Tech View• Technology is not included in

decision making• Everything is ‘top priority’• Second class citizens when it

comes to RnR• There is very little or no

investment in technology management tools

• Very little appreciation for what goes behind the scenes in keeping the BAU running

More than Value of IT• Value question originates out of

inherent conflict• Need to attack root and not

symptoms• Both business and IT need to

collaborate and CHANGE• Some perceptions and some realities

• IT delivers value but there is scope for Improvement

• Businesses believe they are getting LESS for the money they spend, though not fully true

General Context

– Run the Bank (REDUCE)• Service/Projects– Improve Service Levels, Uptime,

Availability, TATs, standardize, offshore, outsource• Financials – Decrease costs

– Grow the Bank (MAINTAIN)• Service/Projects – Improve Service levels, Incremental

functionalities – products/services, Increased volumes/geographies

• Financials – Grow yet maintain the costs or bring down unit costs

– Transform the Bank• Catch up with industry innovations And/Or Establish blue

oceans using disruptive innovations• Financials – Based on returns and risks

Root Causes• Business Technology Alignment• Understanding, Appreciation and Respect for

each others functions• Management Viewpoint and Expectations• Soft Skills of IT • Communication of Financials

Easy to FIX using Processes

Business Technology Alignment• Strategic Alignment

– Seat for IT on Management and Strategy teams– Apex IT Council for reviewing IT strategy and

providing strategic guidance– Relationship Managers for each business area, with

dotted reporting to Business Head as also a seat on his management team

Business Technology Alignment• Tactical Alignment

– Customer – Supplier Methodologies/principles– Service Catalogues– Periodic Planning, Prioritization and expectation

setting(3-6 months)– Formal operating reviews (monthly)– Status reports using agreed metrices– Customer Satisfaction Surveys

Education and Appreciation• Educating IT about Business

– Business Conferences, Seminars, Trainings– Part of Business management team/Strategy team– Having some domain specialists in IT team

• Educating Business about IT– Processes and their benefits

• Business Justification & Approvals• Problem / Incident / Project• Financial allocations / chargebacks

– Technology trends (applied to their businesses)• How business can leverage IT better

– Management Principles

Management Viewpoint

• IT as a differentiator or IT as necessity• IT as an investment, measured like

Portfolios or IT as cost centre• IT as driver or IT as partner or IT as support

• Different Organization structures and IT management and governance Principles apply

• Competency Frameworks are useful in communicating at that level

• Often useful to engage external consultants

Competency Framework at Yes Bank

Competency (Sub Processes)

RACI

Job DescriptionOrg Structure

Training and Development

• Soft Skills• Leadership • Influencing• Communications – Verbal and Written• Marketing and Sales• Conflict Management

• Business Domains• Accounting and Cost Accounting

Financial Communication– Training on cost accounting and accounting

• How the CFO counts his beans!• Using the right yardsticks / Making the sales pitch

– Budgeting as per organizational strategy and weightages to RTB/GTB/TTB

– Measurements in terms of Unit costs for RTB/GTB operations and targets more in terms of unit cost reductions – IT should drive this

– Measurement in terms of ROI for TTB and businesses held equally accountable. To be jointly delivered by IT and Business

Recommendations

• Improve Business Alignment at both Strategic and Tactical levels

• Establish customer supplier relationship with formal paperwork and measure performance around that

• Have clearly articulated financial chargeback mechanisms – reasonably accurate and yet not very complex to implement. Run IT like a business

• Improve soft skills of IT staff – no more binary world!

• Establish governance forums to both bounce off/review your strategy as also ‘communicate’ your achievements

IT will deliver EVEN MORE value, and customer will also appreciate it MUCH MORE.