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It is a pity to see the fading of an institution with so much history.

And to think that there is solution to reverse this process through the Integrated Architecture of Business / Technology - Holistic Enterprise Architecture.

As I already wrote, in my opinion the approach taken is wrong!

You have to invest to get rid of legacy systems; eliminate 'batch processes' with the corresponding silos.
You have not to play fintech startups lottery, hoping that in a stroke of luck, a miracle solution will come up that will solve all problems!

Financial transactions must be processed online, real time, completely, definitely, accurately and corporately.

This approach allows to use a single source of information for the corporation, then, yes, the costs per transaction will be reduced drastically, allowing the Bank to grow and not shrink ...

joao.bohner@gmail.com

Agree with Elon Musk that colonising Mars is easier that disrupting banking - as banking is nowadays!

And also agree with you, Dharmesh, that “there is life in the old bank yet” and that YOU can “teach an old bank new tricks”.
And "YOU" means 'solution developer/vendor', not Banks: Banks know how to make wealth with other's money not to develop technology - because of this they are still using technology from 40+ years ago!

Always remember Henry Ford, on the matter:

" If I'd asked people what they wanted, they'd have said 'faster horses' "

So, "YOU" have to “teach an old bank new tricks”...

joao.bohner@gmail.com

@Dharmesh,

Very good description of the evolution of the banking business.

I myself am a witness to the difficult times, in the early 70's.
Citibank had 3 branches in the state of São Paulo, Brazil.
The main branch was in the city of São Paulo, another in Campinas, 100 km distant and another in Santos, 70 km, opposite side.
At the end of the day we took a car to collect checks in Santos and Campinas to, at midnight, do the clearing with other banks.
During the night the files were updated, the paper lists of transactions for the tellers were printed, taken by car to Campinas and Santos, so that the branches could serve customers from 10:00 onwards. The tellers kept the balances on the paper lists updated, manually.

The cars were substituted by telecommunications.

Unfortunately, the operational inheritance of 'end-of-day processing' has not evolved and no one dares to tamper with this area.

I agree that the big step is the "digital front office", but it will only succeed if we eliminate the legacy of 'silos by product and customer segments'.

You have to invest to get rid of legacy systems; have to eliminate the 'batch processes' with corresponding silos.

You have not to play the lottery of fintech's startups, hoping that in a stroke of luck, a miracle solution will come up that will settle all frictions!

Financial transactions must be processed online, with geo-positioning, real time, completely, definitely, accurately and corporately.

This approach allows to use a single, integrated source of information for the corporation, the costs per transaction will be drastically reduced, allowing the Bank to grow and not shrink...

Then, yes, the “digital front office” will succeed seamlessly.

joao.bohner@gmail.com

Just complementing: RBS is not alone!

Imagine, if with the current operational costs the services leave to be desired, it is logical that cutting costs the services will get worse.

The approach is wrong!

You have to invest to get rid of legacy systems; eliminate 'batch processes' with corresponding silos and not play fintech startups lottery hoping that in a stroke of luck, a miracle solution will come up that will solve all problems!

Financial transactions must be processed online, real time, completely, definitely, accurately and corporately.
This approach allows to use a single source of information for the corporation, then, yes, the costs per transaction will be reduced drastically, allowing the Bank to grow and not shrink ...

joao.bohner@gmail.com

@Enrico,

unwittingly (or not) you have disclosed the killer use case for Corporate (or any) Banking:

"...a consolidated view of client limits and exposures across all corporate banking products..."

And to reach that, at a 'decent' cost/benefit, with online and real-time agility, the ONLY way is to manage banking 'corporately' (single knowledge base), rather than 'by-line-of-business' (silos).

This means to change/disrupt current technical (dis)architecture to an Holistic Enterprise Architecture, which also means not to think 'out-of-the box', but forget the box!

Agree?

joao.bohner@gmail.com

Maybe, in addition to using the granular timestamp, also number the transactions sequentially, in order of arrival ...

Wise article, Anne.

To make the "whole 'Banking Business' greater than the sum of the parts" we need to start by building the Holistic 'Banking Business''s Architecture where the RegTech, Fintech and other buzzwords are components of the Architecture - not isolated parts.

The Architecture will strongly, completely, accurately and immediately handle the financial transactions, in an Enterprisewide way - not by line-of-business - where all the Information will be 'results' of the financial activities.

Those 'results' will feed the Enterprise Information needs, like Customers financial position, the Compliances, Central Bank, accounting, Treasury, Marketing, Risk and so on...

This is the way to follow!

joao.bohner@gmail.com

Great article, Bhavesh!

It's worth a practical encyclopedia...

Do HR's recognize PO as a job?

Just one remark:
The quote attributed to Peter Drucker is from 1800's Lord Kelvin.

Congrats again for the plainness and clarity of the article!

Are banks too big to SCALE?

Yes, IF they don't act now!

What's is needed is to leave the legacy's 'comfort zone' and to chase an architecture to cope with whats changing right now.

It is worrying how the evolution of the use of technology in the financial area, is being driven by the technology and business community.
It is given as entrenchment clause, that current legacy systems of banks will remain as they are, forever.
Then, all developments are built on this (dis)architecture, creating more layers to the existing complexity.

A commendable effort was made by Barclay's, https://youtu.be/1UhrmsTZNvc, creating a smart contract prototype.
What happens is that the proposed path adds yet another layer to the existing complexity, even creating a new language.

In my mind, the ONLY way to catch up with with the current (and future) changes is to switch from processing the financials 'by-line-of-business' to processing the financials 'corporately'. And that is 'quite easy' through an "Holistic Enterprise Architecture" to reach limitless scaling...

P.S. How big can be McDonalds?