Summary
Most of today’s established banks run up to 40 year old IT landscapes which are not flexible enough to comply with regulatory requirements, changing customer behaviour and merger readiness. Therefore I expect the majority of banks to start transforming their legacy IT landscapes. Today, there is a significant shortage of professionals who have the appropriate skills and experience to successfully transform a bank’s IT landscape. 75% of IT landscape transformations of banks fail or do not deliver according to plan. To master one’s own discipline is about learning, craft and training. I personally believe that it is a craft to build future-proof IT landscapes for banks. It can be learned by serious professionals and trained by people with a rich personal experience and the ability to teach. To build a future-proof IT landscape for a bank I see the need to perform 8 major activities and there are high personal, organisational and knowledge requirements on professionals. Professionals who excel in the 8 major activities and high personal, organisational and knowledge skills I call IT Master Builders. Given the next wave of transformations of IT landscapes of banks there will be a high demand for IT Master Builders.
Banks need to transform their legacy IT landscapes
Over the last 15 years I experienced a steady increase of regulatory requirements on banks. The latest financial crisis accelerated this trend.
The rise of the Internet, new user-friendly mobile devices and social media in the last five years will generate a signification change in customer behaviour over the next 10 years. Bank customers will expect a new generation of financial services, which are convenient and location-based so that financial needs can be fulfilled immediately.
The banking industry has been contracting through consolidation for the past 20 years. Still, there are much more bank branches and banks around than gas stations and oil companies. I expect further consolidation over the next 20 years. If a bank wants to survive it must be merger ready.
Most of today’s established banks run up to 40 years old IT landscapes which are not flexible enough to comply with regulatory requirements, changing customer behaviour and merger readiness.
Therefore I expect the majority of banks to start a transformation of their legacy IT landscapes within the next ten years.
Today, there is a significant shortage of professionals who have the appropriate skills and experience to successfully transform a bank’s IT landscape
On a global scale there is a significant demand for professionals who have experience in the transformation of the IT landscape of a bank. But few people have the necessary experience to lead and to perform the transformation of a bank’s IT landscape.
My analysis show that 25% of the transformation programs are aborted, 50% are delivered while costs and timelines doubled or tripled and only 25% of the transformation programs are delivered according to the original plan.
You may ask why.
My answer: No bank holds the necessary capacities and skills to transform the IT landscape. Why should a bank do it? Until now, it was not necessary. For many banks it will be the first time and for most of the bank’s staff involved it will be the only transformation of the IT landscape of their professional careers.
So there is a significant need to prepare professionals to successfully perform transformations of IT landscapes of banks.
Mastering is about learning, craft and training
Friedrich Huebler’s blog about international education statistics shows that there is a positive correlation between education and the wealth of nations as well as education and individual income and wealth. One of my hobbies is reading biographies of great people like Jack Welch, Mao Zedong, Bill Gates, Graf von Stauffenberg and Stephen Hawking. From my point of view they are curious and share a passion for education and learning.
Learning is an essential part of mastering what you do and who you are.
Mona Lisa is the most famous painting of Leonardo de Vinci. At the age of 14 he was apprenticed to the artist Verrocchio. Leonardo was trained in drafting, chemistry, plaster casting, leather working, mechanics and carpentry as well as drawing, painting, sculpting and modelling. By the age of 20, Leonardo qualified as a master in the guild of artists and doctors of medicine. Throughout his life he improved on his painting technique. Amongst others, Leonardo mastered and further developed the sfumato technique. This painting technique makes Mona Lisa smile, uniquely. Leonardo also refined engineering drawing, which is recorded in 13,000 pages of notes and drawings.
I take away that great artist are also best of class craftsmen.
In 2008 Michael Phelps won 8 Olympic gold medals and broke 7 world records in swimming. Besides his genes and talent, he prepared his competition ruthlessly. The three years before the Olympic competition he exercised every single day for several hours, including his birthday, Christmas day and New Year’s Day. He believed that his competitors do not train on these days and that this will make the difference during the competition.
My take away is that ruthless training is a key success factor to mastering one’s own discipline.
How to build future-proof IT landscapes for banks
I personally believe that to build future-proof IT landscapes for banks is a craft. It can be learned by serious professionals and trained by people with a rich personal experience and the ability to teach.
To build a future-proof IT landscape for a bank I see the initial need to perform 8 major activities:
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1.Engage with the bank’s business strategy and with senior managers
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2.Interpret the business strategy of the bank
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3.Derive and formulate an associated IT strategy together with senior IT managers
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4.Create a vision for future IT landscape of the bank, and consider major bank business and IT trends
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5.Analyse the current IT landscape of the bank
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6.Identify transformation objectives
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7.Analyse the existing project portfolio
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8.Outline the transformation program and respective projects
There are high personal, organisational and knowledge requirements on professionals who build future-proof IT landscapes
Professionals need to have proven skills in three areas to create a future-proof IT landscape for a bank:
A) Personal
Visionary
Creative
Convincing
Have a clear vision about the future of banking and the potential of technology for banks. Also, they are able to express their visions on a personal level.
Outline new approaches and solutions and surprise people positively in their interactions.
Choose arguments carefully. Be authentic in what you say and do and approach people appropriately. People listen to these professionals and follow them.
B) Organisational
Lead people
Build high performance
teams
Manage stakeholders
Professionals know what makes people tick. They are aware of different leadership styles.
Identify the right people and build high performance teams to master the transformation of the IT landscape of a bank.
Aware of politics within organisations. Understand that there are people who support ideas, people who will fight against and people who do not care. For all the different groups, how to use different strategies and tactics to achieve the goals.
C) Knowledge
Bank and IT Trends
Bank business and IT knowledge
Outline target IT landscape
Communication
Program and project management
Manage budgets
Professionals are knowledgeable of bank and IT trends.
Highly experienced professionals have a proven track record of IT landscape transformations within banks.
Professionals have outlined target IT landscapes many times in their careers.
Professionals know how to communicate to individuals, small groups and large groups and to apply appropriate communication techniques.
Professionals have successfully run transformation programs and projects in banks.
Professionals are familiar with cost structure of banks and their IT and can manage significant budgets.
Professionals who excel in the 8 major activities above and high personal, organisational and knowledge skills I call IT Master Builders.
Given the next wave of transformations of IT landscapes of banks there will be a high demand for IT Master Builders.
Links and further readings
http://www.IT-Master-Builder.com
http://huebler.blogspot.com, Wealth and Education
http://en.wikipedia.org/wiki/Leonardo_da_Vinci
Book: No limits: The Will to Succeed, Michael Phelps and Alan Abrahamson
