It’s a cliché, but why are we still reinventing wheels?
It is increasingly clear that the real value and opportunity in open-source isn’t so much the actual software itself, but the collaborative mindset and ecosystem that produces and maintains it. All too often, though, it can be a challenge for open-source advocates to persuade risk-averse board members who are used to conventional methods and thinking.
It’s good news then to see progress being made here in financial services. This is an industry that many would think of as a bastion of conservative thinking, but the truth of course is rather different. This is indeed a risk-averse industry, but it is also immensely technological and well-funded, and keen to use IT wherever it might save time and make money.
To give a flavour of what’s going on, at a recent strategy forum hosted by the Fintech Open Source Foundation (FINOS) in London, I heard Deutsche Bank managing director Russell Green declare that every project they do has open-source in it – and indeed that “open-source is everywhere” in that organisation.
Does it add real value, or is it mainly plumbing?
That’s not to say the whole of a service will be open-source, mind you – it might merely use open-source components or connectors – or that banks and others will in turn open-source all their internal projects. Some systems are genuine differentiators and bring competitive advantage. But others are plumbing – they’re things everyone needs or does, or that connect different financial operators together. As Liz Rice, the chief open-source officer at software company Isovalent, pointed out, nobody now expects to make their own screws and bolts. That was the norm before the industrial revolution, however, and the resulting parts were not standard or interchangeable.
There are still problems or challenges, of course. Collaborative open-source is great for things like speedy bug-fixes, but there’s still security and trust issues to deal with when it comes to actually contributing code back to the project.
It’s also not just about software: as well as open-source hardware, we’re also seeing growing interest in open-sourcing APIs and even regulatory frameworks.
For those keen to join the open-source ecosystem and collaborate, Russell Green had some sage advice. For example, it’s important to understand the cost and liability implications of open-sourcing something – will you need to write it off your balance sheet, say?
And he warned that it’s essential to check the software licences – there is no one standard licence for open-source software, and it’s vital not to make the assumption I alluded to earlier – that open-source equals ‘free’. As well as obvious risks, such as the developer making it free only for personal and non-commercial use, others might for example limit it to an organisation’s internal use. For an enterprise, getting it wrong can be an expensive mistake.
No organisation is an island
This is just due diligence however, and none of it should put off organisations, financial or otherwise, from working with open-source. Much more important is the fact that – for those shared challenges at least, such as regulatory compliance in the financial industry – you can avoid reinventing the wheel.
Not only can this make it easier to cooperate with business partners and so on, but it can deliver more effective results. After all, no one wants to hear a customer or regulator say you’ve not even got the basics right.
To summarise the summary (thanks, Douglas Adams!), there’s lots of different layers to “open-source”. There’s both bits you consume and bits you contribute, but in every case the fundamental value is the collaboration.
No organisation is an island, and by working together – on the plumbing, at least – we can get better, cheaper and faster results for everybody. If your organisation isn’t invested and involved here, how much are you losing?