Transform Your Bank’s Infrastructure with DevOps Efficiency
The banking industry is going through significant changes. Customer expectations are shifting as digital experiences become the norm. Emerging technologies like AI, blockchain, and cloud computing are opening new opportunities while also posing potential threats from new competitors.
At the same time, the banking infrastructure built decades ago needs to improve to keep pace. Legacy systems make changing and innovating difficult and expensive. Mergers and acquisitions have left many banks with fragmented systems complete with technical debt. Maintaining complex legacy infrastructure consumes a large portion of IT budgets.
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The Need for Agility and Innovation
The banking industry is experiencing significant changes, primarily due to shifting consumer expectations, emerging technologies, increased regulation, and the emergence of new competition from innovative fintech startups. Traditional banks are facing immense pressure to keep pace with these market forces and provide seamless digital experiences comparable to those provided by tech giants like Apple and Amazon. However, the legacy infrastructure of many traditional banks may make it challenging to respond quickly to these market pressures.
Most established banks rely on aging, siloed technology and processes that inhibit agility and speed to market. Core banking systems designed decades ago need more flexibility and integration with new channels and applications. Due to complex, manual processes, deploying new capabilities takes months. Fixing something or launching new features requires coordination across many IT teams and obsolete systems. This fragmented infrastructure leads to slow and inflexible development cycles that cannot keep pace with today’s rate of change.
Banks need help to bring innovative products and services to market swiftly. Lengthy development and testing processes delay launch initiatives. Developers save time piecing together disjointed systems versus focusing on coding differentiated solutions. Outdated ways of working hinder the ability to experiment, iterate quickly based on customer feedback, and continuously deliver value. As a result, banks need to catch up in meeting new customer expectations and keeping up with fintech competitors unencumbered by technical debt.
Agility and faster time to market are critical capabilities banks must build to remain competitive. However, achieving this is extremely difficult with complex, entrenched legacy systems and processes. Banks need transformative approaches like DevOps to unlock the innovation velocity and adaptability required for the new digital marketplace.
What is DevOps?
DevOps is a set of practices, tools, and culture that emphasizes collaboration between software developers and IT operations professionals to deliver faster and higher quality applications and services.
The core principles of DevOps include:
- Automation—Automating manual, repetitive processes like testing, infrastructure provisioning, deployment, etc., increases efficiency and reduces errors from manual work.
- Continuous Integration and Delivery: Building, testing, and releasing software in smaller increments versus infrequent big bang releases accelerates delivery and feedback.
- Infrastructure as Code – Managing infrastructure like code, enabling version control and testing. This increases reliability and reproducibility.
- Monitoring and Logging—Log all activity and monitor applications and infrastructure in real time. This provides visibility and helps identify issues.
- Collaboration – Breaking down silos between developers, operations, security, etc. Fostering cooperation and shared ownership leads to better outcomes.
The benefits of DevOps include:
- Faster time-to-market – New features and fixes can be developed and deployed much faster.
- Improved quality – Continuous testing and monitoring means bugs can be caught and fixed faster.
- Better security – Security is built-in, and vulnerabilities can be addressed rapidly.
- Higher efficiency – Automation and collaboration eliminate waste and enable teams to deliver more value.
- Enhanced innovation – Faster cycles and user feedback foster continuous innovation vs big bang releases.
In summary, DevOps is a transformational approach that breaks down barriers between teams to enable faster and higher quality delivery of software and services. The practices and culture of DevOps are critical enablers of business agility.
DevOps Impact on Banking
The adoption of banking DevOps delivers significant improvements in critical areas like customer experience, time-to-market, and security.
Customer Experience
DevOps allows banks to release new features and updates to customer-facing applications rapidly. This improves the user experience and will enable banks to respond faster to customer needs and feedback. Banks can take an iterative approach to application development, releasing updates as small batches rather than significant, infrequent releases. This incremental delivery model gives customers new capabilities faster.
DevOps also enables better integration between customer touchpoints like web, mobile, ATM, and in-branch. With continuous integration and delivery, updates can be more coordinated across channels, creating a seamless customer journey across interactions.
Time-to-Market
With DevOps, new product and service development lifecycles can be drastically shortened. Automation, collaboration, and new architectural approaches like microservices allow banks to develop and release new offerings in weeks or months rather than 9-12 months.
This speed and agility is critical for banks to remain competitive, especially with fintech disruptors rapidly innovating in payments, lending, and investing. Banks embracing DevOps principles can match the velocity of startups.
Security
Some may see more frequent releases as a security risk, but DevOps enhances security through automation and collaboration between security teams and developers. Security is shifted left in the process and built into applications.
With infrastructure-as-code and policy-as-code, configuration standards are codified. Security scanning and testing are automated. Vulnerabilities can be identified and remediated quickly through rapid feedback loops. SecOps and DevOps work together, resulting in more secure banking applications.
DevOps Best Practices for Banking
Banks need to embrace critical cultural and technological best practices to adopt DevOps.
Culture Change
- Break down silos between development, operations, security, and other teams. Encourage collaboration, shared goals, and accountability across the entire organization.
- Shift to a customer-focused mindset. Continually get feedback from customers and iterate quickly to deliver more value faster.
- Support autonomy, trust, and responsibility within teams. Allow teams to choose their tools and workflows.
- Promote a blameless culture focused on learning and improvement when issues arise.
Cross-Functional Teams
- Organize interdisciplinary teams with expertise across development, operations, security, testing, and other functions. Avoid isolated specialty teams.
- Ensure each team owns an end-to-end service and is empowered to drive changes. This increases ownership and accelerates delivery.
Toolchain Integration
- Automate and integrate tools into a coordinated toolchain for the entire software lifecycle. This may include version control, building servers, automated testing, infrastructure management, monitoring, etc.
- Standardize tools and processes across teams to enable collaboration. Custom solutions inhibit velocity.
- Prioritize easy integration between tools over individual tool capabilities. The toolchain is more important than any single tool.
- Leverage APIs, configuration management, and orchestration to connect tools and create an automated, low-friction pipeline.
Banks can overcome legacy constraints and deliver innovation faster by embracing a collaborative culture, cross-functional teams, and integrated toolchains. DevOps sets the foundation for competing in the digital age.
Case Studies and Examples
DevOps adoption is gaining momentum within the banking industry as institutions seek to remain competitive and meet rising customer expectations. Here are some examples of significant banks finding success with DevOps initiatives:
- Capital One is a pioneer in leveraging public cloud and DevOps methodologies. They have adopted a “cloud-first” strategy and rely on AWS for their infrastructure. Capital One has created a highly automated software delivery pipeline, allowing developers to rapidly go from code to production. This has accelerated their time-to-market for new products.
- JPMorgan Chase has invested heavily in modernizing their architecture and systems. They have trained thousands of developers on agile and DevOps best practices. JPMorgan Chase built an automated platform called Jupiter to orchestrate network changes and deployments across their entire enterprise. Jupiter has increased their deployment speed and stability.
- Barclays has implemented a DevOps model across critical applications, such as its trading platforms. They use techniques like continuous integration and infrastructure-as-code. Barclays has increased deployment frequency from twice yearly to over a hundred times per day. Faster deployments reduce time to market and risk.
- Deutsche Bank credits a DevOps approach with reducing infrastructure outages by 90% over three years. They have also focused on culture change, adopting lean and agile principles across their departments. Deutsche Bank also created self-service deployment pipelines that enable faster application delivery.
- BBVA built an API platform using AWS to increase the bank’s agility. They have adopted infrastructure-as-code and containers run on Kubernetes to support rapid deployment. BBVA’s API platform provides reusable services that accelerate their app development timeline.
These examples demonstrate central banks’ critical benefits from embracing DevOps – improved deployment velocity, reliability, and innovation. As DevOps matures within the finance industry, it is emerging as a critical strategy for digital transformation.
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