V Chandrasekhar IT Advisor [email protected] Issues and Challenges in IT Enabled Business...
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Transcript of V Chandrasekhar IT Advisor [email protected] Issues and Challenges in IT Enabled Business...
V ChandrasekharIT Advisor
Issues and Challenges in IT Enabled
Business Transformation Programs
V Chandrasekhar, IT Advisor [email protected]
Origins of Business Transformation
V Chandrasekhar, IT Advisor [email protected]
Pre 2000- Technology in Banking
Business High Margins No Competition Vanilla Products
Low Technology Levels Very low levels of computer literacy Low Levels of Computerisation Resistance to Change Replication of Manual Process Regulator Driven Computerisation only for Accounting Automation
All other Sectors took to IT in a big way while Banking remained untouched by
sweeping changes in Business Environment
V Chandrasekhar, IT Advisor [email protected]
Pre-2000 Technology Scenario
Year SystemPre 1980s Ascota URE M/c
1980s ALPM
Late 1980s / Early 1990s
Unix Systems / Mainframes for back office / MIS
1990s TBM
1995 Swadhan ATMs
Late 1990s MICR
V Chandrasekhar, IT Advisor [email protected]
Evolution of Automation and Its Business Impact
Pre-1960s Manual Brs, Sellers Mkt
1960s Manual, URE, Electromechanical LPM
1970-80 Manual, LPM, ALPM
1990 Manual, ALPM, TBM
2000 Manual, ALPM, CBS Power Shift from Sellers to Buyers
2002- 2004 End of EDP Era, CBS, TBM, Manual Self Service Channels RTGS and Payment Systems
Post 2005 Foundations for Global Banking
EDP
Accounting / Back Office Focus
Disabling Env
Branch Automation
Networking, ATM
Fee Income, Marketing
Enabling Env
IT as Business Enabler
Disruptive Changes
Consolidation
V Chandrasekhar, IT Advisor [email protected]
7 Layers of Technology Evolution in PSBs
1. Technology Hostile2. Technology Averse3. Technology
Tolerant4. Technology Friendly5. Technology Enabled6. Technology Savvy 7. Technology Driven
We are here
V Chandrasekhar, IT Advisor [email protected]
Drivers of Change Deregulation Globalisation Increased competition Demanding customer Convergence Complexity – Banking, Insurance, Broking,
Commodities Trading Complexity of Instruments / Products Delivery Complexity - Multichannel Compliance Complexity - Basel – II, SOX, SEC Economic Complexity – WTO, M&A, Ownership
Transformation During Disruptive Changes
V Chandrasekhar, IT Advisor [email protected]
New Challenges Dwindling Employee / Customer Loyalty Plastic Money Electronic Payments Net Banking New Identity Management Issues Security Issues Credit Boom Emergence of Rural Market Growing SME / Retail Credit Cut Throat Competition Increased Risk appetite of the customer
V Chandrasekhar, IT Advisor [email protected]
Business Challenges - Competition
Customer Attrition Talent Attrition Business Attrition
V Chandrasekhar, IT Advisor [email protected]
IT Challenges – Fragmented IT
Complexity Machine Proliferation Loss of Control Architecture Management Talent Management
V Chandrasekhar, IT Advisor [email protected]
Challenges- Case of Four Blind Men and the
Bank
IT – not understanding Business Requirements Business – not understanding IT requirements
and specifying their requirements IT terms, Ownership Issues, IT blamed for Business Failures
Consultant – not understanding ground realities Customer – As a consequence , he turns blind
eye to business and business collapses
V Chandrasekhar, IT Advisor [email protected]
Business Failure Lack of Technology Lack of Knowledge to exploit
Technology Lack of Enabling Processes / Systems Lack of Strategy
Book of Instructions or Book of Impediments
V Chandrasekhar, IT Advisor [email protected]
The New Wave
V Chandrasekhar, IT Advisor [email protected]
Why it is called Transformation
End to End Deployment of IT It affects all aspects of Business
Strategy Technology Process People Brand Premises Business Enhancement Business Consolidation
Time to Change is short
Change was always there , it is only the rate of change
that is making us study it as a science
V Chandrasekhar, IT Advisor [email protected]
Transformation Drivers
Business Strategy & Architecture Technology Strategy & Architecture Behavioral Strategy & Architecture ( HR)
V Chandrasekhar, IT Advisor [email protected]
Change & Transformation
Change TransformationNew Orgn Legacy Orgn
Incremental Complete
Local Global
Point Enterprise wide
Specific Cultural
Pain not felt Extremely painful
Quick Results Slow
Short Period Very Long Period
V Chandrasekhar, IT Advisor [email protected]
Business Transformation – Final State - Global Bank
Corporate Centre Structure as per Global Best Practices
Customer Centric Organisation – LOBs Service Delivery Technology Market / Brand Positioning Global Culture
V Chandrasekhar, IT Advisor [email protected]
Agenda for Transformation
Strategy – Global / National / Niche Organisation Structure Enterprise Business Architecture Enterprise IT Architecture Transformation Program Performance Measurement
What can be measured - gets done
V Chandrasekhar, IT Advisor [email protected]
Transformation Pre-requisites
Top Management Ownership Sponsor Project Mode Business Driven Communication with key stake
holders internal and external – Unions, Associations, Media, Analysts
V Chandrasekhar, IT Advisor [email protected]
Business Issues – Take a Global View
Separate strategy from Business and IT Focus on Building Agile and Adaptive
Enterprise View of an Integrated Connected
Enterprise Enabling BPR & Change Mgt Environment
V Chandrasekhar, IT Advisor [email protected]
Reasons for Poor IT Absorption –Avoid IT / Business Disconnect
IT not participating in Business Strategy formulation
Business implementing IT without involving IT IT by itself cannot provide value Only business derives value from IT IT is concerned only about performance of IT
systems Business Strategies , Goals , Policies must result in
IT projects IT Representation at Board Level
V Chandrasekhar, IT Advisor [email protected]
Business Issues – Customer centricity
Customer, rather than account, focused business New Lines of Business (Customer Segmentation) Channel Management Customer Relationship Management Re-Brand Marketing Focus
V Chandrasekhar, IT Advisor [email protected]
Business Transformation – Technology
CBS Internet Banking Lending Automation Cash Management Global Treasury GL Risk Manager ALM HRIS Multi-Channel Delivery Networking Security Infrastructure
V Chandrasekhar, IT Advisor [email protected]
Business Transformation – Operations
Operational effectiveness and efficiency thru Technology
BPR Shared Services E-Strategy - Multi-Channel Delivery Lending Process Automation Performance Measurement Telecommuting / Working
V Chandrasekhar, IT Advisor [email protected]
Technology Challenges
V Chandrasekhar, IT Advisor [email protected]
IT Issues Customer Data - MCIF Data Migration Historical Data Storage / Retrieval Record Management Universal Teller BCP at Branch / Bank Level STP Integrate HRIS DWH / BI / CRM Basel – II Testing and Acceptance Security Policy Project Management Tools
V Chandrasekhar, IT Advisor [email protected]
IT Issues
Cost of IT Perishable nature of IT Technology Refresh Need to get ROI Faster
Business needs to Leverage
IT investments Quickly
for Survival
V Chandrasekhar, IT Advisor [email protected]
Business Issues - Ownership of IT Projects
Business Owners LOB Heads
Technology Owners IT Head
IT Enabled Business Transformation
V Chandrasekhar, IT Advisor [email protected]
IT Governance
IT Business Alignment Old, Transition, Final Models Security Policy BCP
V Chandrasekhar, IT Advisor [email protected]
Sourcing Models
Assets Owned and Managed by Bank
Assets owned but FM outsourced Assets and FM both outsourced
Onshore / OffshoreDonot Outsource
Strategy, Architecture, Design, Security
V Chandrasekhar, IT Advisor [email protected]
IT Deployment Management
Data Center & Rollout Mgt Disaster Recovery Center Business Continuity Plans DRS Governance DRS Drills
Transfer & Recovery at DRC Return of Control to DC
V Chandrasekhar, IT Advisor [email protected]
IT Management Challenges
Security Management Record Management Channel Management Shared Services Management Risk Management Compliance Reporting
V Chandrasekhar, IT Advisor [email protected]
HR Challenges
V Chandrasekhar, IT Advisor [email protected]
IT impacting HR
Universal Teller Extended Hours Banking Sunday / Holiday Banking Mobile Banking Mobile ATM Global Treasury BCP
V Chandrasekhar, IT Advisor [email protected]
HR Issues Skill / Talent Identification Competency Mapping Career Planning Succession Planning Performance Measurement Rewarding Performance / Excellence
V Chandrasekhar, IT Advisor [email protected]
HR Issues
Constant transfers Lack of specialisation Moving to / from Rural to Urban
Areas Transfers when LOBs are formed HR policy on transfers
V Chandrasekhar, IT Advisor [email protected]
HR Issues - Managing Digital Divide
Management / Employee Training Including top management training on use of digital dash
boards , DSS Customer Behavior Monitoring thru Multiple delivery
channels Product Design
Customer Training New Generation Customers can handle complex products They can handle self service channels Older Generation needs simple products and human touch
V Chandrasekhar, IT Advisor [email protected]
New Skills
V Chandrasekhar, IT Advisor [email protected]
New skills - Business Strategy Best Practices / BPR Risk Management Financial Engineering Performance Management Reporting Treasury HR Marketing Branding
V Chandrasekhar, IT Advisor [email protected]
New skills - Technology
Strategy IT Architecture Vendor Management SLA Management Security Management
V Chandrasekhar, IT Advisor [email protected]
New Skills
MCIF CRM HRIS Datawarehousing Business Intelligence
V Chandrasekhar, IT Advisor [email protected]
New Designations - CXOs CEO – Chief Executive Officer COO – Chief Operating Officer CFO – Chief Financial Officer CTO – Chief Technology Officer CSO – Chief Security Officer CCO – Chief Compliance Officer CRO – Chief Risk Officer CMO – Chief Marketing Officer
V Chandrasekhar, IT Advisor [email protected]
IT brings fundamental changes in the style of doing business.
Willingness and Ability of business to adapt to these
paradigm changes is critical for any technology driven transformation program
V Chandrasekhar, IT Advisor [email protected]
Success of an enterprise depends on building internal
skills and competencies on an enabling (IT) agile infrastructure
and govern it wisely for business results
V Chandrasekhar, IT Advisor [email protected]
In aligning the organization, communicating the strategy is not
enough -effective communication is backed up by
enabling processes and structures -that essentially translate strategy into
day-to-day activities. In short, effective strategy has to be
embedded in work.
V Chandrasekhar, IT Advisor [email protected]
Delivery is all about Leadership,
Communication, Culture and People
There must be someone in the organisation to put it out of comfort
zone – on a continuous basis
V Chandrasekhar, IT Advisor [email protected]
Summary Ensure Sponsorship Identify Change Agents Increase number of believers Create an entrepreneurial environment Encourage innovation Forgive genuine failures Nothing like an overall Feel Good
Environment – Positive Strokes