The CIO’s Journey...

Rudi PeetersCIO KBC Grouprudi.peeters@kbc.be

All resemblance to your world will not be a coincidence.Remember: “IT” is too important to leave it only @ “IT”

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Home Markets

HEADQUARTERS

BELGIË

Others: Local branches

New York, Hongkong,

Singapore, Frankrijk etc.

België Tsjechië:

ČSOB

Slowakije:

ČSOB

IerlandBulgarije:

CIBANK/DZI

Hongarije:

K&H

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Stable reference shareholders

KBC Ancora

Cera

MRBB

Other core shareholders

Free float

Share holder structure KBC 9m Customers

3 core segments

Retail & Private Banking

SME

Mid Caps

Employees

total: ca. 37 000

België: ca. 13 000

ICT: ca. 3 000

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Why does “IT” need to be a co-entrepreneur?

Is there a problem?

Why do companies need to become more agile?

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Financial crisis and afterwards

Economy is changing

A shrinking group

Revenues under pressure, more regulations

Investments under pressure

Our challenge: create more value with less costs

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Technology is changing fast

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• India 98%

• China 94%

• Brazil 73%

• Italy 69%

• Germany 67%

• Swiss 66%

• UK 38%

• Netherlands 27%

• Norway 23%

• Denmark 11%

• Sweden 7%

Culture is changing

Should the boss have all the answers?

Belgium

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THE CHALLENGERSTHE USUAL SUSPECTS

THE NEW ENTRANTS THE DISTRIBUTION DISRUPTORS

Competition is changing fast

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Beware of DIGITAL DISRUPTION

There's a well-known story that you

can't cook a frog by tossing him

into a pot of boiling water; he'll

simply jump out.

But you can cook a frog if you

place him into a pot of cool water

and gradually up the heat.

The frog's body temperature will

change with the water temp,

unnoticed by the frog, and dinner

will soon be served.

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What can we do agains disruption?

Challenges for bank or insurance ?

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GM, MERCEDES,…. Versus Google self-driving carTESLA

What can we LEARN out off disruption?

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Where can “IT” be of help?

BECOMING A CO-ENTREPRENEUR

ICT Cost Ratios,

being part of

investment

decisions

IT positioned as

strategic partner

and not as utility

provider

Flexible

organization and

sourcing

Fast

Time-To-Market

Technology as

enabler of new

business value

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12/02/2015

What kind of IT do you want us to be?

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It is not about

the biggest R&D

budget

It is not about

thebest/cheapest

operations

It is all about

Flexibility, Agility,

Readiness to change

It is not about the

best technology

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Need for a flexible organisation

GOVERNANCE

ORGANIZATION

A more continuous IT governance process

based on zero-based budgeting principles

When priorities change, the organization

(staffing) needs to be able to adjust

quickly

A fluid network organization able to react

swiftly to new opportunities and

generating efficiency gains compared to

the current siloed organization

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Moving from a siloed multi-year planning towards a cross-domain continuous governance process

FROM: siloed multi-year planning

• Budget managed per silo.

• Suboptimal priority setting of investments

on company level

• Mainly focus on cost, not on value.

• Budgets fixed 1 year upfront

change

run

change

run

change

run

change

run

BU1 BU2 BU3 BU-X

0%

20%

40%

60%

80%

100%

2QY1 3QY1 4QY1 1QY2 2QY2 3QY2

Free

Allocated

Budget allocation Y2

• Budget managed across domains

• Challenge business cases across domains based on

strategic drivers

• Evaluate business cases on value/risk & close the loop

after delivery of project

• Gradual allocation of budget during the year (taking

“air” out of the budgets)

1 change budget

runrun

runrun

BU1 BU2 BU3 BU-X

TO: cross-domain continuous planning

0%

20%

40%

60%

80%

100%

2QY1 3QY1 4QY1 1QY2 2QY2 3QY2

Free

Allocated

Budget allocation Y2

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From planning, budgeting to organisation.

But if you change or add a budget

YOU NEED TO

Change, add resources to avoid ability to execute

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Moving from a frozen hierarchical organization towards a more fluid organization

FROM: hierarchical organization

• Business–IT: 2 separate teams

• Hierarchical organization

• Rigid structures with FTE norms

• Plan work based on available people

• Waterfall methodology for default

functions

• Non-transparent, entity based labour

market

TO: fluid network organization

• Business-IT together, 1 multidisciplinary team*

• Demand/Delivery process

• Fluid, multidisciplinary network nodes

• Bring right people to the work

• Agile methodology for default roles

• Transparent, cross domain labour market with 1

virtual pool

* Only IT-related business roles in scope

(application mgrs, EUC, project leaders, …)

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Create a fluid network organization

AS IS

“frozen”

TO BE

“fluid”

Zero budgeting, zero invoicing bring people to work instead of work to people

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ANNEX

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Moving budget without moving resources (people)is like buying a car without an engine!

• Governance defines priorities create

workload we have to bring people to work

• 1 project leader / team leader

• Agile is default

• Virtual 1 “flexible” pool cross domain

(development, infrastructure and business)

• Delivery managers

• Demand management

• Transparent internal labor market

• We did not changed organogram or the

organization but we organize our self

different (ignore organograms)

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Competence centers

continuity

flexibility

innovation

Skills competences

THANK YOU