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Examining the ‘instant-on’ bank

Vincent Soh | April 27, 2011
In today’s 24x7 business environment, most financial institutions are modernising their IT portfolios to become ‘instant-on’ banks to meet customer demand for flexible, efficient and cost-effective support. At a recent roundtable discussion, an exclusive group of top FSI executives discussed pressures on today’s banking services.

“The demand for banks to provide both mobile banking services, and flexible, efficient and cost-effective support to customers around the clock, is only going to get stronger and stronger, and it is not something you can run away from,” said Ross O. Storey, managing editor of Fairfax Business Media Asia (FBM) as he commenced this 28 January 2011 roundtable discussion at Singapore’s China Club. The event was brought together by CIO Asia magazine and HP Enterprise Services.

Also put forward for discussion were strategies for Asia’s financial sector to replace core services with the latest proven technologies like cloud computing, and the power of strategic outsourcing to stimulate innovation and meet customer demand.

Julian Gordon, director for financial services industry, HP Enterprise Services in the Asia Pacific and Japan, explained that outsourcing is a logical and popular way of approaching the complexities of IT environments today. “Customers who outsource can save money and have a platform to innovate,” he said. “In fact, they can use the money saved to go out and innovate, instead of being stuck there to manage the systems.” Gordon also described multi-sourcing - using different outsourcers for different environments - as a growing Asia Pacific trend, and stressed the importance of delivery, which can provide a ‘blanket of comfort and security’ through cloud computing.

Core Banking Replacement
Michael Conlin, regional chief technology officer for HP Enterprise Services in the Asia Pacific and Japan, said half the financial institutions he knows are currently replacing their core banking systems and the other half is in detailed planning to do so. “In core banking systems, you used to only get one out of three - good, fast or cheap; now you can get two out of three,” he said, adding that his rule is to deliver improved business outcomes every 90 days, which he hard codes into HP’s service level agreements.

“Change is hard,” Conlin said. “So you need to have business results that everybody understands to keep the level of support for change.”

He also explained that much of the work for banks is in clearing their huge and accumulated portfolio of applications including ‘one-offs’ while meeting the challenge of multi-channel mobility (such as iPhones and Android).

One of the financial institutions looking to replace its core systems is MSIG in Singapore.  MSIG Holdings Asia (MSIG Insurance Singapore) CIO and director, Grace Chong, said that to replace the core, the challenge was to find the right strategy in the face of regulatory requirements.

 

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