SOA maturity influence on digital banking transformation

• Main Authors: MEGARGEL, Alan, SHANKARARAMAN, Venky, FAN, Terence P. C.
• Format: text
• Language: English
• Published: Institutional Knowledge at Singapore Management University 2018
• Subjects: Digital Banking; FinTech; Legacy Systems; Service-Oriented Architecture; SOA; SOA Maturity; SOA Centre of Excellence; IT Governance; Digital Communications and Networking; Finance and Financial Management
• Online Access: https://ink.library.smu.edu.sg/sis_research/4102; https://ink.library.smu.edu.sg/context/sis_research/article/5105/viewcontent/IJBT_3_Article_1.pdf
• Institution: Singapore Management University

Digital Banking is an evolution of online banking, where the banks attempt to further enhance customer experience by integrating digital technologies such as mobile technology, social media and analytics. Traditional banks have the highest barriers to entry into the digital banking market due to the presence of legacy core banking systems. These legacy systems while still high performing and reliable, are inflexible to change and are not easily integrated to the modern application systems needed for delivering digital banking services across multiple online banking channels. One solution that is widely adopted in the industry to overcome this obstacle is the implementation of a Service-Oriented Architecture (SOA). In this paper weinvestigate the relationship between three factors namely a bank’s technology infrastructure, IT governanceprocesses, SOA maturity, and their impact on time-to-market of digital banking products and services. Ourresearch study is achieved through surveys and case study interviews conducted with the chief technologists from eight banks operating in the Asia. A key conclusion from our study is that SOA maturity plays a very important role in enhancing a bank’s capability towards digital banking Transformation. In order to move towards higher levels of SOA maturity, we make three recommendations; establishing an SOA centre of excellence, implementation of a well architected Enterprise Service Bus (ESB), and adoption of an ESB framework and toolkit.