NAB’s technology transformation
NAB’s delivery on its total technology transformation strategy and trends in technology and technology recruitment was the focus of NAB CIO David Boyle’s speech to the FST Media Sydney Banking Conference on Thursday 6 November.
**Check against delivery**
Good morning everyone, great to be back here at FST.
I’m here today after only nine months with the NAB team. It’s definitely been an incredibly busy and exciting nine months, both for the NAB group overall, as well as for our technology team. But it’s also been a period of rapid change for me personally.
To do this role Nicole and I chose to move from Sydney to Melbourne which for a big family like ours, with six of us and a dog, is quite an undertaking. Moving schools, sports clubs, finding a place to live that’s not too far from the schools, figuring out the public transport system etc. When I compare it to our last move between cities, exactly a decade earlier, it’s easy to see just how much things change through digitising the way we live.
Take just getting to school. How do two adults arrive in a city 48hrs before school starts and get four children to three campuses at exactly the right time? Well you put one adult with each of the two youngest and you give the older two a hand-me-down iPhone and turn on find my iPhone so you know they’re on the right path.
Last time I moved cities we only had smaller children with the oldest not yet playing team sport. I shudder to imagine what the last nine months of weekend sporting fixtures would have been like without the expat parents’ life saver – satellite navigation. You know it’s only really been the last month or so that I’ve started to feel like I might even be turning into a Melburnian, which I realised when I hit a major milestone in my own personal development. I started to choose alternative routes to those suggested by the sat nav.
OK now there’s one other important Melbourne cliche I must deal to before we move on… the matter of which AFL team I support. This might seem like a simple and immaterial decision for many, but remember NAB sponsors the AFL as well as Auskick and I was starting from a position of hardly being able to spell AFL and was still mightily relieved that no one had discovered this during the interview process.
During the first six weeks I must have been asked this seemingly innocuous but more than a little bit probing question on a daily basis: “What AFL team do you follow?”. It was as if to say “we’re completely open to whatever choice you make but for occupational health and safety reasons it’ll need to be recorded on the HR system just the same, especially if you choose Collingwood”. So for the record, after much consideration, much encouragement, and even watching a few games, I decided to go with the city of birthplace, Sydney. I’ve also now been to my first AFL game, the grand final but let’s skip that one shall we….
Last week you may have seen our new CEO Andrew Thorburn speak candidly about our results and the direction we will take under his leadership. And while he was really clear about our need to address areas of our portfolio, the result also highlighted the strength of the Australian and New Zealand franchises.
Specifically I’m sure you are aware of NAB’s market leading position in Business Banking and it’s well-known that NAB is Australia’s leading Business Bank. But Personal Banking is also going from strength to strength – with 19 consecutive quarters of above system growth. And it’s the Personal Bank that is about to get a significant boost from the upcoming NextGen deployment, which Andrew Thorburn also spent quite a bit of time covering last week.
For my team and me, it’s an exciting time in technology as the organisation tilts its strategy towards the core Australia and New Zealand franchises that we support and are passionate about. I thought it worthwhile to touch on some of the major technology achievements and deliveries over the last 12 months.
Delivering NAB’s digital banking platform
Let’s start with NAB’s core banking program and the impact it is having on our frontline and on the customer experience. This is a picture of a NAB Banker Aaron Jenson and his client Allison, enjoying another of Melbourne’s and my favourite pastimes, drinking coffee. Aaron was one of the first bankers to use the new NAB View platform, which is in the process of rolling out to 4500 bankers nationally. He’s actually sitting in the Village in 700 Bourke St Melbourne, our hugely popular banking and collaboration space for small business customers. It’s worth a visit if you haven’t already seen it.
As you might have read in the Australian Financial Review today, NAB View is a true single customer view and Customer Relationship Management platform, constructed using the Oracle Customer Hub by our NextGen program.
So why is NAB View so important? For no other reason than relationships being at the heart of our business banking model, and therefore our bankers need a vital tool to support and enable the way they want to interact with the client. That is, seeing all the client’s needs from personal banking, to business banking and even wealth. The NAB View team has aggregated more than 12 million customer-account relationships for about 99% of all customers in the Australian region.
The NAB View platform creates the foundations for the bank to be, in a technology sense, truly centred on the customer, not the account.
This latest NAB View delivery builds on the two previous major NextGen milestones being: 1). the delivery of our new core servicing platform and the launch of the award winning digital bank UBank with some 400,000 accounts; and
2). the new finance, risk and treasury platform supporting securitisation, a new general ledger, and funds transfer pricing.
This year we have also brought our new credit risk engine online using this platform – which meant we could decommission 37 old legacy servers.
The true power of the end-to-end core platform is taking shape, with integration throughout each application layer.
At this point in the journey we have delivered three out of the four fundamental components of our digital banking platform: core servicing now visible in UBank, the Integrated Analytics Platform for finance, risk and treasury as well as the Customer Hub underpinning NAB View.
This leaves one major component still to deliver which the team, under the leadership of my colleague Steve Collier, is now solely focused on, landing origination on the platform. Once this is complete, our platform will have reached a tipping point with the full end-to-end stack deployed and we will have great choice about how to use the platform moving forward.
It goes without saying that we at NAB have learned a lot throughout the NextGen program. It has been a challenge to the organisation but has already delivered significant value and benefits. The decision to embark on a core replacement program has been validated.
As was outlined last week, once we reach this tipping point, our plan is to shift to smaller, more frequent drops of capability. We are moving from a marathon to sprints in terms of projects delivering benefits faster. I expect to see our portfolio of sprints to be a mix of launching new products and services as well as migrating existing accounts and then decommissioning legacy platforms.
Total transformation agenda
While our digital banking program sits at the heart of our transformation agenda, it’s important to remember that NAB has in parallel been overhauling its total technology environment.
We’ve upgraded our networks through our partnership with Telstra, we’ve modernised our voice platforms, we’re half way through bringing our entire desktop fleet up to currency with Microsoft and IBM and we’ve just finished a major transformation of our printing services that has reduced the number of printers across the country by over 3500 as well as delivering a monthly reduction in paper usage of 1.4 million sheets.
These changes are also critical to our transformation, because as the old saying goes “You’re only as strong as your weakest link” or in the case of technology “We’re only as agile as the slowest component”.
This is our new data centre. I know this is probably one of the few audiences in Australia that might find this image exciting so I am going to unleash the geek a little here. Indulge me.
The centre is world-leading in terms of energy consumption. We’re now running at less than half the power consumption for each business application we move into this new facility relative to the old. It’s the first Australian facility to achieve the US Green Building Council Platinum Certification – an award specific to data centres.
Power and buildings are important but what is more interesting is what’s happening inside these walls to drive the customer experience.
This centre holds our new Private Cloud – our infrastructure on demand capability that NAB has constructed with IBM. While the promise of lower cost and more agile cloud-based infrastructure has become a reality for those applications engineered to take advantage of the highly standardised and commoditised offerings readily available, the challenge is to capture those same benefits across the larger suite of legacy applications we support.
This is the big prize in the short to medium term. Our private cloud is all about supporting the entire application landscape, not just the more modern applications that can run on standardised intel. For NAB’s entire technology landscape to be agile we need to be able to enhance and deliver change to all our applications more rapidly and our Private platform is delivering exactly that by introducing the sort of tooling and automation that is normally associated with public cloud offerings like AWS.
Some of the key applications already running on the Private Cloud include NAB Connect, our internet banking offering for business as well as our internal intranet.
So in addition to the private cloud it’s worth noting that NAB is also making great strides to incorporate public cloud offerings into our overall IT landscape.
Through our partnership with Amazon Web Services Adobe and Akamai, we’ve moved all our brochure-ware websites to the Public Cloud. It is my understanding that NAB was the first Australian major bank to go live with Akamai and make use of their 5000 caching sites globally. For our customers the use of Amazon and Akamai has meant the speed of nab.com.au, mlc.com.au and ubank.com.au have all dramatically increased, for some use cases five times faster, regardless of where the customer happens to be around the world.
For our shareholders it’s better because we only pay for what we use and it reduces our infrastructure and network load for one of our highest volume applications traversing back to our data centres. Just as important though is the additional agility of this new platform we’ve constructed. It is now possible to do a number of intra-day changes, and this sort of ‘speed to value’ is a culture we’re building across our division.
So while speed of response times, efficiencies and agility are important, the experience on our platforms is actually much more apparent to our customers. This same digital team that moved all our brochure-ware to the cloud has also delivered over the last 12 months a huge upgrade of our internet banking platform for business, NAB Connect.
The features of NAB Connect that are the most impressive are the enhanced user interface designs and the new mobile interface built to just make it simpler for the customer, for example re-designing key processes to cut the number of clicks by more than half. Customers can now authorise payments from any screen; can create a new user in just 2 screens (down from 8); and it takes 2 clicks to print a statement (down from 5).
Our business customers are invariably time poor. Designing our services, like NAB Connect to make it easier for our customers is what it’s all about. NAB Connect is a great example of where the team is doing just that.
Building a successful team: diversity, innovation, and talent
This is a picture of one of my teams, led by General Manager Lisa Palma, taken from the top of our landmark building, 700 Bourke Street Melbourne.
When I came to NAB, the strength of the team was one of my standout first impressions from those early weeks. The passion for our customers was real. The team’s commitment and loyalty to NAB was born out of a strong connection to the organisation’s values to do the right thing. My role, with my senior colleagues was really to support and foster this culture. Let me touch briefly on three dimensions of the team and talent journey we are on…
We have deliberately focused on creating not only great opportunities and projects for people to work on but also ensuring we support any initiative that makes NAB an even better place to work.
The Women in Technology program contains a range of initiatives targeted at developing our pipeline of female talent already working at NAB. It also includes a series of initiatives to engage with the next generation of talent that is yet to join our team and rarely have a good understanding of what a career in technology is really like.
The program sponsors network events, runs a number of mentoring projects inside NAB and we present at a range of forums to encourage school and university students to consider careers in technology.
And very pleasingly we are seeing the results come through in our diversity measures. The percentage of our senior leadership population that is female has increased 10% in the past year.
And in Technology we have more female leaders in the more senior roles than we’ve ever had.
But we still have a long way to go.
This is a picture of Maria Frizziero who works in our NAB Wealth technology team and her daughter Alecia. They are a great example of the impact of our Women in Technology program in action.
Alecia, like many other teenagers across the country, thought that her mum’s job sounded rather, well, boring.
But, Alecia recently went to a ‘girls only’ technology career’s expo at Deakin University in Melbourne, which was sponsored by the NAB Women in Technology program.
When Alecia came home from the career’s expo that afternoon, Maria reported a completely new attitude on what a career in technology actually meant. Actually her exact words were:
“Mum I think I understand what you do now! And it doesn’t sound that boring after all”.
Ever since I’ve been trying to get my oldest two along to a similar event.
Women are still under represented in the technology sector, and we must continue to do more.
Gender is one element of NAB’s Diversity and Inclusion agenda. We know that financial services, and also technology are traditionally male dominated but we have also suffered from a lack of diversity more broadly.
If we are to be set up for success, we need a wide range of skills and capability in our organisation. This is particularly true in technology. The skills tech leaders need are no longer purely technical. We want business strategists, and stakeholder and leadership experts. And we want a diverse range of thinking and mindsets.
Ensuring we value different perspectives is not only good for our people, but in fact is very positive for our customers and shareholders. Challenging the status quo means we get better and better at delivery.
This is a photo of a recent Innovation Day session, where the team spent their time experimenting – outside of their day jobs.
Experiments are different to trials. We expect experiments to fail. Actually we want a number to fail because it means we’re pushing the right boundaries. But they do succeed as well, and often in unpredicted ways.
We talk a lot as a team about our goal of being ‘always on’ for customers, so at a recent iDay, the group experimented with a big data tool we had been using in one area to see what it can do for us more broadly. Smaller groups broke up to dive into our customers’ experiences across a range of segments, including all of our main digital channels, to see what lay under the data.
In one day, we had a number of initiatives identified that have had immediate impact on our services by solving common problems our bankers and customers feel.
Interestingly the majority of these initiatives have little or no cost but with tangible effects for customers. This is the power of our talent when we give them the freedom and flexibility to do what they love.
When I think back to the volume of change we’ve seen in the last decade since I last moved cities and I cast my mind forward to the volume of change we are likely to see in the next decade, I see only a mountain of interesting and exciting work for the technology team at NAB to deliver.
In fact I see a strong pipeline of the sort of interesting and challenging work I’ve personally enjoyed doing all my career delivering technology enabled change for banking and financial services customers. Yet I do wonder where all the talent is going to come from to do this work.
So this is the third area of focus for our team. Building a strong pipeline of talent.
We have a fight for talent on our hands. We need to focus on attracting talent because the banking and finance industry is among the main technology employers in Australia.
There is the growing challenge in attracting school leavers to study Information Technology at University.
Young adults can imagine a path from Law School to the courtroom, but not all can see the road from an IT degree to designing apps or new, innovative experiences across a range of sectors.
So why are enrolments dropping? And what are we as an industry doing about it? Why are the enrolments of female undergraduates dropping even faster than males? What else can we do as an industry to encourage more of our children to take up these careers?
So with that thought I might summarise…
In NAB’s recent results announcement Andrew Thorburn has flagged at tilt towards our core Australian and New Zealand franchises.
The Technology team at NAB is delivering significant transformation for these franchises, anchored around our core banking program, Digital and Infrastructure modernisation.
The technology team at NAB is passionate about being Always On for our customers, accelerating the pace of change to delivery speed to value and building a diverse and strong pipeline of talent to meet future demand.