forecast deploy1 100_ak2

CLOUD STRATEGY AND IMPLEMENTATION

Denis CurranHead of Strategy & InnovationNational Austral ia Bank

AGENDA

NAB’s Strategic ContextNAB’s Cloud DriversThe Path We’ve TravelledCloud StrategyStrategy Implementation

2

NAB’S STRATEGIC CONTEXT

And how we’re driving our Technology agenda

3

WHAT IS A BANK?

4

COMPETITIVE FACTORS DRIVING CHANGE

Legacy systems

Ageing, intertwined systems

High cost to adapt

Manual workarounds

Unattractive to workforce

Cost & risk

Simplify E2E processes

Reduce rework

High/continuous availability

Resilience

Innovation cycle

Consumerisation driving user experience

Rapid rise (and fall) of ICT enabled services

Competitive threats from new industry models

ICT industry development

Rapidly falling costs of new technologies

Leverage massive data

Mature service providers

Cloud

Enable customers and employees

Total Environment Transformation

Help, guidance and advice

Collaborative

Mobile, real-time, 24x7

Secure

Self-service

Omni-channel

Relationship

Service/product innovation

5

EXAMPLE – CUSTOMER CHANNEL PREFERENCE

Oct 08 Oct 09 Oct 10 Oct 11 Oct 120%

10%

20%

30%

40%

50%

60%

70%% of total transactions by channel

Branch OTC Linear (Branch OTC) Internet Banking Transactions Mobile Internet Banking Transactions ATM

Trend line

6

EXAMPLE – CUSTOMER CHANNEL USAGE

Oct-08

Dec-08

Feb-09

Apr-09

Jun-09

Aug-09

Oct-09

Dec-09

Feb-10

Apr-10

Jun-10

Aug-10

Oct-10

Dec-10

Feb-11

Apr-11

Jun-11

Aug-11

Oct-11

Dec-11

Feb-12

Apr-12

Jun-12

Aug-12

Oct-12

Dec-12

Feb-13

Apr-13

Jun-13

Aug-13

Oct-13

k

2000k

4000k

6000k

8000k

10000k

12000k

14000k

16000k

18000k

20000kDesktop vs. Mobile Logins

Internet Banking Logins Mobile Internet Banking Logins 7

OUR GOAL IS TO ENABLE A DIGITAL BUSINESS

Smart, secure products/services

E2E process, real-time, highly resilient

Supply chain integration

Insights on complete, accurate, timely data

Culture - innovation, agility, sustainability

Enable a digital business

Measu

res

Enable customers and employees

8

Creating sustainable enterprise outcomesthat help our colleagues win in their markets

Opening up new possibilitiesfor our customers and colleagues

Delivering excellentservices that our colleagues value

Standing behind what we do,and taking accountability for our actions

OUR TECHNOLOGY ORGANISATION’S PURPOSE

Technologyenabling NAB to win

Ideas with impact

High performing and customer focused

people

Smart, integrated, reliable service delivery

Technology’s strategic intent We need to excel at

9

TECHNOLOGY’S THOUGHT LEADERSHIP THEMES

Mobility ↔ Omni-channel

Consumer paymentsSocial &

knowledge economy

Security & trust CloudBig data10

NAB’S CLOUD DRIVERS

And why ODCA has been critical

11

NAB’S TECHNOLOGY DRIVERS FOR CLOUD LEADERSHIP

Business attractiveness

Security and trust

Technical and operational capability

12

NAB’S OBJECTIVES FOR CLOUD

Competitiveglobal market

Cost effective

Choice

Innovation

Risk

Faster, lower cost

Known capability

Agility & innovation

Demand driven

Consistent user requirements promote efficient markets

13

WHY NAB PARTICIPATES IN ODCA

Real world industry experience

Build capability

Engagement of our people

Credibility

14

THE PATH WE’VE TRAVELLED

Could it have been different?

15

Industry context

Nascent

EVOLUTION

Technology Business users

Acquireunderstanding ODCA

Opportunistic buyers

Emerging Controlexpansion Internal cloud

Viral growth

MaturingStrategy

External cloudDiscipline

16

CLOUD STRATEGY

Formation and foundations

17

STRATEGY FORMATION

Objectives:• Articulate NAB’s approach to Cloud adoption• Inform (and educate) stakeholders on the evolving Cloud-scape

Components:• Regulatory Context• Technology Operating Model• Risk Appetite Statement• (Cloud) Sourcing Principles• Cloud Adoption Framework• Governance Arrangements• Practices and Tools

18

TARGET STATE

19Based on ODCA materials

Target State

10% 90%

HYBRID

FEDERATED Foundation servicesRisk Appetite; Readiness Assessment; Architecture & Design; Implementation & Transition; Security; Service Management

REGULATORY & LEGAL CONTEXT

Banking regulation• Applies to “Material” activities for any Outsourcing• Assumes there is a loss of control and therefore risks increase• Requires:

• Policy setting and Board expectations• Diligent selection approach• Formal contract with defined clauses• Regulator access• Consultation or notification• Monitoring and audit requirements

• Other impacting regulations

Privacy Act• Disclosure of personally identifiable information• Mitigation• Emerging mandatory disclosure of breaches

20

TECHNOLOGY OPERATING MODEL

21

LeadershipCapabilities

Engagement, Strategy,Architecture, Innovation

Service Planning, Optimisation & Governance

Service & Relationship Management

External Managed Services

Internal Managed Services

Security Services

Business C

hange

Bus

ines

s Res

ilien

ce

Standardised Infrastructure

Commercial Platforms Bespoke Systems

Multi-Supplier Integration

RISK APPETITE STATEMENTRegulatory requirementBoard endorsedEstablishes the level of risk the organisation is prepared to take to achieve benefits

Set for outsourcing, of which Cloud is one element

Cloud Risk Appetite considerations:• Recognises (external) Cloud is an emerging capability• Sets risk acceptance and control requirements

22

SOURCING PRINCIPLES Consistent with Outsourcing principles plus: Cloud decisions – good governance using ODCA to drive

efficient, consistent, risk balanced benefits based decisions

Cloud service providers – approved suppliers complying with minimum requirements

Ownership and accountability – Technology Service Owner + Relationship Manager if multiple services delivered

23

STRATEGY IMPLEMENTATION

Approaches, practices, and tools

24

CLOUD ADOPTION FRAMEWORK

Low Medium High

Information ClassificationRegulatory/Materiality

Compliance

Low

Medium

High

BCP RatingService Criticality

Informs level of risk assessment, controls and governance

Platinum

Gold

Silver

25

GOVERNANCE – PLAN

Outsourcing regulation

Supplier Council

Risk Appetite Statement

Outsourcing strategy

Board

TechnicalArchitecture Forum

StrategicArchitecture Forum

Cloud strategy

Proponents

26

GOVERNANCE – RUN

Operations

Relationship

Executive• Strategy• Relationship• Opportunity• Escalation

• Performance overview• Risks• Relationship• Innovation• Contract• Escalation

• Performance detail• Issues• Priorities• Improvement• Administration

Supplier Council

27

ADAPTING PRACTICES TO EXPLOIT CLOUD

Service Planning and Management

Software Development Lifecycle

Infrastructure Management

Security and Trust

28

TOOLS

♭♩♪♫

ΔΦ

Segregation of duties

Orchestration

Data residency

Monitoring

Source code management

VPN

API

ScalingResilience

Verification

29

SUMMARY/CALL TO ACTIONCustomer, employee, legacy and industry drivers creating conditions to pursue Cloud services

Engaging with industry, via ODCA, is compellingCloud strategy is a necessary precursor to systemic adoption

The strategy is multi-faceted, requiring organisational change, and investment in tools and practices to be sustainable

ODCA Usage Models provide insight and materials we are leveraging in strategy and implementation

30

© 2013 Open Data Center Alliance, Inc. ALL RIGHTS RESERVED.