Tech needs to be built to change

David Walker
08:45am October 05 2021

Two years ago, not long after arriving in Sydney, I was out getting a haircut.

As I chatted to my barber, who was probably around 25 years old and happened to be a Westpac customer, our chat turned to banking apps.

After bracing myself, I asked him what he liked about the bank, why he banked with Westpac.

His answer floored me.

“I like what Westpac does for the community, you know, like flying the rescue helicopters,” he replied.  

The insight was powerful – he was describing a purpose-driven bank, a great reminder of the rallying force of a strong purpose.

In fact, recent Accenture research shows eight in 10 consumers say purpose is at least as important to them as customer experience.

For me, a strong purpose is fundamental to driving transformation – anchoring it in something positive rather than the more common motivator of fear of a ‘burning platform’.

We all know great examples. Apple ‘builds products to empower everyone’. Netflix wants to ‘entertain the world’. My old employer, DBS, is fully committed to ‘Making Banking Joyful’.

At Westpac, our purpose is to ‘help Australians and New Zealanders succeed’.

And we know that to help our current and next generation of customers succeed, we need to think differently about our technology, which we need to evolve faster than ever.

Key to our technology transformation in recent years has been the adoption of the ‘built to change’ principle. This requires evolutionary architectures with evergreen technologies. It means being digital to the core and automating everything.

It’s very different to past approaches. Around 30 years ago when I started my technology career, big organisations were building their own software, coding modules designed to inter-operate with each other. But as high-quality commercial off the shelf software became available, we built less and less of our own code, opting instead to buy it.

In the process, a lot of organisations lost many of the skills required to build great software, and ended up with lots of big boulders. That is, expensive, monolithic systems, run by big multi-year programs, supported by large complex teams.

To find a path back, we’ve needed to smash up these boulders.

With our monolithic applications – millions of lines of code – we’re replacing them with small, interoperable microservices, microfrontends and data products, all connected via APIs, managed by our service and data mesh.

The next boulder is our teams. As we move to small applications, we don’t need huge teams. Instead, smaller teams can own these, with the lead engineer able to fit the whole application in their head.

Lastly, massive, long running programs have been replaced by far faster delivery cycles, with quarterly, fortnightly and weekly goals. 

Boulders to pebbles, the results are clear.

For a start, we get genuine reuse. Components, such as APIs and microservices, are being reused an average of three times across the business. This means we can get ideas into production much quicker, because the building blocks already exist.

It also means we can easily ‘plug in’ to the wider digital ecosystems, tapping into industry-leading spaces and innovations.

In addition, our people are much faster. Relative to the legacy ways of working, our developers are producing double the amount of meaningful code as we give them automated delivery pipelines, and support, such as automated testing so they can focus on the fun stuff – coding – rather than the technology plumbing.

To paraphrase technologist Rob Thomas in The End of Tech Companiess: The era of ‘tech companies’ is over; there are now only ‘companies’, steeped in technology, that will survive.

Given banks need to be especially great at technology, we’re in a talent war.

As well as attracting established technologists, including identifying Australians and New Zealanders overseas looking to return home, we’re focusing on the talent of the future, bringing in university graduates and honing their skills.  

Getting the talent in is one challenge. The next is freeing them up to do their thing. This means killing off complexity, the right tooling and automation, distributed accountability, rapid decision making, cutting red tape.

With this technology transformation well underway, the bank has been quietly delivering.

We have reimagined the mortgage experience, using straight through processing and artificial intelligence to offer end-to-end digital mortgages – meaning no paper forms or branch visits for many customers. Around 68 per cent of mortgages are credit auto-decisioned and 70 per cent of customers are accepting documents digitally, and we’ve rolled out first party digital mortgage origination process.

With more than 83 per cent of Westpac customers preferring mobile banking, we have rebuilt – effectively from scratch – our banking app, which now delivers modern, intuitive, simple digital experiences.

We’ve started providing real-time, personalised messages to customers with our state-of-the-art data analytics insight engine, which is built to provide nudges and insights in customers’ best interests.

We’ve also launched our first white label bank as a service in partnerships with AfterPay and Society One, with more partners in the pipeline.

And there’s more to come.

It’s an exciting time, but transformation on this scale is never easy. 

That’s why it’s so important to keep being reminded of why we’re doing it – as my barber very kindly did. It’s all to help our customers succeed.

 

This is an edited version of a speech delivered to FST Media’s Future of Financial Services virtual conference. 

 

 

David Walker

David Walker joined as Westpac Group's Chief Technology Officer in 2019. David commenced his technology career in 1987 as an engineer, coding systems for various Australian based companies. After a decade of evolving his software engineering craft, David founded a consultancy specialising in the use of data, in what is now known as data science. For the last 15 years, David has been in large, complex organisations. He worked in ANZ across a number of executive roles, in both Australia and Singapore. It was in Singapore where David subsequently joined DBS, which transformed from a traditional bricks and mortar bank to be recognised as the Best Bank in the World and the Best Digital Bank in the World by Euromoney.

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