Spend to Save – the cost of Enterprise Architectures, SOA and AGILE implementation
Many financial services companies feel that ‘IT is not a core competency’ although technology underpins nearly everything we do. In a number of the ‘new world’ propositions such as wraps, technology is a differentiator as well as an enabler.
This is a time of great change in our industry with the advent of new products, services and business models with an ever increasing focus on collaborative working with a range of business partners.
Cost pressures have also been growing continually, being stretched to the full under the scrutiny of the credit crunch.
As a result there has never been a time where the ability to have a flexible technical architecture provided with the optimum return on investment has been so vital.
Three key trends have come into play to support this push:
- Enterprise architectures
- SOA technologies
- AGILE implementation techniques
Are they fulfilling their promise?
The answer is – it is too early to tell. Many companies profess that they are gaining rapid decreases in development timescales, increases in quality and re-use of deployment and improved fit to business needs. Winchester White’s experience of such programmes bears this out with re-use of services up to 50% across projects and increased deployment times of over 60%.
However, when the figures are analysed these programmes have not yet recovered the initial costs of investment or enabled the ‘retirement’ of legacy solutions that affect the cost model of the IT area so dramatically.
Data collated over the past 2 – 3 years support the underlying technology approaches and with IT forming such a significant part of any company’s budgets companies should consider these trends. What is most important though?
The first thing is to understand the business model that the company is following and to ensure that any change in the IT strategy aligns to this model.
Many think that the change to an enterprise wide, service based architecture stacks up in its own right as bringing reduced IT costs. However, with a significant investment required in underlying technology, new skills and development tools there is a risk that the return on investment will be delayed for some time unless development is carried out to provide strategic business benefit rather than on tactical projects.
The second thing is to ensure that any programme has sufficient coverage to define the strategic target architecture while testing the detail of the design and rapidly delivering benefits to retain momentum. This means that activities should follow best practice introducing new skills and methodologies in terms of AGILE service based architectures avoiding being purist in approach using injections of financial services domain expertise to ensure results and rapid delivery.
Technology is finally catching up with the innovation challenges that the business teams can throw at it. However, we need to proceed with caution as it can come at a high financial cost.
Please contact Tracy Shadbolt on 01256 363000 or tshadbolt@winchesterwhite.co.uk for a discussion on how we might meet your particular needs.