Introducing the main actor of the book
Starting this book, it is important to introduce our main actor. Understanding who is the subject of focus at this early stage is important so you are in a better position to understand our actor’s nature and context, as well as how DevOps as a concept is related. This chapter introduces and outlines the characteristics of the main actor, but also makes reference to other actors that operate in the same industry and ecosystem and have a role to play in the book.
Our main actor is an incumbent bank, representing a sample of global and regional incumbent banks. The incumbent bank in focus is a large institution, well established in the financial services industry, which has the objective of advancing its DevOps adoption on an enterprise level, as part of implementing its new corporate and technology strategy.
Our incumbent is characterized by the following specifications:
- It runs global operations in multiple regions of the world.
- It offers a rich variety of products and services across the banking, payments, and capital markets, asset and wealth management, and the insurance and pension domains.
- It is of regional and global systemic importance.
- It is exposed to different macroeconomic conditions and customer behaviors in the different markets in which it operates.
- Its market share position varies per operating market.
- It has a long history in the industry and is a result of several mergers and acquisitions.
- It historically started to adopt DevOps in several of its units but has not attempted enterprise and at-scale adoption before.
The largest world banks you can think of are represented by our incumbent.
Bonus Information
As a global, systemically important financial services institution, we’ve defined a bank whose failure could result in triggering a global financial crisis. There were 30 such banks in total across the globe in 2021, which we also refer to as too big to fail. Being systemically important indicates that as an institution, you are subject to higher supervisory expectations by the Financial Stability Board.
The incumbent bank operates in the same ecosystem and markets as challenger banks, neobanks, as well as banking infrastructure providers. The challenger banks, neo banks, and banking infrastructure providers are relatively new entrants in the financial services industry, with the following characteristics:
- Challenger banks: New, fully digital, online and mobile banks, without a physical presence, that offer banking products and services under a banking license. Revolut, Monzo, N26, and Lunar belong to this category.
- Neobanks: New, fully digital, online and mobile banks, without a physical presence, that offer limited banking products and services compared to incumbents and challengers without a banking license. Yolt and Chime belong to this category.
- Banking infrastructure and platform providers: These are companies that offer financial infrastructure services through platform integration to both incumbents and challenger banks. Mambu, Banking Circle, Klarna, and Nets belong to this category.
Our incumbent bank’s has relationship to challenger banks and neo banks is characterized by competition, while its relationship with banking infrastructure and platform providers, in most scenarios, is that of a service consumer.
It is important to make reference to another category that is closely related to our incumbent bank – beta banks. These are subsidiaries of incumbents operating under the banking license of the parent bank, or by using licenses of partner banks in specific countries. The business case behind those banks is the fast launch, experimentation, and expansion of new services and products to either existing or new markets. Mettle by NatWest and BforBank by Crédit Agricole are two examples.
Speaking of terminology, it is important to clarify an approach taken in this book. We will refrain from using the term FinTech to identify new entrants in the industry, as we perceive the term FinTech as standing for Financial Technology, which is equally used both by incumbents and new entrants.
