Enterprise IT Strategy

The bank’s IT needs are always individual and determined by its strategic and operational goals, legacy and the many constraints that the bank’s team is working with. There is no ideal structure of the IT landscape for everyone, the main thing is that the IT system ensures the performance of business functions at every moment and provides the necessary opportunities for business development.

In this regard, there are 3 main functions performed by the bank’s IT team.

The first function is to ensure that the bank’s business units perform operational tasks at the level necessary for the bank’s target status (Run-the-Bank). Since this area ensures the implementation of the main profitable projects, the performance of this function is often in the first priority and is performed mainly by full-time employees, since errors in the performance of this function immediately reduce the revenue of the business.

The second function is related to the implementation of changes in the IT landscape (Change-the-Bank). It is obvious that in every bank there is a gap between the existing functionality of the IT system and the target functionality that business units need to meet strategic goals. The purpose of this task is to monitor and analyze this gap in order to identify and document issues, and prioritize them in order to identify those that create the greatest constraints for the business at the moment. Thus, a backlog of technical debt is formed, which the IT team must continuously work to eliminate.

The third function is that the IT team, understanding the strategic priorities of the bank’s development, can propose innovative projects that will create new opportunities for accelerated movement towards strategic goals (Innovate-the-Bank). This feature may seem wasteful for organizations with insufficient IT budgets. Nevertheless, at the current level of digitalization of the economy, it is necessary for everyone, and with a successful combination of circumstances, it can create market leadership even for those banks that were not included in the TOP ratings in terms of assets or market share.

The perfect balance of these functions cannot be predicted, it is an art in the hands of the CIO of the bank. Nevertheless, it is possible to discuss the availability of resources for these functions. In particular, our opinion is that the Run-the-Bank function should be more based on the performance of in-house IT team specialists, since the loss of motivation of the resources providing it can have a catastrophic effect on customer satisfaction. At the same time, it is often necessary to keep only carriers of key expertise on staff, and routine tasks can be outsourced.

Outsourcing may also be in demand to support and develop legacy systems, for several reasons: the temporary nature of these works, or the availability of more accessible expertise on this system in a remote location, which will make it reasonable to involve an external team.

There may be different options regarding the Change-the-Bank function. This can be done either by an in-house team with specialists with a broad outlook in the field of technology and project management, or by an engaged external one. The advantages of an external team are related to the project (and therefore time-limited) nature of this function, and therefore the involvement of external experts can be both more profitable and easier to argue. But with the Innovate-the-Bank function, it is difficult to do without external teams, since their own resources are too immersed in the context of routine tasks, in addition, they may perceive the introduction of specific innovations as a conflict of their own interests within the company.

Our company’s specialists have experience in implementing IT infrastructure development projects in major banks and financial companies, they have worked with various options for building an IT system architecture, and understand their capabilities and limitations from experience.

We will help you at any stage of strategic planning:

• Conducting an audit of the IT landscape, analyzing bottlenecks;
• Conducting an audit of the functional structure;
• GAP analysis of IT system functionality;
• Designing the target architecture;
• Comparative analysis of alternative technical solutions;
• Development and implementation of enterprise-level systems;
• Independent expert assessment.