nagaraj govindarao...rise of fintech “fuelling digital disruption” 14% of millennial small...
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© 2016 Cognizant © 2016 Cognizant
Creating business value
by rapid adoption
of new technologies
Nagaraj Govindarao
Global Delivery Head,
Cognizant BFS
Products Solutions Practice
Ashutosh Sharma
Head - Banking Products,
Cognizant BFS
Products Solutions Practice
© 2016 Cognizant
Agenda
BFS – Constantly
Changing ParadigmBank’s Way
Forward
Cognizant –
a Change Catalyst
Cognizant Digital
Works Collaboratory
About
Cognizant
2
$
© 2016 Cognizant © 2016 Cognizant
About Cognizant
© 2016 Cognizant
Financial Times Global
500#281
#4 2015 FinTech Forward 100
Forbes Fast Tech 25#18
Newsweek’s 2015 World
Green Rankings#93
Forbes The World’s Most
Innovative Companies
2015#96
Fortune 500#288
Forbes Global 2000#637
Founded in 1994
(NASDAQ: CTSH)
~233,000
Employees*
35+ Regional sales &
Client relationship
offices
308 Strategic Clients
38,500+
Projects in 40+ countries
Market Cap Over
$38.19 Bn*
Revenue: $3.20 Bn in Q1 2016 (10% YoY); $12.42 Bn for FY 2015 (21% YOY)
Guidance: $13.65 - $14.0 Bn for FY 2016; $3.34 - $3.40 Bn for Q2 2016;
Revenue (Q1 2016)
NA: 78%, Europe: 16.4%, RoW:
5.6%
BFSI: 40.2%, Healthcare: 28.5%,
Retail/ManLog: 19.8%, Other:
11.5%
100+ Global
Delivery Centers
Headquarters
Teaneck, NJ
Everest Group’s PEAK
Matrix Service Provider of
the YearTM for IT services#1
Overview
Social Presence4
© 2016 Cognizant
Banking and Financial Services - Practice Snapshot
BUILDING CAPABILITIES
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BROADENING MARKETS EXPANDING RELATIONSHIPS
52,800+Employees
1240+ Business Consultants
1950+Product Specialists
16 out of top 20 North American Financial Institutions
9 out of top 10 European Banks
215+Clients
27+Alliances and
Partners
2Consulting
Acquisitions
Leader
#4 in FINTECH
Forward Rankings
2015 –
steady rise from
#30 in 2006 (Oct.
2015)
25 Countries Including Delivery Centers across
the globe
Outsourcing
Partner of the
Year
(Mar. 2015)
#96 (Aug. 2015)
Eighth Year
in a Row.
#5
(Feb. 2016)Positioned in the Winner’s
circle of HFS Blueprint
Grid - BFS Analytics
Services (Mar. 2016)
Mobility, Big Data &
Analytics Services in Global
Banking ITO; Banking AO,
Capital Markets AO & BPO
Focus areas across
Banking (59%) and
Capital Markets (41%)
5
© 2016 Cognizant
Temenos Practice Overview
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Key Highlights
~675 dedicated
consultants
200+ projects
25+ Clients
~200+ T24
certifications
45+ TAP Bronze
certifications
Engagements and Services
• First global SI partner since 2009• Only Managed Migration partner for Temenos• Certified partner for Upgrades, Development, & Testing
Temenos Partnership• wealthQUAY BPaaS offering• Strong alignment at Global/regional levels• Product Engineering
Tools and Enablers• Temenos labs hosting Suites & Frameworks• Proprietary tools for Implementation• Reusable assets, Model Bank Test cases repository
Temenos Solutions
Suites
• Corporate• Islamic• Retail• Universal• Wealth
Products
• Core • Analytics• Front Office• Channels• Payments• Funds & Securities
Frameworks
• Integration• Platform• Design• Interaction• Data Framework
© 2016 Cognizant © 2016 Cognizant
BFS - Constantly Changing Paradigm
© 2016 Cognizant
Digital Trends are “reshaping the landscape” of BFS industry
CUSTOMER EXPERIENCE
FINTECH
CLOUD
WEARABLE
BLOCKCHAIN
OPEN
API
ANALYTICS
BIG DATA
OMINCHANNEL
MOBILITY
ROBO ADVISORCYBERSECURITY
SOCIAL
DIGITAL WALLETS
INTERNET OF THINGS
B
Y
O
D
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© 2016 Cognizant
Shifting customer Demographics (Millennial and Gen Z) and the
rise of FinTech “fuelling digital disruption”
14% of Millennial small
business owners use
alternative (nonbank)
financing
Only
50%expect to use cash
on a weekly basis
by 2020
50% are counting on
tech startups to
overhaul banks
63%Millennials do not
have a credit card
33%believe they
won't need a
bank in 5 years
By 2020
50% Of workforce will
consist of Millennial
and Gen Z
By 2018
$200BIs the estimated
spending power of
the Gen Z
Population
Cheaper rates offered by
TRANSFERWISE for Peer-to-
Peer money transfer
1/8x
combined loans originated by
LENDINGCLUB and PROSPER
$10B
Growth in Proximity mobile pay.
Expected to reach $64Bn in 2017
in US
163%
Automated wealth advisers
target the underserved HENRY
market segment
Henry
Taken by WEALTHFRONT
to reach 2nd billion in AUM
9 months
Investments in global FinTech companies grew from
$4Bn in 2013 to nearly $20Bn in 2015
Raised by Global Crowdfunding
Industry in 2015. A growth
of 112%
$34B
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© 2016 Cognizant 10
Financial Services industry is facing a diverse set of challenges
Anemic Growth
Digital Disruption
Legacy technology
and processes
Increasing Cost Ratios
Growing Regulatory
Pressure
Declining Public Trust
© 2016 Cognizant © 2016 Cognizant
Bank’s Way Forward
© 2016 Cognizant
Banks to Respond to Change
Technology Disruption
Is RealSigns of adoption
Velocity of Change is high
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© 2016 Cognizant
Early Movers - Trends of Agility and Speed in Banking
New Digital-only Bank in 18 months
Collaborate with Kabbage to offer Working Capital Loans
First US bank to offer Real Time Domestic payments
OneTouch authentication feature in low budget
Opened Banking APIs to support full scale releases
400 product releases a month
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© 2016 Cognizant © 2016 Cognizant
Cognizant –Supporting Change
© 2016 Cognizant
Focus Areas for Banks
Transformation of Bank’s Architecture
Adoption of Micro- Services and APIs
DevOps - Future of Development & Testing
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© 2016 Cognizant
Transformation of Bank’s Architecture
Future State Enterprise Application Landscape
Customer Facing Revenue & Growth Supporting
Disruptive Technology Based Transformative
Business IntelligenceIntegrated Architecture Focused
Large Enterprise Applications Automation-driven
Data ConsolidationLights-on/BAU Focused
Infrastructure Focused Usability/Productivity Driven
BACK-END
MIDDLE-LAYER
FRONT-END
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© 2016 Cognizant
Digitization of Overall Banking Functions
Investing in
emerging tools and
technologies
Establishing a
modular solution
architecture and
operating model
Providing open
APIs as strategic
tools to expand the
business value
chain
Leveraging data
as a key resource
to fix process
bottlenecks
Methodologies
36% Transformation
solution
implementation
23%Strategic solution
implementation
25%Tactical solution
implementation
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* Based on CIO Survey 2015 conducted by Cognizant Research Center
© 2016 Cognizant
By 2016, 50% of banks in “The Banker’s
Top 1,000 world banks” will launch
a public web API platform
50%Top 1,000 Banks
BANKS WILL WARM UP
TO APIS
“Banking as a Platform / Service” strategy!
$660 Million
Overall US API
Management Spending
2014
2020
29.3% CAGR$140
Million
API and Microservices Growth
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© 2016 Cognizant
Microservices Implementation for a U.S. Bank Holding Company
Leading U.S. based Bank
Holding Company wanted to:
• Enable innovation,
Improve speed to market
• Simplify middleware
delivery
Business
Situation
• IT landscape with 150+
services• Services lacked
governance, bounded
context concept and the
domain was spread across
multiple lines
ChallengesSolution-
Microservices
Architecture
• Improved customer
retention
• Ecosystem for digital
innovation
• Shorter delivery
timelines
Benefits
Case Study
19
© 2016 Cognizant 20
DevOps - Making continuous delivery a reality
Software Development
(Engineering)
Quality Assurance (QA)Technology Operations
Test
AutomationLogging &
Monitoring
Service
VirtualizationRequirements
Management
Integration
Deployment
AutomationProvisioningTest Environment
Management
Continuous
Integration
DevOps
© 2016 Cognizant
Case StudyBritish multinational banking and financial services company
• Escalating cost of Run-the-
Bank
• Human errors and delays
due to lack of tools
integration
• Multiple handoffs and
lack of automation in
deployment
• Impact on agility, schedule,
quality and productivity
Challenges
Manual
(As-IS)
Total
>2days
Automated
Deployment
(To-Be)
Total
<13mins
1. DEV Console source
snapshot check
2. Export twx from DEV
console
3. Promoting twx package
to SIT region
4. Install package
5. Results output and
send notifications
6. Manual lag
~20X increase
in Speed
Solution-
Microservices
Architecture
5
10
45
5
2days
<1
<1
<1
<9
0
BPM
DevOps
Solution
~25%
Spend Optimization
30% Increase in Automation
30% Build & Release
optimization
2 level Maturity Levels
99% Technology
Standardization & Compliance
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Business
Situation
• Operations in 50+ countries
with 48 million customers.
• Offerings across multiple
domains
© 2016 Cognizant © 2016 Cognizant
Cognizant Digital Works Collaboratory
© 2016 Cognizant
Need for collaboration between ...
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Existing
Enviroment
Great
Concepts
Disruptive
Ideas
Modernize to
Enhance
effectiveness
Large
Implementations
Time to
Market
Complexities
of existing IT
environment
FinTech Startups Banks
Adopt to
Stay
relevant
Integration
Challenges
Collaboration
Delayed
Projects
© 2016 Cognizant 24
The Cognizant Digital Collaboratory - “Accelerator Process”
Collaboratory
Iterate
Virtual
Banking
Ecosystem
Idea Lab
Engage with
Fintechs
Idea
Generation
Tech Foundry
Pilot Solution
Scaling
Assess
Business
Feasibility
Build a
Prototype
Co-innovate
in a “Lab” Define MVP
© 2016 Cognizant 25
Helping Banks to embrace the Change
Solution to transform retail
branch experience of customers using
Estimate
beacons
In-store mobilepayment and
couponing platform facilitating any time anywhere payment
through bank accounts.
Marker based
augmented realitysolution which offer immersive experience by combining real world objects with personalized and interactive digital information layer
investment management solution that brings like minded people together for investments and leverages
social network effect for
better portfolio management in a very simple and transparent way.
© 2016 Cognizant
Thank YouNagaraj Govindarao
Ashutosh Sharma
The Time to Act is now -
Reinvigorate your Business with us