5 ms·

The problem is technical debt. Banks didn't realize they were software houses, they thought that IT was a tool.

by dsr_ 10y ago

hackits 10y ago
Technically IT is a tool its their to service the business requirements.
- dsr_ 10y ago
  That used to be true - up until sometime in the late 1970s/early 80s. Since then, banks are IT. Take that away and what's left?
  - tmnvix 10y ago
    A banking licence (otherwise known as a licence to print money).
  - lmkg 10y ago
    Made me think of the following Doctorow quote: There are no airplanes, only computers that fly. There are no cars, only computers we sit in. There are no hearing aids, only computers we put in our ears. There are no 3D printers, only computers that drive peripherals. There are no radios, only computers with fast ADCs and DACs and phased-array antennas. http://craphound.com/news/2011/12/27/the-coming-war-on-general-purpose-computation/ http://craphound.com/news/2011/12/27/the-coming-war-on-gener... It's perhaps natural this extends from the computers to the companies that make them: There are no banks, only financial IT companies. There are no TV broadcasters, only media IT companies. Et cetera.
flukus 10y ago
It is amazing how many companies don't think they're software companies, even though they are 100% reliant on their in house software. "We aren't a software company" is even a direct excuse I've heard a few times to justify ignoring technical debt.
- grogenaut 10y ago
  What's worse is companies who 100% outsource to customized versions of a vendor's code. At least banks own the source to what they run even if they can't run it without a license. Clothing company I know sitting next to amazon pays the equivalent of about 5 fte senior amazon engineers a year in licensing the software they run every year to a vendor who charges them another 5 engineers worth to implement all of the customizations they want and "re-negotiates" the contract every 3 years. I say negotiate because there's not really an alternative to switch, it'd be a 3 year conversion project and they refuse to hire devs. They gave a 8k raise to most tech folks about 5 years ago because they were bleeding people across the street. Which brought their senior tech folk to within 20k of an amazon SDE intern salary. People still left. I'm biased as an engineer but I'm not really sure why they keep this relationship going.
  - flukus 10y ago
    This is accountant math with capex vs opex. I don't know how but they manage to convince companies that their saving money by spending 10 times as much.
    - eru 10y ago
      Might still be a good decision: the corporate politics get so much harder, once you have in-house teams. And: that company would probably fail at writing in-house software---most of them do.
      - grogenaut 10y ago
        Good point. I didn't think about the leverage of having an internal team holding you hostage vs and external. And yes there is also the, how do you hire up a good dev team when you obviously don't know how to do software yourself. Eg hiring outside your competency. I know this is especially hard, and I've watched large companies who are good at hiring in general fail at it specifically in a wheel house. I think this is why aqui-hires can help.
rodgerd 10y ago
Banks have always been in the data management business. The first local bank in NZ was set up on the goldfields during the gold rush, and turned gold into data (managed on ledger books). If you got enough gold, you could move to the then-affluent city of Dunedin, and turn the data on your ledger into a house. The tools have changed, but it's the same core expertise: data management.
raesene6 10y ago
From what I've seen there are still a lot of banks who haven't yet realised that they are software houses. Anything that gets outsourced obviously isn't seen as part of the core functionality of the organisation and yet we still see things like 2000 IT staff getting sent over to IBM from Lloyds in the UK (https://www.theregister.co.uk/2017/03/13/lloyds_to_outsource_2000_staff_in_ibm_deal/ https://www.theregister.co.uk/2017/03/13/lloyds_to_outsource...)

The problem is technical debt. Banks didn't realize they were software houses, they thought that IT was a tool.

by dsr_ 10y ago

The problem is technical debt. Banks didn't realize they were software houses, they thought that IT was a tool.

hackits 10y ago

Technically IT is a tool its their to service the business requirements.

dsr_ 10y ago
That used to be true - up until sometime in the late 1970s/early 80s. Since then, banks are IT. Take that away and what's left?
- tmnvix 10y ago
  A banking licence (otherwise known as a licence to print money).
- lmkg 10y ago
  Made me think of the following Doctorow quote: There are no airplanes, only computers that fly. There are no cars, only computers we sit in. There are no hearing aids, only computers we put in our ears. There are no 3D printers, only computers that drive peripherals. There are no radios, only computers with fast ADCs and DACs and phased-array antennas. http://craphound.com/news/2011/12/27/the-coming-war-on-general-purpose-computation/ http://craphound.com/news/2011/12/27/the-coming-war-on-gener... It's perhaps natural this extends from the computers to the companies that make them: There are no banks, only financial IT companies. There are no TV broadcasters, only media IT companies. Et cetera.

flukus 10y ago

It is amazing how many companies don't think they're software companies, even though they are 100% reliant on their in house software. "We aren't a software company" is even a direct excuse I've heard a few times to justify ignoring technical debt.

grogenaut 10y ago
What's worse is companies who 100% outsource to customized versions of a vendor's code. At least banks own the source to what they run even if they can't run it without a license. Clothing company I know sitting next to amazon pays the equivalent of about 5 fte senior amazon engineers a year in licensing the software they run every year to a vendor who charges them another 5 engineers worth to implement all of the customizations they want and "re-negotiates" the contract every 3 years. I say negotiate because there's not really an alternative to switch, it'd be a 3 year conversion project and they refuse to hire devs. They gave a 8k raise to most tech folks about 5 years ago because they were bleeding people across the street. Which brought their senior tech folk to within 20k of an amazon SDE intern salary. People still left. I'm biased as an engineer but I'm not really sure why they keep this relationship going.
- flukus 10y ago
  This is accountant math with capex vs opex. I don't know how but they manage to convince companies that their saving money by spending 10 times as much.
  - eru 10y ago
    Might still be a good decision: the corporate politics get so much harder, once you have in-house teams. And: that company would probably fail at writing in-house software---most of them do.
    - grogenaut 10y ago
      Good point. I didn't think about the leverage of having an internal team holding you hostage vs and external. And yes there is also the, how do you hire up a good dev team when you obviously don't know how to do software yourself. Eg hiring outside your competency. I know this is especially hard, and I've watched large companies who are good at hiring in general fail at it specifically in a wheel house. I think this is why aqui-hires can help.

rodgerd 10y ago

Banks have always been in the data management business. The first local bank in NZ was set up on the goldfields during the gold rush, and turned gold into data (managed on ledger books). If you got enough gold, you could move to the then-affluent city of Dunedin, and turn the data on your ledger into a house. The tools have changed, but it's the same core expertise: data management.

raesene6 10y ago

From what I've seen there are still a lot of banks who haven't yet realised that they are software houses. Anything that gets outsourced obviously isn't seen as part of the core functionality of the organisation and yet we still see things like 2000 IT staff getting sent over to IBM from Lloyds in the UK (https://www.theregister.co.uk/2017/03/13/lloyds_to_outsource_2000_staff_in_ibm_deal/ https://www.theregister.co.uk/2017/03/13/lloyds_to_outsource...)