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Thinking in weeks, developing in days, and deploying in minutes
As companies continue their quest for digital transformation and face uncertainty in the business environment, especially in current times, the ability to react in an agile manner to address customers’ needs is increasingly apparent. It is a proven strategy cited by industry research and consulting firms, and has delivered results for Macquarie’s Banking and Financial Services Group (BFS), as it modernizes its legacy banking systems.
Financial institutions are particularly attuned towards facing the challenges in revamping in-place architecture, given the extent to which legacy technology continues to support processes - and are also driven by customer expectations that display an ever-increasing demand for more and higher quality services on a variety of devices. Meeting these needs is not possible without deploying a strategy calling upon a three pronged approach encompassing three pillars for change: cultural, technological, and business process modernization. As cited in a recent Harvard Business Review study, APAC executives have especially demonstrated ability to overcome the difficulties of change relative to their global counterparts, with 80% ranking cultural change and technology modernization of equal importance for digital transformation. Further detail reveals 40% of APAC executives are quickly deploying new applications to market, compared to only 23% of executives in the rest of the world.
One bank that has risen to these challenges is Australia’s Macquarie Bank. It has enhanced its ability compared to some of the largest banks in the world in terms of the speed at which it can move application feature changes into production - and ultimately to their end customers - according to an IDC paper, "Macquarie Digital Banking Proves the Promise of a Container Platform."
Luis Uguina, Chief Digital Officer of the digital-only, digital-first bank, explains that the focus is on having its platform team "thinking in weeks, developing in days, and moving into production in minutes." The pace at which it moves applications from the lab environment to beta to production has already been reduced from six to seven hours in 2016, to four to five minutes now. Business and product owners now request feature and functionality changes for their solutions with the confidence that they’ll be able to bring them to market more quickly.
Further illustrating its potential in accelerating development, BFS has the capability to test and implement rapidly, and can conduct feature deployments of its personal financial management app about 40 times per day in its full-production lab environment. The team has the ability to make changes and deploy new features quickly to its customer - a feature especially compelling where emphasis is on a more digital approach.
Code is usually released for beta testing every few weeks - although sometimes daily - and full production deployment to its entire customer base happens very quickly. BFS’ ability to keep releases steadily propagating through these stages attests to the efficiency of their platform-as-a-service (PaaS) approach to application delivery - which highlights the use of container technologies supporting development across multiple environments. Because of this, the bank can run different versions of services simultaneously, displaying the agility necessary to respond to customer needs in a compressed time frame., e.g., a full production release to customers may be going live, with enhancements available immediately, as beta tests of application feature updates are in progress. In addition, developers can be freed to continue working on upcoming functionality as this is taking place.
Embracing microservices, cloud, and container technologies
For BFS, the gains it has realized more than justifies its decision to presently allocate more than 70% of its workloads on containers.
The ability to achieve their present day competitive advantage through rapidly implemented business functionality, originated in 2017 when BFS decided to utilize benefits associated with a PaaS solution. It opted for Red Hat OpenShift Container Platform, the enterprise-grade Kubernetes distribution, to bring its applications and services to the cloud. This shift involved strategic planning for re-architecting key customer-facing apps and those in need of continuous improvement, with the bank determining to take an iterative approach to this modernization. The bank deconstructed underlying functionality into container-based microservices which underpin their current reconfigured products and services.
BFS pairs its use of OpenShift Container Platform with its application building support for managing the PaaS solution, enabling automating, provisioning, and scaling applications. By significantly reducing human interaction, development-to-production productivity has dramatically improved, with gains of up to 50 percent.
Utilizing containers has been a game-changer for BFS. They have extended the advantage offered by their Red Hat container approach to include beta-testing new functionality by placing 10% of traffic into a container, and, after determining results in the isolated environment, confidently rolling out the same functionality to their entire customer base. "No company in the world can do that without containers, no company in the world can have this agility if you don’t use this technology," Uguina said.
BFS has supplemented their microservices transformation strategy to business banking and wealth management applications as well, an expansion of its PaaS to more than 485 applications to date. Looking ahead, the bank envisions supporting up to 500 PaaS applications and continuing its container strategy to reach a goal of 100% of its applications on the public cloud for scale, speed, and business agility by 2022.
About the author
Arvind Swami has been part of the FSI community, in various regional and global roles, for the past 20 years. He has worked for Banking platform vendors like Temenos, Oracle Financial Services and SAP. In his banking platform journey, having been involved in transformational engagements globally, he has seen that the architectures surrounding these core platforms.