ING's 'replicated' approach to global IT

ING has expanded around the globe by giving leaders within the company some autonomy in building out their part of the business in the countries where they operate. While that approach has benefited the company in important ways, it also created a global organization with a multiplicity of IT systems, reports Chris Murphy at InformationWeek.

Balancing the benefits of scale against local customization needs is a widespread challenge for IT, Murphy notes. The way ING is addressing the challenge is outlined in a paper, "Between Anarchy and Dictatorship," written by two of the company's CIOs and the Boston Consulting Group. 

In the past, IT decisions at ING tended to be either isolated (in which a country followed its own approach) or completely shared, meaning that a program was run centrally. Now the bank takes a more global IT operating approach, which means that headquarters or another single country runs core software infrastructure, but local units have the option to configure things they way they want to. "So the Netherlands and Poland can have different savings account rates to reward long-time customers, but the back-end software system and process for transferring money into an account are identical," Murphy explains.

There are still instances, however, where local CIOs seek customized software. "The first thing was always 'We can't do this because my country does not allow it,'" said Saul van Beurden, CIO of retail banking direct and international at ING. To deflect those requests, the bank examined the laws and regulations in each nation it does business in and discovered just four countries that restrict it from maintaining data in a data center outside the national borders.

Now if a local unit wants customized software, the CIO has to go before eight or nine executives who make up a technology standards board and explain why there should be an exception to the rule.

"This is not an easy catch, not something you do overnight," van Beurden said about the new approach. "It will be two or three years before you see standardization on such a scale that the footprint for the bank is really becoming lightweight instead of heavyweight, and the cost is going down and the speed is going up."

For more:
- see Chris Murphy's article at InformationWeek

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