Change isn’t easy
Oddly enough, Reilly says the biggest challenge in executing this greenfield program has not been a technical one. “This is not a criticism of the way we’ve been doing things,” he says. “It’s an embrace of the disruption that’s occurring in the market.” Still, unsurprisingly, it caused some workers to question, “What does this mean for me in the future?”
Workers aren’t judged based on the number of boxes they manage, or how virtualized an environment is. “’How am I delivering against the goals of the firm, how am I managing risk, and how am I contributing to overall profitability?” are questions he encourages workers to consider now.
Pulling out the team that worked on the greenfield project as a separate entity was one key to success. Gartner has encouraged this bi-modal IT approach of dedicating a team to work on a new project while still ‘keeping the lights on’ for the rest of the organization. Reilly said it took about a year to get everyone on the same page.
The project would not have been possible without Reilly’s bosses – Chief Operations and Technology Officer Catherine Bessant and CEO Brian Moynihan - embracing a long-term, five-year strategic planning initiative. At a recent all-company meeting Moynihan cited the technology infrastructure group as an instructive example of simplification driving growth within the enterprise. “You can imagine what that did for our team,” Reilly said.
Having engaged and committed workers and higher-up support is key, but staying abreast of new technology and innovation in the market is another. To help find those young startups that could be a benefit to the bank, for the last seven years Bank of America and Merrill Lynch have run a Silicon Valley Technology Innovation Summit. Hundreds of startups apply each year to attend. BoA invites a couple of dozen. On average, the bank ends up engaging with 17% of the startups who pitch at the conference.
Hindsight is 20-20
If there’s one thing Reilly wishes he had known before he started this process – one lesson he could impart on enterprises who want to go on this journey themselves -it’s to not underestimate the cost of legacy systems. It was essential for BoA to scale down the costs of the existing, legacy system (called the brownfield) as that new, greenfield environment was being spun up. If you don’t cut brownfield costs as you’re investing in the greenfield, then you’ll just be adding cost.
Doing so is not easy. Physical assets need to be depreciated off the books, along with associated maintenance contracts. Software agreements need to be written in a way where you’re not carrying more licenses than needed. Doing all this allows an organization to “monetize the shrinkage,” Reilly says. Doing so will free up money to invest in new, greenfield projects. “In large enterprises, we haven’t seen a problem we couldn’t engineer our way out of,” he says. “We are great at adding stuff, but we’re not so great at taking stuff away.”
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