IT Governance at ING

8/13/2019 IT Governance at ING

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GROUP 1Bikash Shah Avinash Agarwal

Arnav Nandy Bhasker Shrestha

Arpita Nayak Chandan KhandelwalAsish Tripathy


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AgendaAbout ING Group + Governance: Corporate and ITBikash Shah

IT Governance Structure at ING + Who Is Responsible for WhatArpita Nayak

Investor's Approach to IT-enabled Business InvestmentsAvinash Agarwal

IT governance matrixChandan Khandelwal

1 minute

2 minutes

1 minute

2 minutes

2 minutes

How the IT Dashboard Helps ING + IT Metrics + IT Metrics of INGAsish Tripathy

IT Road Map + Addressing IT Governance at INGArnav Nandy

2 minutes

Rethinking IT as an Investment PortfolioBhasker Shrestha

2 minutes


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About ING ING Group is a global financial services institution of Dutch origin

offering banking, insurance and asset management to 60 million

private, corporate and institutional clients worldwide ING employs more than 115,000 people, and 70 percent of its stock

is held outside the Netherlands.

In today's financial markets the group has a total assets of more than1.169 trillion

The mission of the group is to set the standard in helping thecustomers manage their financial future

ING aims to deliver financial products and services in the way thattheir customers want them delivered: with exemplary service,convenience and at competitive prices.


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Governance: Corporate and IT As a part of their corporate strategy, running a business is a

well organized activity carried out by professional people whoaccept full responsibility and accountability for their actions

ING is totally dependent on IT, not just for support andenhancing business, but also enabling it. The organisation isreliant upon it 24/7/365 days a year. Without IT, there would beno business.


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ING IT RoadMap Highlights

High level issuesconcerning use ofIT

Currentpriorities for ITinvestment

Ensuring IT

alignment withbusiness needs

Continue focus on E-business Further benefitsrealization

Leveraging technology for providing solution tobusiness challenges

Customer centricity

Distribution ChannelOptimization

OperationalEfficiency

Operational Costs

Organizational Agility

Ensuring BusinessContinuity

Info. security(CIA)

Optimizing coststructure

New technologyadaptation

Key IssueIdentification(Dashboard reports)


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Addressing IT Governance at ING

IT Governance Institute's Board Briefing on IT Governance encourages boards of directors toseek answers to questions such as

How does IT add value to the business?

How often do IT projects fail to deliver what they promised?

Does the board have a clear view on how much the enterpriseinvests in IT compared to its competitors?

It is a responsibility of the members of that board to ensure that the mechanisms are in placeto provide answers.


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IT Governance Structure at ING Within ING, a global IT governance structure has been

implemented that meshes with its overall corporategovernance structure. This helps ensure the strategic alignment of IT with the

business

This structure is meant not only to improve the quality ofthe IT function but also to speed up decision-making


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IT Governance Model ofING


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IT Governance Model of ING IT Policy Board : The policy is set by the IT policy board. This policy board

consists of Three board directors OPS/IT portfolio keepers of the three executive centres The director of the Corporate IT (CIT) staff department

IT Leadership Council : It consists primarily of business CIOs who advise thepolicy board. The IT leadership council has three subgroups dealing with ITstandards, IT architecture and IT infrastructure.

Information Security Steering Committee : To demonstrate the seriousnessthat ING applies to information security, there is a separate informationsecurity steering committee that also reports directly to the IT policy board


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Who is Responsible for What


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The IT dash board provided the information necessary to: Enable ING, over time, to develop and compare the most

appropriate metrics on IT spend, performance and value Enable direct comparison with specifically commissioned,

peer group information Enable direct comparison of metrics among different business

units Assist senior business and IT management to exercise their

governance responsibilities over IT investments

How IT dash board helped ING


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IT metricsThe metrics which are collected and analyzed includes thefollowing: IT costs by category and by activity IT staff numbers and costs analysed by activity Full-time vs. contract IT staff

Outsourcing ratios Workstation costs IT intensity (IT costs as a percentage of total operating costs) IT related operational risk incidents (number and value)


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IT metrics of INGThe IT metrics of ING helped it in the following way:

Have a lower cost base (in terms of the ratio of operating coststo premium income)

Spend more on IT Spend relatively more on IT development and less on

maintenance Have higher outsourcing levels


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An Investor's Approach to IT-enabledBusiness InvestmentsING has successfully mixed banking, insurance and asset management. Theorganization is mixing the roles of the chief information officer and the chiefinvestment officer.

The rewards increase with the risksuntil one enters the high-risk category.

The graph is helpful to explain whatparts of the investment portfolio maynot bring the level of return thatmight be expected. It helps to ask the right questions of

business sponsors and of IT to identifyproblems early and take whateverremedial action may be required.


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New Development Cost/Revenue Growth The IT intensity within ING was directly comparable with the high

performers.

ING operated efficiently in terms of operating cost-to-premiumincome ratio.

ING was well below best-in-class for percentage of expenditure onnew developments.

ING spent relatively significantly more on legacy systemmaintenance.

ING took less advantage of outsourcing IT compared to its fellow highperformers.


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Rethinking IT as an Investment PortfolioIT investment how to prioritize

Transactional Aim to increase efficiency and to reduce costs Informational Managing and controlling the organization Strategic

o To increase competitive advantage, enable the entry into new markets orotherwise enhance revenue streams.

o Strategic investments do tend to be high-risk but potentially have very highreturns.

Infrastructural Is not easily directly quantifiable to financial benefits

Higher performers invest relatively more in IT projects that fell into theinfrastructure and transactional categories

The higher performers among ING's insurance business units spent 79 percent

of their investment budget on projects in these two categories against 60percent for the lower performers.

The higher performers spent 14 percent of their IT investment budgets onstrategic initiatives compared to just 4 percent for the lower performers.


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ConclusionING believes the IT dashboard and the IBM/ING research are both very usefulProviding knowledge and tools that improve the IT investment process and help

to better manage IT expenditureThreefold help

Shareholder return is at least partly related to IT intensity, i.e., how much is spenton IT and how is it spent

Best shareholder return is generated by transactional (cost saving) projects because

they emphasize standardization and efficiency Creating future revenue growth and to further improve sustainable financial

performance for all stakeholders

Taken some innovative and forward-looking steps toward the achievement ofworld-class IT governance processes

ING is considering the potential benefits to the organization in providing similarIT value and performance services to other organizations as a commercialservice


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Decision Domain

GovernanceArchetype

IT Principles IT ArchitectureIT Infrastructure

and Strategies

Business Appliation

NeedIT Investment

Input Decision Input Decision Input Decision Input Decision Input Decision

BusinesMonarchy

Chairman andCEO

InvestmentCommittee

IT Monarchy CIO CIO EAO EAO

FederalArchitecture

exceptionFunding

authorization

IT DuopolyServicesCatalog

ITCouncil

CSS Board CIO

Feudal CTACAll

BusinessLeaders

CIOsBusinessLeaders

IT Governance Matrix


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TH NK YOU

IT Governance at ING

Documents

Transcript of IT Governance at ING