A couple of months ago at Temenos my team had the chance to think up, build and launch a new product.
I would say it is a hybrid tech and knowledge product. It’s called the Innovation Acceleration Platform and it’s meant to speed our clients up in their innovation and ensure they get to the consumer with some of the magic value prop our platform’s FinTech providers bring, fast and before others.
I’ll spare you the details as to what it contains but in essence it’s a box inside which, any Bank Innovation team finds two of the only ingredients they need to accelerate their efforts and test cool propositions – the Tech (near production ready environments at the drop of a hat preloaded with the right kind of data) and the Know-How (access to curated cream-of-the-crop FinTech and to those that did the curating).
Now I’ve taken this box to bankers and boy was I pleased to see where we are today as compared to the days of dry, in a vacuum, self-indulgent innovation labs of yesteryear. These guys are on the ball! Not one still does useless pilgrimages to the Valley “to see where technology really is”; no proud walls of posters preserved for eternity and no obsessive focus on hipster premises.
It strikes me like there is a lot more value being created these days.
A lot less focus on form in lieu of substance and a real sense of urgency for making some of the digital promises happen before it’s too late.
It was always the job of the Innovation or Digital teams in banks to be frustrated to no end by the Business Prevention Departments (J.P. Nicols ™) but for many years that frustration seemed to stop at man-buns and long beards starting to sport greys and to revolutionary new FinTech StartUp pipe-dreams being laid in front of terrified other CanaryWharf patrons every Friday afternoon.
These days that frustration seems to have shifted into pushing these modern day banking renegades to roll up their sleeves and take the battle with those departments heads on.
Over the last few years we’ve seen some fractions of valiant bankers tackle Regulation Business Prevention with every weapon from hackathlons to lobbying for a new set of people dictating it, who they knew to be capable of understanding FinTech.
We’ve seen them then fight the Procurement “Computer-Says-“NO” corporate inertia that disallowed them from engaging with promising new propositions with weapons ranging from low-key sponsorship of incubators and accelerators to full ownership of these.
We’ve seen them try and better the culture at times with long, arduous, inside-education battles setting up programs to get the whole organisation at the same level of knowledge and thirst for technology such as my Build-a-Voice Emotional Banking ™ programs. They educated not only exec teams but departments that were adamant they had nothing to do with all this FinTech marklary such as Operations or HR because they knew that the more people that see the promise, the more likely it is to get there.
Over the past few years of the struggle Innovation teams had in banks there was one department that never let them down. That always seemed to know enough. And (lowkey) care enough. A department who was not only a sine-qua-non ingredient in trying to get anything new in front of a consumer, but was also, mercifully, poised and ready to make any of the digital dreams happen as soon as the Business Prevention Departments stopped trying to impede progress.
That department was IT.
I’m afraid I’m here to say that I have a feeling that it’s over. That along the way, over the past few years, that department stopped being an ally. That they no longer are poised and ready to help. That they have become one of the Business Preventers. Let me tell you why.
For those of you reading this who are not in banking, this is of course a generic abstraction, “The IT Department” is comprised of tens -if not hundreds- of other departments and teams tasked with technology maintenance for lack of a better description.
As soon as they went digital, banks have become, whether they like it or not, if not technology creators (depending on whether you want to call ugly hacks and desperate fixes keeping it all together – “creative”) at least technology maintainers with systems that grew so complex they need immense operational effort expenditure.
Over the past few years, not only has technology exponentially grown inside banks but it has even faster developed outside them. Software development has undergone more change than they acknowledge for such a new discipline. Due to the very nature of the industry, they constantly challenge their method and process and try to better themselves immediately and measurably to get better output. Which makes everything potentially faster and better but effectively more complex.
These days, software houses everywhere struggle with maintaining vision and direction while adopting new methods and technologies every week to create faster. This would be disruptive to any line of business leave along one that now underpins the fabric of society. They cope by the grace of the fact that many are of a manageable size with a clear profitability goal and they can adapt internal culture to be permissive of uncomfortable rapid change and open to testing and developing.
Banks’ IT Departments are a lot like software houses. One would argue they are software houses.
What they are not is creators. What they are not is agile. What they are not is, in possession of a culture that sees sense and is unencumbered by Banker-Guilt ™ and ready to be truly agile in the name of a firm profitability goal as the private software houses so they don’t cope.
They too used to feel the Innovation team’s pain and frustration and wanted to build top propositions back in the day. After all, the IT Department is made up of a bunch of uber-smart geeks perched for technology advance. But as opposed to their younger Innovation brother in arms who, while prevented effectively, is at least mandated appropriately, the IT Department was never appointed by the business as the creator, just the custodian. So that frustration has never turned into creative tension and gusto for the end goal of the business.
A few years of having been discouraged, disillusioned and disrespected has led Bank IT Departments to becoming a Business Prevention department themselves.
These days when the all-grown-up-and-now-taken-seriously Innovation team turns to them for help to make happen the dreams they once had together, they often see they’re left behind. Unwilling to try new things, complaining about infrastructure challenges, crippled by the many “No”s they heard.
Say the Innovation team finally finds the killer app that will make our mobile banking less “meh” and they have finally been allowed to engage if not even purchase it by the Regulator and Procurement Preventers, and they’ve educated the exec team enough not to try and stop them, they’ll run back home to their old playmate the IT Department, to help them prove it or even help them bring it to market in their propositions and they will find a new breed of “Computer says “No”.
Security concerns they would have helped explain and alleviate to the rest of the business in the olden days are suddenly being raised. Resources whether it’s developers or testing environments or data are always impossible to reach and all tied up for eons. Proof of concepts are impossible to organise, integration would only be doable post a major transformation process, and working with the new fanged FinTech provider is nary impossible when they insist on all those fancy dev tools and protocols that don’t match theirs.
Related: The Banker and the Sour Grapes
So now nothing fast and cool is possible. Again.
We built the Innovation Acceleration Platform for an extra push. Thinking it would supercharge banks proposition creation at a time when they need to hurry up and bring compelling new ideas to consumers faster than ever. We didn’t think it would be as necessary or even in places, mandatory as it is. That the very part of the business that ran faster than the entire organisation has been brought to crawl over the past couple of years, ironically, partially halted by its own complexity in addition to the organisation. That’s truly sad.
The good news is that there is enough thirst for awesome tech out there and Innovation and IT seem to become interchangeable in some places Some banks have merged the two as they should have to begin with. Some have appointed DevOps wizards as Chief Innovation Officers and some have taken previously disillusioned IT heads and COOs and asked them to design Open Banking business propositions.
Now that the Business Prevention departments are losing their grip the only prevention is in your ability to execute and it’s becoming clear that to drive cool and exciting props in banking you can no longer design what you want to make but how to make it as well. The lines are getting blurred, teams are working together and there is plenty of tech smarts and good will to go around and make things happen.
Change is not only uneasy but sometimes sad, but it’s happening in our industry and it’s happening fast and those that learn to ride with the wave will certainly see exciting results and as usual, if they do, so will the Money Moments consumer.
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