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Executing the digital strategy

Dave Gledhill
Chief Information Officer

17 November 2017

The presentations contain future-oriented statements, including statements regarding the


Group’s vision and growth strategy in the light of anticipated trends as well as economic
and market conditions. Such statements necessarily involve risks and uncertainties, 1
which may cause actual performance in future periods to differ from projections.
Executing the digital strategy
EMBED OURSELVES TRANSFORM INTO A
IN CUSTOMER 22,000 PERSON
JOURNEYS START-UP

BE DIGITAL TO THE CORE

3
EMBED OURSELVES TRANSFORM INTO A
IN CUSTOMER 22,000 PERSON
JOURNEYS START-UP

BE DIGITAL TO THE CORE

Phase 1
Fix the basics
(2009 – 2014)

4
5
*Image source: cnet.com
These foundation years were critical building blocks

Build Data Centre


resiliency revamp

Start insourcing and


build engineering Security operations Monitoring
bench strength centre centre 6
Our application stack in 2009 needed a lot of work

Overseas
Buy Hold Sell Review Singapore Hong Kong Taiwan Indonesia India China
Branches

Teller
CHANNELS

Internet & Mobile Banking


Corporate IB
CRM
Customer
CASA and FD
PRODUCTS & SERVICES

Private banking
Liquidity Management
Remittances
Unsecured loans
Secured loans
Trade Finance
Factoring
Markets
IBG MIS
ENABLERS

Credit Approval
Finance
7
And by 2014, we had fixed the basics and were ready
to build a digital bank
Buy Hold Sell Review
Overseas
Singapore Hong Kong Taiwan Indonesia India China
Branches
Teller
CHANNELS

Internet & Mobile Banking


Corporate IB
CRM
Customer
CASA and FD
PRODUCTS & SERVICES

Private banking
Liquidity Management
Remittances
Unsecured loans
Secured loans
Trade Finance
Factoring
Markets
ENABLERS

IBG MIS
Credit Approval
Finance 8
EMBED OURSELVES TRANSFORM INTO A
IN CUSTOMER 22,000 PERSON
JOURNEYS START-UP

BE DIGITAL TO THE CORE

Phase 2
▪ Increase velocity
▪ Leverage on new
technologies
(2014 onwards)
9
10
We went to deeply understand how the technology-driven
giants built and operated

11
Being the in

12
Technology transformation occurred to achieve cloud scale in
An outside-in look at the industry technology data volume, processing and change velocity. Although the
business needs & transformation journeys vary, these
journeys (of Gandalf) companies arrived at the same end-state ideal architecture

Drivers
2000 2005 2010 2015
4 years ▪ Cloud scale data volume
▪ Cloud scale data processing
❖ Inability to support cloud scale with current enterprise technology
▪ Unstructured data processing
❖ Need to handle unstructured data

▪ Complexity of environment
6 years
▪ Dependent on 3rd party vendor
▪ Deep level instrumentation
❖ Expensive and complex architecture
❖ 3 days to compile an application binary

July ‘07 Jan ‘16 – shutdown


last DC
7 years ▪ Protection against outages
▪ Complexity of environment
❖ Full day web site inaccessible ▪ Change velocity
❖ Coincide with 7 percent drop in stock price
❖ First quarterly customer loss

3+ years Our journey so far

❖ Support rapid change ▪ Cloud scale


- CI, CD, digital bank ▪ Improved speed
▪ Improved resilience
▪ Open source (e.g. MariaDB, Hadoop,
Spark, etc.)

13
We embarked on a strategy of five key elements to drive
change throughout the organization

14
15
Gandalf Transformation Targets by 2018

Become Cloud Increase Build for Data-driven Business Benefits


Native Release APIs and Culture, Analytics-
Cadence 10x Performance led Customer ▪ Cost efficiency
Science, ▪ Resilience
Instrumentation ▪ Time-to-Market
and
▪ Ability to extend to
Experimentation
ecosystems
Reduced Cost. Reduced Customer Centric. Customer Centric ▪ Ability to experiment
Improved Resilience Time-to-Market Extending to for improved
and Scalability Ecosystems customer experience

Investing in People and Skills

16
* Benefits / direct impact
To be a technology leader, we wanted to own and run our own technology

85% outsourced  85% insourced


Objectives
DBS

Outsourced Build technology DNA

Develop emerging skills (e.g. Agile, Cloud)

Increase velocity

2009 2014 End 2017

Realise tech cost savings

* DBS: includes all permanent staff and direct contractors 17


Outsourced: managed services resources
What would
Jeff do?
18
Knowledge is power

Lots of learning

Test and
Requirements
Development Quality Release
Gathering
Assurance

Cycle Time

Minimal learning

Some learning 19

*Source: Amazon
Gandalf Transformation Targets by 2018

Become Cloud Increase Build for Data-driven Business Benefits


Native Release APIs and Culture, Analytics-
Cadence 10x Performance led Customer ▪ Cost efficiency
Science, ▪ Resilience
Instrumentation ▪ Time-to-Market
and
▪ Ability to extend to
Experimentation
ecosystems
Reduced Cost. Reduced Customer Centric. Customer Centric ▪ Ability to experiment
Improved Resilience Time-to-Market Extending to for improved
and Scalability Ecosystems customer experience

Investing in People and Skills

* Benefits / direct impact 20


21
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*Image source: Exotic Pebbles
The design for modern systems – building connectors

23
Everyone has a cloud strategy , but not all are the same

CLOUD OR CLOUD TO
LIPSTICK? THE CORE?

Typical banks DBS Gandalf

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How do we achieve cloud architecture?

Traditional architecture Cloud architecture

Built for customised Built for Cloud


Hardware and Software

▪ One Supplier ▪ Open source: inexpensive to scale

▪ Customised per application ▪ Standard: fault-tolerant through automation

▪ Dedicated to one application ▪ Shared

▪ One Supplier ▪ Many suppliers: inexpensive

▪ Customised ▪ Standard: fault-tolerant through scale

25
How is DBS doing on Private Cloud journey?
Typical DBS

I want my own home % of Virtualisation Achieved

How is the
50% 93.8% Achieved
move going?
EASY VERY HARD

I want my own space Compression Ratio: Physical to Virtual

How do the
1:10 1:>65 Achieved
people share?
EASY VERY HARD

I want to keep my own Applications Moved to Cloud Optimised Software


What about the Less Critical
fixtures and All Applications WIP
Applications
fittings (software)?
EASY VERY HARD

I want to automate it Data Centre Automation


How to service
the apartments? Some Aggressive WIP
EASY VERY HARD
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Massive savings with DBS’ Gandalf Cloud approach

People -20%
Typical DBS Application

>80%

Software

VERY HARD

Hardware
Most just adopt commodity
hardware and virtualise

Traditional Typical DBS

* Technology infrastructure cost. 27


Hardware refers to compute and storage capacity, software refers to middleware and database software, people refers to administrator support
And 2018 target – able to run 50% compute on Public Cloud

Visit our
Gandalf booth to get 28
the full experience!
How are we doing on our Applications transformation Journey?

Traditional and Typical Cloud

Mostly
Regulatory
Systems

DBS Optimised Cloud


Work in 29
Progress
Modern technology must extend to Core Platforms, so we
are gradually and gracefully exiting mainframe applications

140 Mainframe - WIP


Hold - Mainframe
120

100

120
80 87

60

62
40 39
20
20 40
25 20 20
16
0
End 2016 End 2017 End 2018 End 2019 End 2020

30 30
We are therefore able to drive aggressive virtualisation
and physical server decommissioning

-25%
▪ 80% reduction in
Server footprint

-53% server footprint


▪ 90% reduction in
Non- -80% non-strategic
Strategic

Strategic
DBS Jan 2013 DBS 2015 DBS Now DBS 2018 Target

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By early 2019, we would have shrunk our Data Centres
by 75%

Typical banks
Busy consolidating Data Centres
… and doing some cloud

75%
Consolidated our physical
reduction
Data Centres years back …
we’re now shrinking

32
“For me 50,000 new customers need just 1 server”

Jack Ma (Alibaba) to Walmart – Dave Gledhill to Jack Ma –

“If you want 10,000 new customers, you have to build “You need 2 servers for 10,000 new customers …
a new warehouse, hire people … for me? 2 servers.” For me 50,000 new customers need just 1 server”

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*Image source: Forbes
Dramatic reduction in System Incidences, despite 166% increase
in Operating Systems

8,000

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7,000

6,000
71% reduction in
5,000 System Incidences
(2010-2017 YTD)
+166%4,000 -71%
18

3,000

2,000

1,000

0 8
2010 - 11 2012 - 13 2014 - 15 2016 - 17 YTD

Total No. of Operating Systems Monthly Avg. of System Incidences


34
The DBS Security Recipe … This is where our focus is now

8
Behavioural Biometrics
Predictive Soft Token – SG &
ID Retail 1 7
Soft Token –
“Frictionless” IN Retail, SG Corporate
User Behavioural Secure
controls, forward
2 Analytics Messaging
looking to threat
Role-based matrix and Privileged Database Deception 3
trends toxic access detection Employee Soft monitoring Technologies Targeted Attack
Token
Simulation
NextGen Endpoint 4
Security 5
24x7 SOC, Increase Ever Ready SOC
Intelligence Feeds Annual Phishing Assessment –
Annual Phishing Assessment
Proactive Gamified
From Generic to Targeted to
Trusted Sender
– Outsourced Partners

Less prominent and ISCBT 9


more pre-emptive Security Awareness
Security Awareness
Security Awareness Email
Posters / Stickers
controls Email Blasts Blast
Establish SOC
Traditional
ISCBT
One-Stop ID Portal
mChallenge ATM HDD
Centralised ID hub Encryption
Centralised Password

Preventive Vault
Endpoint Security – RaR, Transaction Signing
ATM Application
Intrusive controls, Disable USB, NAC Whitelisting
reactive to
business/regulatory
Hardware Token
requirements SMS OTP

Pre 2014 2014 - 2016 2017 & Beyond 35 35


DBS’ Technology Spend – Flat total spend in Phase 2
Shift happening from Operate to Build
11.5
10.9
Total Income

9.9 1.1 1.1 Total Income


1.1 (Forecast)
1.0
1.0

0.4 0.4
0.3 0.5
0.5

Build
Operate

0.7 0.7 0.6 0.6


0.5

2014 2015 2016 2017 2018


All figures are in S$ bn

Operate: Includes all BAU and Production application support, data centre, network, hardware, data security/cybersecurity,
laptop/desktop, maintenance fee for licence, tokens, POS peripherals and impairment cost 36
Build: Consists of IT development resources for IT Initiatives and Enhancements, depreciation and new licence cost
Well on track to deliver the Gandalf technology transformation
targets, and focus even more on building for digital

✓ Core banking systems – built ✓ Building digital channels and connectivity

✓ Capacity issues – addressed ✓ Developing digibank platform

✓ New platforms for new business – built ✓ Building next gen infrastructure and network

✓ Gen 1 Cloud journey – initiated ✓ Starting the “GanDalf” Cloud journey

12%
29%

56%

88%
71%

44%

Y2010 Y2014 F2017


Building Core Building Digital
(1) Data above excludes Lantern integration expense in 2017
(2) Building Core: Includes all IT Initiatives for building core capabilities, platform, infrastructure, external regulatory demands and refresh of applications
(3) Building Digital: Includes building new electronic channels, data analytics, big data, digital customer journey, ecosystems and APIs
37
Gandalf Transformation Targets by 2018

Become Cloud Increase Build for Data-driven Business Benefits


Native Release APIs and Culture, Analytics-
Cadence 10x Performance led Customer ▪ Cost efficiency
Science, ▪ Resilience
Instrumentation ▪ Time-to-Market
and
▪ Ability to extend to
Experimentation
ecosystems
Reduced Cost. Reduced Customer Centric. Customer Centric ▪ Ability to experiment
Improved Resilience Time-to-Market Extending to for improved
and Scalability Ecosystems customer experience

Investing in People and Skills

38
* Benefits / direct impact
Visit our Gandalf
booth to get the
To introduce changes to production, code needs to be… full experience!

Written Scanned Built

Automate Automate

Manual Automate Manual Automate Manual Automate

Tested and
verified
Manual Manual

Manual Automate DEVELOPMENT PRODUCTION


ENVIRONMENT ENVIRONMENT

Deployed in
different
environments

Manual Automate
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Enterprise DevOps Platform - First we had to build complete automation pipeline

Visit our
Visit our
Visit our
iWealth booth
Gandalf
Gandalf
to get the booth
Tech
full boothto get
40
to get the full
the full experience!
experience!
experience!
Aggressive automation has enabled us to move much faster and
increase efficiency

DevOps: % of automated application releases

100%
Cadence – No. of monthly deployments
100%
2014 2017

7.5x 7.5X

Volume of automated test executions

10x 10X
2014 2017

2014 2017
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A revolutionary new offering

Entered into new markets


– with lots of unknowns

We needed to move fast

And have the ability to do


weekly releases
42
Gandalf Transformation Targets by 2018

Become Cloud Increase Build for Data-driven Business Benefits


Native Release APIs and Culture, Analytics-
Cadence 10x Performance led Customer ▪ Cost efficiency
Science, ▪ Resilience
Instrumentation ▪ Time-to-Market
and
▪ Ability to extend to
Experimentation
ecosystems
Reduced Cost. Reduced Customer Centric. Customer Centric ▪ Ability to experiment
Improved Resilience Time-to-Market Extending to for improved
and Scalability Ecosystems customer experience

Investing in People and Skills

43
* Benefits / direct impact
Remember the API strategy – Enabling us to massively scale
… with ecosystem partners through APIs?

44
Visit our Tally
booth to get
Towards Making Banking Invisible … through APIs the full
experience!

✓ 8 million SMEs

✓ 30,000 salespersons

✓ DBS Inside

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How could we do this at scale?

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Thinking of Banking as a Solar System, we can’t do it all alone

Make banking ‘invisible’


(1) My Everyday Life & Goals
My Utilities My Pension

My Entertainment My Child’s Education


(2) My Finance
Cards
CASA TD

My Shopping My Car
Payments Insurance
(3) My Way

Loans Investments
Mortgages

My Travel My Wedding

My Health
My House
My Transport My Education

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So, we needed to set up a platform…

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… through which our partners can come and connect

OPEN API STRATEGY

REQUEST

API

Your App DATA Their App

... a standard way for one application to interface with


another to get access to its data and / or functionality

49
Visit our
We launched the world’s largest banking API platform APIs booth to
find out more!
in early November 2017

150+ 50+
Live APIs Live
partners

50
Gandalf Transformation Targets by 2018

Become Cloud Increase Build for Data-driven Business Benefits


Native Release APIs and Culture, Analytics-
Cadence 10x Performance led Customer ▪ Cost efficiency
Science, ▪ Resilience
Instrumentation ▪ Time-to-Market
and
▪ Ability to extend to
Experimentation
ecosystems
Reduced Cost. Reduced Customer Centric. Customer Centric ▪ Ability to experiment
Improved Resilience Time-to-Market Extending to for improved
and Scalability Ecosystems customer experience

Investing in People and Skills

51
* Benefits / direct impact
EMBED OURSELVES TRANSFORM INTO A
IN CUSTOMER 22,000 PERSON
JOURNEYS START-UP

BE DIGITAL TO THE CORE

Move from being


product-focused to
customer-centric

52
We were at rock bottom with our Customer Experience scores in 2009…

2009

Survey Ranking

53
* Source: CSISG Scores (SMU ISES results)
Incremental improvements were made through RED programme,
PIEs, Lean IT, and so forth

54
And we were able to drive substantial productivity
saves for customers, as well as employees

Customer Service Internal productivity

250 1
million customer million employee
hours saved hours saved

Also saving customer hours now ;)

55
These initiatives drove us to hit the top of the chart in Customer Experience

2013

Survey Ranking

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* Source: CSISG Scores (SMU ISES results)
Making Banking Invisible

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Customer Journey
Transaction Journey

59
What is….

…1 less retained
card worth?
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Card Retained

82%
61
Employee Journeys
250 Customer Journeys

62
World’s first in-school wearable tech and
POSB Smart Buddy – Journey thinking at work savings programme for children

63
Cash from parents’ perspective …

Transaction Journey Customer Journey

We want to eliminate cash Different perspective on cash

Discover Define Develop Deliver


64
Visit our POSB
Smart Buddy booth
POSB Smart Buddy was born … to have the full
experience!

A contactless payments ecosystem to cultivate sensible savings and spending


habits among young students in an interactive, engaging manner !

65
EMBED OURSELVES TRANSFORM INTO A
IN CUSTOMER 22,000 PERSON
JOURNEYS START-UP

BE DIGITAL TO THE CORE

Strengthen our people


and culture

66
What makes a 22,000 start-up?

Customer Take Risk & Be a Learning


Data-Driven Agile
Obsessed Experiment Organisation

67
What makes a 22,000 start-up?

Customer Take Risk & Be a Learning


Data-Driven Agile
Obsessed Experiment Organisation

68
Visit our CYCLE
Where data and customer insights meet… booth to have the
full experience!
that’s where the magic happens

Where the
Data magic Customer
happens

69
Visit our ATM booth
We have the highest velocity ATMs in the world… to have the full
experience!
how do we stop them from going “cash-out”?

Average time between cash-outs


“Highest velocity in the world” *
▪ 2010  3 months
20,000 transactions per month per machine
▪ 2017  55 years
70

* Source: ATMIA 2014


Predicting when a salesperson is going to leave

Raw data Ensemble

Training Data RM Revenue


- Number of trainings - RM’s monthly
attended revenue dollar in
- Days of training first 8 months
Business Impact:
- Mandatory / Non-
mandatory

Branch details Leave Pattern


predictive accuracy
- Branch location - In initial months
- Over several
consecutive
months

71
Visit our Future of
Auditing booth to
Predicting which branch will have audit issues have the full
experience!

Raw data Ensemble Business Impact:


Transaction Data
- Deposits
- Withdrawals
- Product purchases
- Non-financials Branch
Data
Branch Service
Health Check data
- Quarters since last BHC
- Number of High, Medium and Low
findings by BHC

HR Data
- New Hire
- Resignees
- Headcounts
- Span of control

Risk Events
- Group Audit findings
- Risk findings in control self
assessments.

Customer complaints IES Prestigious


Engineering
Cash discrepancy
Achievement Award 2015

72
What makes a 22,000 start-up?

Customer Take Risk & Be a Learning


Data-Driven Agile
Obsessed Experiment Organisation

73
14,800 bank staff engaged in innovation programs

DIGITAL MINDSET
IMAGINARIUMS UNI.CORN STARTUP XCHANGE
HACKATHON

IDEA VAULT HOTSPOT DIGITAL IMMERSIONS API PARTNERS

STRATEGY WORKSHOP FINTECH ASSESSMENTS CUSTOMER JOURNEYS MAKERS’ WORKSHOP

DAILY
INNOVATION
API HACKTHATHONS INNOVATION COMMUNITY EVENTS
BACKYARD
BRIEFING

74
We got our people to work with industry partners 30+ Biz Challenges Participants in
100+ Start-ups introduced 500+ community events
and start-ups to develop innovative mindsets

Corporate Start-ups / SMEs

Universities Government Regional


AND
MORE

75
We set a target for ourselves… far exceeded that!

1000
Experiments

76
What makes a 22,000 start-up?

Customer Take Risk & Be a Learning


Data-Driven Agile
Obsessed Experiment Organisation

77
Business-led Agile… It’s all about people!

Agile@Work Wonderwalls Across


geographies

78
The way we work …

DBS Singapore DBS Group Audit

DBS Asia Hub 2, Hyderabad


79
Designed to define a 22k collaborative culture
What makes a 22,000 start-up?

Customer Take Risk & Be a Learning


Data-Driven Agile
Obsessed Experiment Organisation

80
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*Image source: LinkedIn
Learning from Amazon… Starting with a press release

FINANCE TIMES
Subscribe

May 2020

“Continuous learning
embedded into day to day life…”
“Multiple channels…”
“Curiosity and self-led learning…”

“Byte size, on the go…” “Mobile and social learning


using technology…”

82
Learning in different ways across the region

Operations
Back to Spoke Lunch Tech Boot
Transformation Yammer Rookie Projects Transformers Gandalf Scholars
School Hub Exchange & Learn Camp
Program

Trade Learning to be Weekly Learning AWS Tech Mobile App


DBS Learn Theme Weeks CalxTalk Series
Academy Gandalf Program Forum Training Savvy Training

Flipped Learning
Super Heroes Labs Pass it on Learning Day eAmazing Race Smartie Experts IBGOHack
Classroom Groupies

Tech Design Agile Coach the Horizon Analytics


Speaker Series Learning Hour Reading Club Lynda
Forum Coach Classes Academy
431

Gamified Sandbox Community Based Job


Evangelists PechaKucha Mackathon Immersion Pop Up Classes
Learning Learning Learning Shadowing

83
Peer to Peer Learning Experiential Learning Ritual based Learning Self-paced Learning Classroom Learning
Learn and Teach Back

84
Transforming into Digital Bankers with gamified learning

Learning Catalogue Lynda Course My Learning My Groups My CPD Hours


Catalogue

85
Gandalf Technology and Culture Transformation
Moving from legacy company to tech company. Creating competitive advantage.

1 Gandalf Tech Transformation Systematic multi-year effort to streamline tech infrastructure


has enabled us to rapidly adopt digital technologies and build
sustainable competitive advantage

2 Culture Transformation Digital technology combined with customer focus and culture
transformation improve market share through superior
customer experience and create new markets through
ecosystems

3 Tech-driven business Accelerated income growth achieved with low marginal costs
as a result of scale, speed and efficiency
86
Being the in

87
Executing the digital strategy

Dave Gledhill
Chief Information Officer

17 November 2017

The presentations contain future-oriented statements, including statements regarding the


Group’s vision and growth strategy in the light of anticipated trends as well as economic
and market conditions. Such statements necessarily involve risks and uncertainties, 88
which may cause actual performance in future periods to differ from projections.