Poul Raaholt, CIO of Nordea Bank, reveals how migrating from legacy systems to a new digital services model should be viewed not as a challenge but as an opportunity for the industry.
Future Banking: What are the major issues facing the financial services industry today from a core IT systems perspective?
Poul Raaholt: The financial services industry is increasingly turning into a 'digital business', and this is as much an opportunity as a challenge for the industry. Most financial institutions have core IT solutions on older technology and are at the same time dealing with complexity in their IT landscapes, which have been built over time. Fortunately, these issues can be managed, and those institutions that are taking the right actions from a longer-term perspective and are taking actions that create great customer experiences will gain competitive advantages.
What are the key challenges you face in your role as CIO?
I probably share challenges with most CIOs: the value creation from IT must increase whilst at the same time costs must be contained, and risk prudently managed. Having said that, it is also a great opportunity to be a CIO in an industry that is increasingly realising its own change from being 'classical financial services' to becoming more and more of a 'digital services business'.
There has been a lot of talk about legacy systems and the impact that this has had on a bank. To what level do a bank's systems need to be flexible - in other words, future-proofed?
Banks must ensure that their IT solutions are well architected and have adequate complexity, as time to market and flexibility in the ability to deliver digital banking services will increasingly impact competitive power. This is, however, not only a question of IT systems needing to be flexible; the development in the market calls for constantly increased in-built agility in the entirety of the banking organisation as well as in its business infrastructure.
Can you tell us a little bit about some of the recent projects your IT department has been working on?
In general we have projects aimed at aligning our IT landscape and its architecture to future competitive needs, basically to ensure that we take timely action in order to further improve and be as strong in the digital area as we are in the classical banking disciplines. We work on securing great customer experiences (including high availability of IT solutions), and we work on containing costs, increasing the maturity of IT in its various disciplines, and managing risks.