Industry Focus Issue 02

ISSUE 02 | december 2012

industry focus A CNME supplement

Inside

banking special

consumerisation | NBAD | content management | cloud | mobility

SMARTER DOCUMENT IMAGING WITH KODAK

TRANSFORM DOCUMENTS INTO BUSINESS INSIGHT Kodak’s portfolio of solutions empowers organizations of all sizes to transform paper and electronic documents into business insight. Award-winning scanners and capture software. Industry-leading service and support. A growing array of professional services. It all adds up to having the solutions that make your insight take flight.

Make a change for the better. Kodak.com/go/DI For inquiries : Tel: +9714 3444910 E-mail: meaf-di@kodak.com

© Kodak, 2012. Kodak is a trademark. DoldeMedien_40_12

SCANNERS

SOFTWARE

SOLUTIONS

SERVICE & SUPPORT

PROFESSIONAL SERVICES

YELLOW CHANGES EVERYTHING

Contents

06

04 04

06

08

09

Banking on mobility GBM’s Director of Business Solutions, Seyed Golkar, gives his take on the Middle East banking industry, emphasising the importance in embracing the significant shift towards mobility, and protecting customers accordingly.

Virtual supremacy

In order to maintain its status as the leading bank in the UAE, the National Bank of Abu Dhabi (NBAD) recently underwent a major implementation to virtualise its head office and disaster recovery data centre.

Playing catch up

As a new year approaches, David Whitton, Cluster Manager, Enterprise and Document Imaging, MEA, Kodak, says Middle East banks must catch up with government institutions in the implementation of content management technologies.

09

Driving differentiation Banks in the region are broadening their IT investments from pure core banking systems to more advanced solutions that drive differentiation via increased operational agility and improved customer intimacy. Stephen Fernandes, AVP and Head of Middle East, Cognizant, explains how IT is playing a major role in reshaping the Middle East banking sector.

Industry Focus

3

feature

Banking on mobility GBM’s Director of Business Solutions, Seyed Golkar, gives his take on the Middle East banking industry, emphasising the importance in embracing the significant shift towards mobility, and protecting customers accordingly.

T

he influence of mobility, driven by the proliferation of smartphones and tablets, has spread rapidly through demographics and verticals. In no industry has this been more the case than banking, which is both blessed and blighted with one of the highest levels of consumer expectations.

Customers want the high level of user experience they get on their smartphones to be matched when carrying out services at their bank. Why should someone have to go to a bank or even computer to get a statement or make a transaction when they’ve got a device in their pocket perfectly capable of doing the same thing?

However, banks must be careful to balance this question with the vital issue of maintaining security. It’s all well 4

Industry Focus

and good being able to carry out these services on your smartphone, but that of course opens up a plethora of new protection concerns.

It is this convergence of all online, offline and mobile technology into a “post-channel world’ that is the top trend in the Middle East banking industry right now, according to Seyed Golkar, Director, Business Solutions, GBM. “Smartphones and tablets are ubiquitous and banks will have to launch next generation technology initiatives not only to stay competitive and increase their market share, but to also counter security concerns related to the sometimes carefree use of mobile devices by their customers and staff,” Golkar says.

“The competitive edge will be with those banks who master this mobile

evolution best while gaining meaningful insights into customer behaviour and profitability from the vast amount of data gathered along the way,” he adds.

Riding the wave According to Golkar, banking is one of the most progressive industries in the Middle East, which excels as a region where banks look to apply state of the art technologies in order to enhance their market position. This is particularly the case when it comes to operational efficiencies and customer services.

He refers to the “next wave” of technology advancement being experienced in the Middle East.

“Banks in the region have either completed their data consolidation and application integration, or are actually

going through this step as we speak. The next, and crucial, task for Middle East banks will be to utilise the technology available to them in such a way that noticeably improves the customer experience,” Golkar says.

Looking forward, the next technology trend that will capture the Middle East banking industry is the application of analytics.

“For example, banks can look into the wealth of warehoused data and social media information in order to get a better understanding of customer services, and thus offer services that are much more tailored to individual customer needs.

“This will eventually take the ‘know your customer’ (KYC) concept to ‘know your customer behaviour’ (KYCB). From an in-house productivity and efficiency perspective, banks will largely depend on their implementation of business process management solutions with models and concepts customised to the social, economic and regulatory requirements of the region.”

Golkar refers to the cultural and demographic diversity of banking customers in most GCC countries as necessitating a “reasonably sophisticated” banking industry in the region.

This, in turn, demands application of advanced technologies in this market sector. “We do encounter some early adopters of new trends in technology, such as cloud computing. The majority of banks, however, seem to prefer a more conservative approach,” Golkar says.

A sensitive subject The banking industry, with the possible exception of government, is the vertical which holds the most sensitive customer data.

With this in mind, there are existing tools and technologies that, if deployed correctly by banks, will allow a much higher data protection and help eliminate

Seyed Golkar, Director, Business Solutions, GBM

vulnerabilities that have recently been experienced by some organisations.

“These technologies have successfully been used by some cloud service providers and are available to any organisation,” Golkar says. “Regarding data protection, we see an increasing trend in the region to plan ahead and create the behavioural changes that are needed, instead of reacting to the next ‘big event’.”

He adds that security in general, and data protection in particular, is not a regional issue, but one that concerns organisations worldwide.

“Customer trust will naturally lean towards those organisations that take timely actions and correctly deploy the necessary preventative measures. The key to gaining and retaining customer trust, however, can not only be based on protecting and safeguarding data - which is not only invisible to the customer but also expected from a bank - but also on finding the right balance of

Smartphones and tablets are ubiquitous and banks will have to launch next generation technology initiatives not only to stay competitive and increase their market share, but to also counter security concerns related to the sometimes carefree use of mobile devices by their customers and staff.”

security/risk protection and service quality in the business processes. This avoids the situation where every customer interaction with the bank becomes time consuming and cumbersome just for ‘security reasons’.”

With regards to implementing the right solutions to ensure protection of customer data, Golkar believes the best approach is to employ an overall security framework that addresses people, applications, channels and processes.

He adds that these existing sophisticated technologies that address vulnerability must be deployed as a matter of urgency.

Looking forward, business process management and channel integration are key requisites for any bank to provide their customers with the banking experience of the future, while at the same time increasing efficiency and ensuring regulatory compliance, according to Golkar.

“Many banks in the region still struggle with how best to streamline their processes, especially across multiple channels, and the technical challenges of collecting data, analysing it and producing actionable insight,” he says.

“With the technology available today, the driving forces within the bank will no longer be IT and operations, but the risk managers, customer relationship managers and marketing managers. Data consolidation and integration, together with analytics, analytics and analytics will epitomise the banking industry in 2013.”

Industry Focus

5

CASE STUDY

Virtual supremacy In order to maintain its status as the leading bank in the UAE, the National Bank of Abu Dhabi (NBAD) recently underwent a major implementation to virtualise its head office and disaster recovery data centre.

W

ith over 300 IT personnel based at its headquarters, NBAD is a fairly large customer when it comes to information technology. The bank itself isn’t a small timer either - 123 branches in the UAE and 55 units overseas spread across four continents makes it a major player in the banking and finance sector.

In which case, NBAD had to maintain a level of quality within data information and security efficiency. As part of its development strategy, the bank decided to upgrade its HQ data centre and build a new disaster recovery site which offered more 6

Industry Focus

flexible, business-oriented architecture in order to address future demands.

The company wanted to increase profitability and establish industry standards for technology, efficiency, quality service and teamwork. The answer was through a live disaster recovery site, increased network bandwidth and capacity to accommodate media-rich applications, mobile and remote access.

In order to meet the mission objectives, GBM and Cisco proposed a solution to build the head office and DR site based on next-generation data centre architecture, which embodied the transition from a centralised physical

infrastructure to a highly-integrated virtualised environment.

“We needed something which allowed us a large amount of bandwidth in order to cope with the migration of our services into a virtualised environment. Nexus gave us the technology,” says Hossam El Kobrosy, Head of IT Infrastructure, NBAD. “The implementation spanned over six months and the solution was on production around the turn of the year, 2010. It’s a great achievement for us because by implementing end to end FCoE we gained more performance and increased our computing capacity with high availability.

We wanted to glue together our virtualised

We’re not finished yet with our virtualisation project - we’re still only about 60% of the way through. Managing physical servers was an obstacle for us, we are experiencing 25% expansion year on year, so before the virtualisation it was becoming impossible to maintain, and manage that amount of physical servers.”

The data centre architecture is based on the Cisco 6500 as a core and distribution switches, Cisco Nexus Platform as a core server farm/data centre switches and Cisco ASR routers as core routers.

NBAD looked into many different elements and factors before landing on a specific vendor for the solution.

“Because virtualisation was fairly new at that time, we chose to take the tough root. We’ve looked at the all the different layers around virtualisation. We analysed the market on each layer being the network, the computing power, the storage and the hypervisor. We went through an industry prospectus covering all these elements. We were looking for a way to have flexibility and not to be locked by single vendor, a kind of virtual platform that allows us to glue everything together with agility and scale in mind,” says El Kobrosy.

Hossam El Kobrosy, Head of IT Infrastructure, NBAD

“Though now, by removing the hurdle of complexity and having an integrated solution in one pool and space, it reduced the operating cycle and improved our IT services. It did require a long cycle of quality checks and troubleshooting, but the flexibility and optimisation of our servers now have made it worthwhile.”

It’s a big achievement for us because we’re early adopters in the region. We wanted to glue together our virtualised servers, network, storage, etc, into one seamless integration, providing our team with highly improved performance.”

servers, network and storage into one seamless integration architecture.”

The Nexus next-generation data centre architecture, which embodies the transition from a centralised physical infrastructure to a highly-integrated virtualised environment, links local networks, the information storage system and application delivery networks together, which makes it possible to use a single transport system for resolving any issue and eliminates the need for alternative networks to transmit data to the archive.

“We’ve managed to cut our power requirements and demand by more than 30% since completing the implementation.

“We have a long relationship with GBM, specifically for network support.

They have proven competency and skills in all the previous years. They have a very skilled people, and with Cisco both could provide a great solution.”

Major implementations of course offer causes for concern, and anticipating hurdles can be critical in the planning and development phase. NBAD implemented a very unique project in its sector and so making sure everything ran smoothly was one of the challenges the company faced.

“Things would just crop up and go wrong during the development stage of the process. Keeping an eye on these issues was one of the challenges.”

NBAD says that the ability and flexibility of its servers have all been optimised in the short time since the implementation was completed. A highly beneficial and relatively flawless implementation stands as testament to the collaborations in the region.

NBAD has also laid out the blueprints for future projects, demonstrating a good will of ambition to remain at the head of the industry.

“We’re still in the process of optimisation, that’s still going on.

Also, we’re looking to expand our data centre and create ‘always on’ types of environment. It’s an exciting time ahead for us,” El Kobrosy concludes.

Industry Focus

7

Analysis

Playing catch up As a new year approaches, David Whitton, Cluster Manager, Enterprise and Document Imaging, MEA, Kodak, says Middle East banks must catch up with government institutions in the implementation of content management technologies.

W

orldwide, the banking sector is the leading vertical when it comes to the implementation of document management systems.

By being able to scan an image and immediately store the information electronically, a bank can significantly improve customer service. For example, if a customer calls a bank and the bank then has instant access to a relevant record, it can provide a quick and onetime response – as opposed to making the customer hold or having to call back.

This trend has to an extent been reflected in the Middle East, Whitton says.

“What we find particularly in the Middle East is now when people open accounts they’re using our technology to scan all the associated documentation at the account-opening stage to improve the customer service.

They’re offering more than they did in the past when perhaps they took the documents and then scanned them later on. Now they’re scanning at the stage of content initiation.”

However, the Middle East differs to developed markets such as Europe and the US, where government follows banking and finance as the leading document management verticals.

“Here it’s the other way around – central government and local government have almost been the drivers of the

technology here and now the banks are playing catch up,” Whitton says.

He touts 2013 as the year where the region will witness a lot more implementation of content management technologies across enterprise applications, and when banks really get their applications as wide spread as government institutions.

“It’s vital for banks to have a good content management system,” he says. “You can’t really run a financial institution without good content management in my opinion. You have to have access to all your customers’ data. If you want to have a great relationship with your customers it’s a clear differentiator.

“If you want a loan agreement or a mortgage approval you need images of the signed contracts and then all the documentation in that workplace. As it progresses through approval, acceptance, offer stage etc. you need a proper way where it can be controlled. Adding the imaging capability allows the customer service to be that much quicker and more satisfactory.”

Shifting capabilities Asides from foreseeing a general increase in the uptake of content management solutions in the banking vertical, Whitton also anticipates a shift in their capabilities.

“The leading content management solutions have been going for possibly

It’s vital for banks to have a good content management system. You can’t really run a financial institution without good content management in my opinion. You have to have access to all your customers’ data. If you want to have a great relationship with your customers it’s a clear differentiator.”

8

Industry Focus

10 or 20 years, but most are based on capturing structured document information or semi-structured document information.

“What you’ll see going forward is people looking at unstructured information and almost deciding what type of document has been scanned just by looking at the type of document and then extracting information from those documents as and when necessary. Going forward I see that as a big trend and Kodak certainly seeks to play its part next year in that space.”

Looking forward, Kodak is also preparing for the move to hybrid data solutions.

“Yes, there’ll still be lots of paper processes to be managed, but also there’ll be a lot more electronic processes to be managed. Banks will be looking for content management solutions that can manage not only paper documents, but also things like Web applications - you’ll see lots more Web browsing in client technology,” Whitton says.

“Typically content management systems used thick clients but I think you’ll see a trend now to thin client solutions. To be able to manage electronic documents on a thin client basis is quite straight forward, where as paper is that bit more content rich when you’ve got the image, but the solutions are now there to handle that as well.”

Whitton attributes the explosion of big data to the increase in demand Kodak has seen in its solutions, and only sees this continuing in 2013.

“This is only the start – these are the first steps into enterprise content management for these institutions.

They’ve done their first couple of applications this year and they’ll be rolling out many more applications next year and the year after,” he concludes.

Interview

Stephen Fernandes, AVP and Head of Middle East, Cognizant

Driving differentiation The banking sector in the Middle East is one of the fastest growing markets in the world. Intense competition and pressures on profitability are driving banks to invest in technology to support a more customer-centric approach. Banks in the region are broadening their IT investments from pure core banking systems to more advanced solutions that drive differentiation via increased operational agility and improved customer intimacy. Stephen Fernandes, AVP and Head of Middle East, Cognizant, explains how IT is playing a major role in reshaping the Middle East banking sector.

Industry Focus

9

Interview

W

hat are the significant developments in the Middle East banking sector today?

The Middle East banking sector remains stable and cautiously optimistic. A desire to reinforce the quality of assets, protect existing market share, optimise performance, and pursue sustainable growth are at the top of the mind for the Middle East banking sector today. At a time when most global banks are consolidating, re-engineering and transforming operations in order to optimise costs and efficiencies and drive growth, the fact that Middle East banks are well capitalised and have funds at their disposal to leverage new growth opportunities positions them well.

However, they are not without challenges.

Changing regulations, varying demands of a diversified customer demographic, limited talent pool, and a rapidly moving political landscape are some of the challenges facing the industry today.

From a customer services standpoint, what are the changes impacting banking systems in the Middle East?

Banks have already started tailoring their customer communications to suit individual preferences. This includes developing and harnessing multiple channels of communication for customers to pick and choose from based on how they wish to engage with their banks.

From traditional letter and phone-based interaction to online and social media, many banks are embracing new ways of working. Many mortgage brokers or bank managers are turning to tablets to show the customer the different options available, making the experience more intuitive and akin to their own experiences at home. This consumerisation is only set to increase and private banking is a surprising, if inevitable, next step along this journey. Private banking has traditionally been exclusive and relatively expensive, which is why it was until recently the domain of large companies and high net worth individuals. However, as retail banking braces itself up to face challenges stemming from a difficult economy and ever more stringent regulations and restrictions, private 10

Industry Focus

banking and wealth management are emerging as growth areas that can help large banks enhance their margins. This has also led to an increased focus on enduser security for customer data protection.

What are the technology trends impacting the Middle East banking sector?

Banks are using IT to concurrently address the dual mandate of driving efficiency and effectiveness while investing in innovation and business transformation for long-term growth objectives. Many banks have opted for reengineering their user interfaces across delivery channels, in an attempt to provide customers with an integrated

proliferating data. Other areas attracting significant technology investments are core banking upgrades, risk management and disaster recovery.

Can you elaborate on the impacts of mobile, social, analytics and cloud on banking?

Mobile technology has real potential to significantly change consumer-facing industries such as banking. As a route to market, it reshapes the channel mix; as a computing and service platform, it redraws the ways in which businesses engage with customers; and as a new technology architecture, it creates opportunities for new products and revenues. The accent in the rapidly

Banks need to embrace virtualisation and the power of cloud computing to reduce the capital expenditures related to building and managing IT infrastructure to deal with ever-increasing volume of data. Cloud-based models such as BPaaS have emerged as key tools for further reducing costs.” multichannel user experience. By eliminating these channel silos, they can lower operating costs and improve timeto-market with new products, as well as provide seamless customer experience across channels. This type of innovation will drive customer acquisition and retention, changing methods of customer engagement from “push” to “pull” across the physical and virtual worlds. Even as they look to do this, banks must protect their existing customer base from the growing threat of non-traditional competitors that have entered the banking space with disruptive technology advancements. Many banks are turning to mobile services and social media to create operational improvements, as well as analytics-based - and thus more targeted and personalised - ways of engaging with customers across all demographics, especially the increasingly significant millennial market segment. Cloud computing has emerged as a way to drive down costs to pay for this service delivery innovation. Furthermore, analytics-asa-service has the potential to monetise

changing world of consumer services is on true personalisation, context-aware systems and real-time services.

Mobile devices are creating opportunities for banks to offer customers innovative ways of performing traditional banking functions. Nowhere is this trend more evident than in the area of mobile payments. Initial mobile banking services were basic in nature - checking balances, etc. - but advancements in device and communication technologies and the creation of native applications for mobile devices are allowing these services to move up the value chain, overcoming geographical and technological boundaries.

If mobility is leading the way in banking product and service innovation, social networking is transforming how banks interact with customers and strengthen their brands and reputations.

While social networking has been successfully leveraged across many industries overall, banks, especially in the Middle East, have been slow in reaping its benefits. Successful integration of social

media into the overall strategy of a bank requires a long-term commitment as part of an overall retail strategy, and not a one-off effort that creates yet another channel silo.

Big data - defined as datasets that are so large, fast-growing and diverse that they cannot be managed by traditional means - is at the heart of how banks can cash in on the multi-channel experience. To harness the power of big data, banks need to implement data architectures that help create a single customer view across externally available data and internal enterprise data. This will require a move away from siloed data management and inconsistent data, as banks are now required to take a more holistic view of risk across the organisation. Combined with enterprise data management, banks can use analytics to better understand their risk exposures and make decisions accordingly.

Finally, banks need to embrace virtualisation and the power of cloud computing to reduce the capital expenditures related to building and managing IT infrastructure to deal with ever-increasing volume of data. Cloudbased models such as business processas-a-service (BPaaS) have emerged as key tools for further reducing costs related to technology and talent acquisition.

What is the new enterprise IT model that Cognizant advocates to its customers?

The foundation for “a new normal” is built on three pillars: a new generation of highly distributed and virtualised business models; a new generation of cloud and mobile technologies; and a new generation of born-digital workers and consumers, the so-called ‘millennials’. In this virtualised, globalised environment where new technologies like cloud

computing and social networks intersect with the millennial generation, clients are looking for better ways to organise teams, cultivate innovation, allocate resources, and reinvent knowledge processes. At Cognizant, we call it the ‘future of work’.

The new emerging corporate IT stack based on social, mobile, analytics and cloud - or ‘SMAC’ for short - is one of our key focus areas. Though driven by technology change, the SMAC stack has a far-reaching impact on all aspects of business models. Our clients are becoming more technology intensive and these hugely disruptive new SMAC technologies are allowing them to differentiate themselves and drive new sources of revenue. The SMAC stack lays a solid foundation for Cognizant’s longterm growth and distinguishes us with our clients as thought leaders.

INNOVATION IN BANKING BECAUSE 20TH CENTURY BUSINESS HABITS DON’T BELONG HERE. The old ways won’t cut it anymore. That’s why we’re helping banks around the world rethink their operating models, reinvent how they work, and rewire operations to achieve greater levels of business efficiency and performance.

Business Consulting Application Services

IT Infrastructure Services Business Process Outsourcing

UAE Headquarters

KSA Headquarters

Office No. 2301, Al Thuraya Tower 2 Dubai Internet City, P.O. Box 500378 Dubai, United Arab Emirates

28th Floor, Kingdom Tower PO Box 230888, Riyadh 11321 Kingdom of Saudi Arabia

Phone: +9714 4347608 Fax: +9714 4290325 Email: inquirymiddleeast@cognizant.com

Phone: +966 1 211 8076 Fax: +966 1 211 8001 Email: inquirymiddleeast@cognizant.com

THE FUTURE IS NOW. LET’S PUT IT TO WORK. cognizant.com/futureofwork

© 2012 Cognizant Technology Solutions