What has been the huge digital transition in HSBC as a banking institution in terms of technology outlook and digital transformation?
As a 150 year old banking institution, there has been a huge realization within HSBC global that customer behavior is changing rapidly along with the customer demographics. Our overall proposition has been around connectedness, since we are a global bank, with operations across different countries. We embarked on understanding the customer habits with vigour across different geographies – for instance, if we see, Mexico is still largely a cash-handling, cash-led economy, which means we need to focus on ATMs there. Some of the other parts of the world are exactly opposite. Customer context is so critical.
Driving digital through use of modern technologies (5 pillars)
Fostering and nurturing women architects (diversity drive)
The second part is the regulatory aspect – and the good thing here is that most regulators are learning along with us, and are actually influencing policy very proactively. Thirdly, the most heartening aspect that we are witnessing internally in the last 24 months is that technology is at the center of our decisions. We are going through a learning exercise internally.
I believe digital extends to everything – culture, values, change and mind-set, and is not merely restricted to user or customer experience, or the look and feel of a website, clicks, traffic etc. It is a 360 degree experience, unlike the one dimensional view held by most service providers, who we see are increasingly unable to serve banks such as ours.
How has HSBC Technology set the pace for digital transformation for the bank?
As a technology function, change starts with us. The HSBC technology function in itself is around 40,000 people globally (employees and contractors).
One of my charters is to change the way we look at technology. This includes adopting Agile DevOps as a standard methodology and in changing our proximity to the marketplace – speed being a key aspect. That is the huge shift – thinking digital is critical. We have gone on this journey – sensitizing and educating our 40,000 people about the new tools – we have chosen around 100 tools as our focus. These are customized – to deliver software.
It is imperative to create a top notch engineering-centric, self- learning organization and that is exactly what HSBC Technology has set out to do.
Global CIO–Retail Banking and Wealth Management, HSBC
We have simplified organization structure in order to make multiple team collaborations easy. Last year, we delivered 100 digital features; this year, till date, we have already delivered 60 across the world, the target being to deliver 200 – and we have measurable business outcomes attached to these – which we review and discuss every month.
The interesting part here is, we don’t call the old “legacy” – we call it heritage – something we are proud of. As we often see, the problem with two-speed IT and bi-modal IT is that it immediately disenfranchises a whole set of people – the set that knows the industry, values its relationship with the organization and comes with rich experience. So, we have taken a very different route to digital – our approach being that we leave the field open for anyone to come forward and adopt change. Core banking is a classic example of a heritage area where we have actually effected change with the right change management approach – we offered new tools that we have developed ourselves - to be learnt and adopted. Such techniques are working for other older systems, applications and services too. As a result, the whole organization embraces this change. When customer experience remains consistent, we work backwards molding the people who drive the experience.
Recently, at the NASSCOM Leadership Forum (NLF), you had outlined the approach to digital at HSBC as being centered on 5 pillars. What are these?
We centered our approach around five pillars, as I mentioned. These five pillars existed before, the difference being that we have over the last 24 months, figured out how to connect these and make them work at scale.
We are advocating these and saying these are the ones we have to look at. Firstly, we are looking at the API economy – connecting various product systems and channels in a manner that is easy to use.
Earlier, the product system was held supreme. There is a paradigm shift, with the channel systems now taking center stage, and that is the underlying thread of the APIs movement. We have developed several 100s of APIs over the last 18 months in different countries and it is a key part of our digital shift – our view being if we cannot do this well, then we cannot move digital.
The problem with two-speed IT and bi-modal IT is that it immediately disenfranchises a whole set of people – the set that knows the industry, carries rich experience and values its relationship with the organization.
Global CIO–Retail Banking and Wealth Management, HSBC
Secondly, data strategy – banks have to build their own value-added differentiators – we are bringing modern technology thinking into the way we look at customer data by using biometrics, AI, ML, analytics. Again, our aim is to bring personalization and context into customer requirements, basis the relevant information we already have about the customer.
The other larger picture, higher end use of data is in financial crime. We have developed capabilities around identifying these using technology. Human intervention is near zero, unlike earlier when limited data points and huge reliance on human intervention made the scope of work around financial crime sluggish and constraining.
Thirdly, mobility is a huge focus area for HSBC Technology, given the focus on enhanced customer experience.
Fourthly, cloud computing, which allows you to use technology as you need it. Technology is an enabler and not a constraint to protect data, and its residency.
Lastly, we have a personal and corporate responsibility towards security – we have a significant cybersecurity program in the bank – from learning to tools to protect the bank from current and potential threats. We have an established framework, which we have customized for our needs, and is mapped across our technology function.
Elaborate a little about HSBC Technology operations in India.
We are about 13000 people (employees and contractors) in India – which also houses the largest global in-house center or what we call as the largest capability center within HSBC. In India, we do every aspect of technology for every aspect of business. We demonstrate highest levels of staff satisfaction. About 12-15 people own the responsibility of operations internally.
We have relooked our ODC strategy – since we realized it is a constraint to speed. We are one of the best examples of global distributed agile – interacting at speed with global teams across HSBC tech. Physical distance is going away and co-location is in.
Importantly, this is an engineering-centric profession, and has to remain so. Technologists have to be in touch with technology at the heart of their mission. Hence, superficial levels of hierarchies have been removed; it is expertise that matters.
We have about 700 people managing our India tech, which means each person would be managing around 20 people, and there is a program that runs this machinery. India is leading the way for HSBC global, and have been actively vocalizing these approaches and views in industry forums such as NASSCOM.
HSBC Technology is also quite vocal about its diversity policy. Elaborate.
Diversity is a significant focus and an integral part of the overall agenda.
We ran “Take2”, a program in which 600 women professionals from various experience levels came in as applicants, and of which 150 of these were selected and invited to the launch event. We had a fruitful discussion with them on what can be done to make it easier for them to come back to work post a sabbatical. We encourage our female technologists to be a part of the Grace Hopper Conference, India (GHCI), which is one of the largest annual hubs for women technologists. HSBC tech has a diversity head, who spearheads all these initiatives. One of my passions or missions is to see more women architects – and we are encouraging this through a program that calls for building architecture capabilities – and there has been a resounding subscription from the women workforce.
Diversity is a multi-dimensional piece – we are looking at these aspects in a holistic manner. On the CSR front, in Pune and Hyderabad, we inaugurated a facility for the visually challenged. We are also working with the Pune Council for area digital literacy.
Alongside using tech to enhance customer experience, democratization of reach – to less banked regions in the country and helping in reducing the cost of lending – continue to be prime objectives of Indian banks, both public and private. What is HSBC’s view around this, being a multi-geography, foreign bank?
For the segments we serve, we do help to democratize reach through technology, and that has been happening across HSBC globe. No society can be immune to the effects of that. We do not serve all segments – that is not our core mission. HSBC tech strives to be a technology enabler to the core business.
It is my professional mission that HSBC needs to be the leading bank in the world adopting technology powered by a best-in-class team. In order to achieve this, it is imperative to create a top notch engineering-centric, self- learning organization and that is exactly what we have set out to do.