Transformational Banking Under the Tuscan Sun

My wife loves the movie Under the Tuscan Sun so, by default, I love the movie Under the Tuscan Sun. This past Sunday it was raining in Toronto and my wife and I spent a lazy afternoon on the sofa. Under the Tuscan Sun happened to be on so while I was catching up on some reading my wife was dreaming about renovating a villa in Tuscany.  I was reading the article “Down Under on Top” in the November issue of Banking Technology, about the strides Commonwealth Bank of Australia is making with their mobile offerings. During the read one of the main characters of the movie said the following:

Signora, between Austria and Italy, there is a section of the Alps called the Semmering. It is an impossibly steep, very high part of the mountains. They built a train track over these Alps to connect Vienna and Venice. They built these tracks even before there was a train in existence that could make the trip. They built it because they knew some day, the train would come.”

I’m not sure if the quote from the movie is true. It sure sounds nice though and it really got me thinking about the difference between a core banking transformation based on pure strategic intent and one based only on stated value drivers. I know that most reading this will not easily be able to decouple strategic intent and stated value drivers (this is a common problem in business today where strategy and tactics are interchangeable). So let me explain.

Stated value drivers are normally predicated on improvements in existing processes or operations; the known, the stable, the seen. These stated value drivers do not see the future and in the end, when adopted as the goal of a transformation initiative, they limit an organizations choices in solution , timeframe, chronology of deployment, and budget based on associated gains in immediate value and short sighted quarter by quarter financial planning (they are tactical in nature not strategic). Strategy for me is two things; one, preparing your environment prior to engagement and, two, the plans that an organization makes to counter a competitor’s actual or predicted moves. In banking, and in all business for that matter, speed is a tactic that can make the difference between success and failure. Speed to market with a new product, speed to address new regulator requirements without having to slow current operations down, speed to react to ever changing customer desires and requirements. Strategists that understand the tactical need for speed and  also understand that speed comes, not only via faster processes and processors, but also through a flexible environment and organization will naturally come to the conclusion that Commonwealth Bank did. That is that preparing the environment to be flexible without immediate regard for short term value realizations can have untold benefits when new requirements, like mobile, demand that you be tactically flexible.

In the article Commonwealth’s CIO states that their ability to deliver their mobile solutions with greater speed and greater scale than any other financial institution in the world is due to their investment in realtime systems that are part of their transformation strategy. A strategy that was kicked off in 2008, but planned years before. A strategy that could not have foreseen the requirements in the mobile space but built a flexible enough platform to allow Commonwealth to use speed as a tactic to move ahead of their competition and differentiate themselves in their markets. In a sense they built the track before there was a train that could make the trip.

Successful transformations have to look longer term and plan their delivery against what makes sense in the larger vision of the bank not just the immediate quarterly value that might be realized. Balancing the two points of view is the art  required to transform a bank quickly and successfully.

2 Responses to Transformational Banking Under the Tuscan Sun

  1. Fully agree. You have a unique way of delivering the message and that makes it so very interesting and get absorbed quickly.

  2. Thanks George.

    Finding the right balance between taxtical speed and thoughtful design for adaptability is exactly the differentiating factor between successful banking transformations and pure core banking system replacement projects.

Leave a Reply

Skip to toolbar