At IndusInd Bank, adoption of proprietary technologies is being surpassed by pure open source tech

The product space includes keeping tabs on the developments taking place in the area of payments and e-commerce. The element of innovation, being taken up in many financial institutions has a lot of bearing on studying and exploring the potential avenues of strengthening the financial products. Understanding the process end to end across functions is also important. CIOs cannot afford to restrict themselves to having an understanding of just the technology part of the process and being unaware of how the process works in other functions. After product and process comes technology. A thorough understanding and grasp over product and process will help a CIO in taking a decision on whether to innovate with the product or process or both in order to come up with a sustainable innovation that will stand out in the market. It will not be a ‘me too’ innovation.

Moreover, the world of technology is changing fast, so the CIOs have to keep upping the ante on themselves and the team to be on par with the market developments. A lot here depends on the personal inclination of the CIO and the team to learn and be on top of the technology advancements. At the decision making level, the IT decision maker needs to have a general appreciation of the fact that a particular technology can be a potential solution to a problem, and then you can put specialist on the job to ask him to explore in a certain direction.

For example, from a scalability perspective, the openstack technologies are developing big time. They have horizontally and vertically scalable architectures on dockers and kubernetes with self healing capabilities. This area is developing thick and fast. These technologies, at the concept level can be studied fast – in a few days if not hours.

The norm is that CIOs and teams are content with their current understanding and do not want to explore because if the existent systems are running fine and not giving issues, then why fiddle with them. This attitude must go. The reason being, may be the IT decision makers aren’t aware of the per transaction cost of the operating model as it exists today. Is that actually going to be business sustainable.

Growth of IndusInd Bank
The bank over the last ten years has grown from strength to strength focusing on product and process transformation. The bank since the last many years has been able to grow 25 per cent Q-o-Q due to the changes made in products and processes. The bank was an underdog, around 2008. The product and process changes brought about, thereafter, in the light of the digital transformation has given us results. The average balance, holding, cross selling and upselling done to the digitally engaged customer is more than 5X higher than the other average. If this is extrapolated to more customers, it will result in a corresponding increase in the balance sheet. As the bank grew, the cost to income ratio has also been improving Y-o-Y, given the lowering costs per transaction.

Growing usage of hybrid cloud and openstack
Cloud and open source technologies – both pure open source and assisted open source, will play an important role for the CIO in terms of the features offered and the efficiency offered. The bank has adopted a hybrid model of cloud adoption. The fixed workloads are run on premise because its cheaper. The variable workloads, which requires scalability are run on a public cloud, with our own instances.

IndusInd Bank has actively pursued and adopted openstack technology. The time has come, when proprietary technologies are being overtaken by the innovation done by the open source community. Moreover, today supported open source is also available. IndusInd Bank has seen an uptick in open stack and a downward trajectory for adopting proprietary technologies. The growth of its application servers being run on openstack is more than the ones running on proprietary.