Author Archives: Alan Street

About Alan Street

I work at IBM.

Reading List: MITRE System Engineering Guide

The head of strategy for a major corporation once told me that if he wanted an iPad app he could get a local vendor to build one in 2 weeks.  I responded “An iPad app to do what?”  He thought for a moment, and then said that I had a point.

You can build a consensus around a simple iPad app — or anything simple, for that matter.  And it certainly sounds easy enough to build.

Simple designs for consumer products are better than complex designs–especially because they need to fit into a complex consumer life.  Simple enterprise systems are better–especially because they need to fit into a complex enterprise.

But the process to design something simple such that it fits into a complex environment is not simple.

In fact, the process is called System Engineering, which doesn’t even sound simple.  It certainly doesn’t sound like a “quick win” or anything that will deliver results this quarter!  If you split “System Engineering” in half, both words still sound complicated.  If you prepend the word “complex” then you get “Complex Systems Engineering”.   Who invited this guy to the meeting?

Nonetheless, someone has to take on the thankless job of taming this complexity into a system that can be used by people who have no time to understand a complex system because they are working in a complex environment.  This task falls to us designers, architects and engineers.

For the architects and engineers I recommend a look at the MITRE Systems Engineering Guide.  There are many SE processes that are tailored to different uses and you do not need to stop using yours and use this one, but it is a good baseline to use to make sure that the people who want to “keep it simple” have not stripped your process down to something that misses the point:  Complexity.

I also recommend a look at ZAPTHINK’s Vision for Enterprise IT in 2020.  Complex System Engineering is one of a handful of competencies listed that is required for “Designing systems to exhibit emergent properties like business agility”.

Technology Trend: WiFi Availability

This entry is part 24 of 30 in the series Trends

According to Digital Banker the number of WiFi units shipped has quadrupled in the last five years (as of mid-2014).

This should also be considered a market trend as consumers are most certainly coming to expect WiFi.  I keep the mobile data turned off on one of my phones and I know many who do the same.  I get annoyed when a place of business does not provide WiFi.

I can not imagine working without WiFi but many bank branch employees must do just that.  How do they help customers without access to the bank Web site and Google?  Do they drag customers back to their desk?  If so, the site they need access to is probably blocked–An architect at a major bank in ASEAN complained that he couldn’t even access my blog!

Banks need WiFi in their branches for both their employees and their customers.

Potential Industry Trend: Bank as Data Manager

This entry is part 23 of 30 in the series Trends

Almost every time we brainstorm bank business models someone raises the idea of a digital vault, yet I have not seen that offered as a feature by any of the banks I use.  It makes sense that a bank would consider data security a core competency and choose to leverage it as one of its dual strategies.

Skinner spends a lot of time on banks as data managers in Digital Bank.  I agree, but I don’t see it yet, so let’s call it a potential trend.

Technology Trend: Big Data

This entry is part 22 of 30 in the series Trends

I have been wondering what to say about big data in banking.  I have heard of some projects here and there but not seen much of a trend.

I was reading Digital Bank and found this about what banks are doing with Big Data:

Most are not talking publicly about how they use customer transaction data as a competitive weapon because it is exactly that— a competitive weapon. Visa is one of the exceptions, saying that it can now analyze two years’ worth of customer transaction records, or 73 billion transactions amounting to 36 terabytes of data, in 13 minutes using cloud computing . This would previously have taken a month with traditional methods of internal computer processing.

On the other hand this reminds me of a project I did when I was 17 years old.  That was a long time ago!  My good friend Jim at Cooper Aerial in Las Vegas needed help processing loads of contour map data.  His team created digital contour maps by using stereoscopic aerial photographs to digitize 3D coordinates with a stereoscope.  They needed to process this data in hours but it was taking days-to-weeks using their CAD software.  I wrote a program in BasicA on one of my Dad’s PC’s that indexed the data such that it could quickly be accessed to do the processing they needed.  We got the time down to about 90 minutes.  Was this a big data problem?  No.  There was a lot of data, but it was all similar, structured, quality data.  This was my first great software development project and my début as an independent consultant, but it was not a big data project.

So not all big data is Big Data.  IBM defines Big Data as data having multiple characteristics:  Volume, variety, velocity, [lack of] veracity.  See the IBM info-graphic below…

Unless Visa is, like other big banks, downloading Google searches to determine that a payment to Ying’s Wings is a purchase at a Chinese restaurant, or introducing some other unstructured data, or processing the data in real time, then it is an impressive application of analytics, but might not contribute to a big data trend.

See the AWS Case Study: Bankinter for another banking big data example, this time with credit simulations.

ibm-big-data

Industry Trend: Social Finance

This entry is part 21 of 30 in the series Trends

waspit is a social banking platform targeting college students that offers social banking experiences with payments, offers, loyalty, and reviews.

The “Social Lending and Savings” section of Digital Bank notes the trend of Social Finance.

Skinner covers the following:

  • Zopa in the UK
  • smava in Germany
  • Ppdai in China
  • Prosper and Lending Club in the United States
  • RateSetter and Folk2Folk in the UK.

Examples of Social Saving include:

  • iWish from ICICI Bank in India
  • SmartyPig in the United States
  • BBVA and the Compass app.

Digital Banking also covers Social Funding and Investing.

Crowdfunding of new business start-ups and include:

  • United States: KickStarter, Indiegogo, crowdrise, razoo, MedStartr
  • UK: Funding Circle, CrowdCube, Seedrs and ThinCats.

Crowdfunding platforms raised almost $ 1.5 billion worldwide in 2011, with a growth rate of 63 per cent CAGR.

Wonga is a UK company providing online payday loans (short-term, high-cost credit).  In the US there is Cash America and Advance America.

Social Trading examples include eToro, ZuluTrade, Tradency, and StockTwits.

Deloitte observes that P2P business lending in the UK rose by 211% between 2012 and 2013.   In 2014 P2P lending accounted for £250m in UK personal loans.

Financial Times reports that the UK’s peer-to-peer lending market has tripled in size in just three years, was worth £550m by mid-2013, and will be worth £1bn by 2016 if it continues to grow at its current speed.”

More on this in Industry Trend: Unbundling of banks – Lending Club.

Industry Trend: Virtual Currencies

This entry is part 20 of 30 in the series Trends

Currently reading Skinner’s Digital Bank and noting down the trend around virtual currencies such as game currencies and Bitcoin.  The most notable trend is the number of failures, which is why I tend to limit my time spent on this space.

Gaming / social currencies covered in Digital Bank:

  • NHN in Japan – Line Coins
  • KakaoTalk in Korea – Choco
  • Tencent’s in China – QQ
  • DeNa in Japan – Moba
  • Facebook – Zynga credits
  • World of Warcraft – Diablo Gold
  • Amazon Coins.

Recent acquisitions noted:

  • VISA acquired PlaySpan, a company with a payment platform that handles transactions for digital goods
  • American Express has purchased Sometrics , a company that helps video game makers establish virtual currencies.

 

Industry Trend: Social & Mobile Payments

This entry is part 19 of 30 in the series Trends

Payments is such a hot topic I feel so me-too’sh just mentioning it.

Venmo, (see in app store), provides one-touch payments across multiple applications.  The Venmo App eliminates the need for users to enter their payment information on multiple applications. It is an online payments gateway provider that stores consumers’ payment information for future use at those merchants.

I enjoyed the summary in Skinner’s Digital Bank under “Social Money and Payments”.  He covers:

  • P2P internet payments such as PayPal
  • Mobile remittances such as M-PESA
  • Long list of long-tail merchant payments such as Square, PayPal Here, Silver, iZettle, mPowa, Payatrader, Intuit GoPayment, Bancard PayAnywhere, Verifone, Payleven and Sumup.
  • Payments with mobile wallets such as Google Wallet
  • Payments with virtual currencies such as Bitcoin
  • Bank social payments such as iDEAL and ePayo.