Community

I think that is having a misunderstanding, between "Payments" and the full banking business, in this blockchain technology.

@Ketharaman,

"the company's mission  "replace core banking systems" - is somewhat hazy."

In my opinion is considerable hazy:

"Single source of truth for all transactions"

 This is possible, for any type of product, only, and only thanks of a STR - Standard Transaction Record  Architecture for any kind of 'product'. It does not seem that the VaultOS, support this architecture.

"SkyScraper allows applications to safely and securely connect to an existing bank account."

 So, this assumes that there is already a bank account, and therefore an old 'core system' is in place ...

"Once connected, you can read transactions and make payments."

 Once connected... So you're going to connect with the 'old' system!

Where is the replacement of the old 'Core System'?

You can read the transactions from an existing bank account... in which format? Standard?

You can make payments... How about other transactions such as: collections, depreciation, appropriations, monetary restatement, fines, royalties, default interest, dividends, contingency among many others?

"...categorising transactions into 60 separate types."

 Why 60? Why not 50 or 400? Or a flexible number of categories, according to the context?

Maybe Paul Taylor will show to us the blue skies of VaultOS, briefly...

@Vicente,

Being big is important.

Being big with knowledge is outstanding!

@James,

YES! the traditional banks will be reduced to the role of middlemen providing services to their more agile digital competitors IF they don’t act now and swiftly.
And YES, you have to pay that huge fee because you have to sustain that huge back office with myriads of legacy systems of your traditional Bank (85% of the budget just to maintain those oldies).
Just to come to reality, take the Operating Expenses of BBVA, Santander and Deutsche Bank, among others; divide them by the number of their customers and conclude how much the Bank has to suck each customer just to keep their OE.

The required future scenario is very easy to draw:

Wipe out those oldies, replacing them by simple and clever processes (item 8th of the Quesada article). How to get there is another story!

I did an essay on the subject. (There are presentations available ...).
It's amazing the savings that can be realized in OE by managing the processes corporately, online real-time, rather than processing by 'line-of-business' and batches processes.
Studies show savings of AT LEAST 10 times - not 10%.
In some cases, it can reach 50 times, depending on the backoffice entanglement - not 50%.

So, James, your withdrawals charges will certainly be smaller on your traditional Bank!

P.S.

From Fernando Lanzer’s book Take Off your glasses:

"The simple stuff that needs to be done is often scary stuff, which we would rather not face.
Hence complication is a form of avoiding the simple essence.
Complication is a form of using rationality as a shield to defend ourselves from the emotional consequences of acting."

@Vicente Quesada:

If you permit me, I would like to disagree a little with regard to the answers for the question:

“how do you transform a traditional bank into a digital bank?”

Answer a.:

Nowadays, DO NOT exist 'Digital Banks' offers on the market.

There is, however, a lot of 'cosmetic' offers - peripherals.

It is naive to expect that a Fintech Startup will present an Enterprise wide Solution for the banking business.

Startups have deep understanding of the current technology, but have not the slightest knowledge of the intricate internal "processes" of a bank.

And, in your article, in the 8th variable, PROCEDURES, about the three responsible for innovation:

"The three mentioned the importance of procedures in their Institutions."

They are absolutely right!

Answer b. ‘Develop projects internally’:

It should be internally or externally, doesn’t matter.

The question is:  which project?

By preceding projects, you need to define an architecture, such as in building up a Cathedral.

Answer c.

No comments.

And still, on the 8th variable:

Not are the employees who should innovate.

The new Enterprise Architecture should start from a CoE, formed by experienced bankers together with updated and experienced ICT professionals.

They should draw the required future scenario, recognize the current situation and establish the path to get there.

Then the right projects will popup!

And, always keep in mind Henry Ford’s quote:

If I had asked people what they wanted, they would have said ‘faster horses.’

I'm open to discuss about this fantastic matter!

joao.bohner@gmail.com

@Jerry Silva,

The CDO has not an easy 'job description'.

For sure 'cultural change' is fundamental, and also to show executives how to get out of the thicket!

As mentioned in Fernando Lanzer’s book Take Off your glasses:

"The simple stuff that needs to be done is often scary stuff, which we would rather not face.
Hence complication is a form of avoiding the simple essence.
Complication is a form of using rationality as a shield to defend ourselves from the emotional consequences of acting."

The CDO also may behave as a "spiritual guide" on the organization. 

So, those are not 'technical issues'.

@Ketharaman,

Perfectly true!

@Tabitha,

You're right about innovation.

In my point of view:

"Wherever there is a challenge, there will be the opportunity for innovation, on any level."

And to avoid "prevent banks from reaping the benefits of digital transformation at an organisational level." the role of "Business Process Architect" makes sense.

The digital transformation must be at an organisational, enterprise-wide level!

Now try to find a clear answer to "What is Business?".


So, the chief digital officer (CDO) should be a "Business Process Architect" and an "Innovator", who will depict the current enterprise scenario.

And knowing the "current scenario" AND the purpose of the Business AND the technology available, he will design the "future digital scenario".

Current and future scenario known, an integrated plan from ITC and Business people shall clearly show the path "how to get there”, orchestrated by the CDO.

Task quite easy, no?

@Tabitha,

I think these roles can not be separated. A new acronym has to be created for these two roles, and including a third which would be the "Business Process Architect."
Not knowing the business, innovation and digitization are useless ...

If

"We are making Deutsche Bank simpler and more focused,",

why

"We closed 43 branches in Spain and Poland and proceeded to downsize or exit certain countries..." to reposition the bank for a digital future ???

Does this mean that the 'digital future' is to shrink? (Which is also happening with some major banks in US!).

No, gentlemen, the focus should be on how to marry technology with business wisely, through smart Architecture! - and to grow rather than to shrink.

As mentioned in Fernando Lanzer’s book 'Take Off your glasses':

"The simple stuff that needs to be done is often scary stuff, which we would rather not face.
Hence complication is a form of avoiding the simple essence.
Complication is a form of using rationality as a shield to defend ourselves from the emotional consequences of acting."

We are tired of knowing that the current problem of the big banks, which hinders the digitization are the 'core systems' and the corresponding 'data warehouses'.

This is the wound where one ought to put the finger!

Said!

@Dharmesh Mistry,

The purpose of this comment is not to criticize, but collaborate to improve the banking business.

Taking that in mind, I'll show some disagreements on your article on the CX subject.

The definition of CX on Wikipedia is OK.

And the CX could be Excellent or Poor.

And an Excellent CX works like a 'black-hole' which will absorb all customers around it (without marketing).

For the Customer's CX:
"The more direct control that a Customer has to understand and manage its financial position, more confidence it will have in the bank holding its assets."

I also don't agree in swapping the word “experience” for “customer value proposition”.

Take Henry Ford's saying:
" If I'd asked people what they wanted, they'd have said 'faster horses' ".

So, we as technologists, we must show the way to improve Customer's CX through technology, mainly with an excellent Business/Technical Architecture.

Let's keep in touch, for better Banking!