Complexity is the common enemy of every IT leader. Ask any group of IT managers what is their biggest day-to-day challenge, and the answer you will most often receive points at the complexity of legacy infrastructure.
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For too long, IT departments and their suppliers have used that complexity as a protective suit – when asked, “Can you do this?” the response has been, “Ooh, that’s complicated.”
For many years, it’s been easy to get away with it, as the business users or IT buyers were at a disadvantage in their technology knowledge.
But things have changed. Now, everyone’s expectations of technology simplicity are set by Google, Facebook and eBay. We as IT experts might understand the incredible complexity behind the ability to “Like” the Team GB Olympics page, but for the users all they see is the simplicity of clicking a button.
Those expectations are what IT departments now have to live up to.
Nowhere is this becoming more apparent than in financial services. There are growing calls for IT to be regulated across the banking sector after the Royal Bank of Scotland and NatWest fiasco that prevented customers accessing their accounts.
A report this week by IT trade body intellect estimates that banks spend 90% of their IT budget on managing legacy infrastructure – that is simply unsustainable.
Banking systems are among the most complex around – developed over years, often reliant on ageing mainframes and applications that are well past their best-before date, but which do their job day in, day out. Add to that the number of mergers in the sector, with overlapping systems having to be integrated – and add too the customer-facing systems that have been bolted on top to deliver online and mobile banking.
It all works, mostly. And the cost of updating a mostly functioning but ageing system is difficult to justify when the replacement will effectively do the same job, just with newer hardware and software. It’s even harder to justify in the middle of an ongoing banking crisis.
But if IT now represents the arteries of the financial world, then those arteries are increasingly sclerotic and one day the blockage will become terminal.
Banks are in an impossible position – needing to spend money to remove complexity with little return on investment. But if they want to avoid regulated IT systems, and have an IT infrastructure with the flexibility to cope with rapidly changing customer requirements, that cash is going to have to be spent.