Open Source enables customized applications

By : |November 30, 2009 0

David AwcockDavid Awcock has worked for the bank since 1991, and pioneered large-scale off shoring of IT services within the bank by establishing scope software centers in India and Malaysia. He led a major initiative to transform the banks core banking systems in more than fifty territories, thus enabling the bank to adopt the next generation J2EE; linux based system, in a multi-year program.

Awcock has recently assumed responsibility for all technology services in Standard Chartered Bank, and is engaged now in taking the banks technology capability to the next level, in support of its growth. In an interview to Dataquest, David Awcock, Standard Chartered Banks group head of technology shares his insights on the IT engine that powers the bank. Excerpts

Can you talk about your organization?

Standard Chartered is a large organization, with 70,000 people worldwide in fifty territories. As a captive IT organization, we provide a range of IT services, and act as a global technology operations backbone. We are in complete control of things going on in the bank from a technology perspective. We run two large data centersone in Hong Kong, and other in the UK; and the data centers house majority of our apps and hosting services. Only in some select instances, we have a data center within the country we operate, due to regulatory reasons. In terms of organization, we have close to 8,000 people worldwide in technology; and majority of them are in our three centersChennai, which is the largest followed by Kuala Lumpur; and Singapore. And in all these centers, we have development, delivery, and infrastructure services.

The IT services we deliver are centralized and standardized. For instance, the three centers work in seamless fashion; and in case of any problem, we can easily flex between the centers. We are an organization with very efficient processes in place, but we manage it in a rather traditional way that is aimed at significant technology delivery and developmental capability.

Can you elaborate on the kind of applications you have deployed?

We have a large scale core banking solution, thats fully developed in-house from scratch. Its a comprehensive system that takes care of the whole range of processes. We also have specific systems for loans, Internet banking, branch, and mobile banking. The core banking system we have is an interesting one. We are one of the few organizations to have developed such a large scale CBS in-house based on open source. The System is linux based and J2EE; and is very modern. The open architecture enables us to highly customize it to our needs. The system has been rolled out across the bank in many countries, including India. We are extremely happy with the system, and its ability to manage banking operations with ease. I think the best part is that we built this system, and we can maintain it ourselves.

We adopted open source mainly because we can build an application suiting our needs. Moreover, if we are locked in a proprietary set up, we will be forced to do frequent updates. Often we have found that most of updates do not give the level of business benefits that we look for. To put it simply, we do not want to be forced to do an upgrade just because a new version is available.

Can you talk about the kind of RoI you have derived by setting captive IT units for Standard Chartered?

We had made the decision to set a captive unit way back in 2001, and Chennai is a major technology hub for us. We have grown significantly in the last few years .We are very pleased at the way things have panned out; and we have derived very significant cost savings. If I were to take a rough estimate of RoI, we are saving millions of dollars every year due to captive IT outsourcing; quantum of savings are very significant, and that I think is a big deliverable.

If you look at the last one year, many large enterprises have gone slow on new IT purchases. How did you manage IT spending issues over the last year?

Like everybody else, we did feel the impact of recession. But we have taken a conscious decision on what to invest, what not to invest. The critical areas that need new investments were done; but certain areas that can wait for a while were put on hold. We measure all our IT spends. Some are tangible, and some cannot be measured. For instance, investments on desktop infrastructure has lots of intangible benefits. Some do not have a direct RoI. I think IT investments are made with operational efficiency in mind; and as an IT organization our aim is to create an environment that fosters business and organizational efficiency, and uniquely align IT with business goals. Since we have linux based banking solution, we are effectively positioned to meet the wide ranging specific requirements.

How do you manage IT procurement?

We are very clear when it comes to procurement. We adopt high degree of IT governance. Our strategy is fewer vendors, and long lasting relationships. For instance, for networking we have two core vendors; and for hosting we have one more in addition to our own. This strategy gives us high degree of manageability; as well as making the business run 24/7 without any down time.

Obviously you are managing a huge PC fleet. How do you manage it?

We have close to 70,000 PCs, of which approximately 20,000 are notebooks. We use software distribution services to manage a range of desktop services. We use concepts like virtualization pretty aggressively; and mainly in areas like managing DR, and giving flexible work schedules for employees, like working from home. In these instances virtualization is a great technology. We are also exploring concepts like VDI; but looking at the cost dynamics, right now it does not make a compelling case to deploy VDI on a big scale.

What are some of the best security practices you adopt?

Security is indeed critical in a banking environment. We have a dedicated security division. They manage the multi pronged issues involved in security. The security teams play roles like managing and pre-empting threat scenarios to end point management. Information security is indeed a continuous challenge; but we have well laid out policies and defense mechanisms in place.

Any new technologies you will be looking at closely in the next one year?

We will be looking at technologies that improve customers experience. We will also be looking at VDI, and broad based virtualization to a larger sample. The bottom line is we will be exploring technologies that improve efficiencies across the enterprise. We will be looking at technologies like unified communications, and business process management.

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