Slowly, weakly, Kiwibank is quietly releasing new, mostly cloud -based technologies that promise to transform business from customer back to core.
Among the range of new technologies delivered or planned, the bank chose London-based Thought Machine, founded by former Google engineers, to provide its new cloud-native core banking platform.
Thought Machine says its Vault software-as-a-service (SaaS) platform delivers a large portion of the functionality needed to run a bank, along with services from other vendors that connect through application programming interface (API).
As reported earlier this week, Kiwibank also selected a new Azure -based payment platform from Miami -based ACI Worldwide, a platform rebuilt on SaaS principles.
Reseller News ask Kiwibank for a peek under the covers of what is shaping up to be an incredibly low-key but wholesale innovation.
“One of the philosophies we’ve taken on these things is:‘ better than said ’,” Kiwibank CEO Steve Jurkovich explained.
Kiwibank recognized the need for renewal in the middle of the last decade, but has notoriously weakened. If anything, the pace of change of systems has only accelerated since then. This time, however, it is different that the philosophies and every move are deeply considered and tested with customers and team members to center on those ruminations.
We did some paper based analyzes and then they very quickly came to a proof of concept with Kiwibank engineers building minimal viable products to really understand the technologies behind them.
An extensive, two -year global search has helped the bank manage the available stacks of technology, but it has also reinforced the fact that a seismic shift is happening.
“What really surprised me by looking at the world, is that a lot of technology stacks especially in banking and financial services are on top between loosely integrated monoliths and moving to cloud native,” he said. Jurkovich.
That requires choices whether to accept new things or to get the latest version of an existing system.
“The metaphor I used with a lot of people when I talked about it inside and on our board was: you know, if we were setting up a mobile network we would be 5G, right?” Said Jurkovich. “We wouldn’t go 3.5 and then think well maybe we’ll go to four and we’ll go from there. So that’s the choice we were making.”
Jurkovich said executives also need to have relatively high beliefs about their change options because technology is changing rapidly.
“It’s really tempting to sit on your hands and think that something better is coming, and it usually happens, but eventually you have to go on the field and start playing. That’s what we chose to do as quickly as possible, really. . “
Another realization is that although the core is important, it is a mistake to be overly obsessed with it. There are many other choices that must be made as well.
“In the whole environment we want to offer, it’s an important part, but it’s only a part,” Jurkovich said. “Bigger discussions and really interesting discussions are around multi-cloud, hybrid-cloud, data sovereignty, things like that.”
Then there is delivery. Does Kiwibank want to be its own system integrator or look for partners? And right there smack in the middle of all that, the COVID-19 landed. Trying to bring in people from offshore has become “bloody impossible,” Jurkovich said, as the local market for talent has heated up sharply.
“We were pretty far off the runway when the pandemic hit and it caused us to rethink where these centers of excellence are around the world and how many people we can get on the ground,” Jurkovich said.
Partners are required
A big part of the answer to that challenge is long -term partner Datacom. Just across the road from Kiwibank, the two organizations have even shared a major shareholder with the Guardians of NZ Superannuation.
Inevitably, there have also been conversations with regulators about the emerging cloud banking strategy that has led to industry work on both topics. In that context, working with technology to see how it works has become even more important such as establishing certain foundation principles such as “secure by design” and “following by design”.
Kiwibank’s wrong start to innovation has left a legacy of under-investment.
“If you’re thinking about a double debt reduction in technology and the debt process, we’ve probably suffered there,” Jurkovich said.
It’s a journey facing all banks around the world, including working out how to stay safe and function while changing and how to still serve, in the case of Kiwibank, a million customers.
Moving to the cloud can help to meet many of those challenges, though. For example, by switching to subscriptions and by reducing the need to invest in hardware and redundancy in advance.
“Old technology is being eaten up by new technology,” Jurkovich said. “You don’t want to upgrade your old stuff. You want to eat it up by moving on to new stuff.”
Kiwibank has already taken a big step towards process agility when it invested in technology from ServiceNow that helped it transform its operating model, a capability that has significant value during a pandemic and is likely to pay additional bonuses that support bank transfer to the cloud.
The Thought Machine selection was marked by 12-15 months of preparation for the next stage, the start of a different kind of rollout.
“It’s a thin slice of what we’re going to deliver, but we also recognize that that’s the way the world is today,” Jurkovich said. “You added, delivering things in drops and thin slices instead of, you know, here’s my project at Uber and it’s a waterfall, and it takes five years, and somehow I convinced you that on the 16th of February 2025 at 9am, I will give it my all. “
A world of threats
Last year’s stability issues also brought home how important it is to invest to stay safe in a global world full of threats.
“It’s very good to talk about them in theory, but I think when you almost look at some of them you recognize that those threats are doubling every 15 or 16 months. There are a lot of company directors and executives that should ask themselves if they are doubling their own capacity at the same time. “
Read more on the next page …
Join the newsletter!
Error: Please check your email address.
Tags accentureDatacomgenesysDynamics CRMbankingkiwibankEYRoamCloudAWS. MicrosoftThought Machine