GROUP 1

Bikash Shah Arnav Nandy Arpita Nayak Asish Tripathy Avinash Agarwal Bhasker Shrestha Chandan Khandelwal

Agenda
1 minute 2 minutes 2 minutes 2 minutes 2 minutes 2 minutes 1 minute About ING Group + Governance: Corporate and IT
Bikash Shah

IT Road Map + Addressing IT Governance at ING

Arnav Nandy

IT Governance Structure at ING + Who Is Responsible for What

Arpita Nayak

How the IT Dashboard Helps ING + IT Metrics + IT Metrics of ING

Asish Tripathy

Investor's Approach to IT-enabled Business Investments

Avinash Agarwal

Rethinking IT as an Investment Portfolio

Bhasker Shrestha

IT governance matrix
Chandan Khandelwal

About ING

ING Group is a global financial services institution of Dutch origin offering banking, insurance and asset management to 60 million private, corporate and institutional clients worldwide ING employs more than 115,000 people, and 70 percent of its stock is held outside the Netherlands. In today's financial markets the group has a total assets of more than 1.169 trillion The mission of the group is to set the standard in helping the customers manage their financial future

ING aims to deliver financial products and services in the way that their customers want them delivered: with exemplary service, convenience and at competitive prices.

Governance: Corporate and IT

As a part of their corporate strategy, running a business is a well organized activity carried out by professional people who accept full responsibility and accountability for their actions ING is totally dependent on IT, not just for support and enhancing business, but also enabling it. The organisation is reliant upon it 24/7/365 days a year. Without IT, there would be no business.

ING IT RoadMap Highlights

Continue focus on E-business Further benefits realization Leveraging technology for providing solution to business challenges
Customer centricity Distribution Channel Optimization Operational Efficiency Operational Costs Organizational Agility Ensuring Business Continuity Info. security(CIA) Optimizing cost structure New technology adaptation Key Issue Identification (Dashboard reports)

High level issues concerning use of IT Current priorities for IT investment Ensuring IT alignment with business needs

Addressing IT Governance at ING

IT Governance Institute's Board Briefing on IT Governance encourages boards of directors to seek answers to questions such as

How does IT add value to the business?

How often do IT projects fail to deliver what they promised? Does the board have a clear view on how much the enterprise invests in IT compared to its competitors?
It is a responsibility of the members of that board to ensure that the mechanisms are in place to provide answers.

IT Governance Structure at ING

Within ING, a global IT governance structure has been implemented that meshes with its overall corporate governance structure.

This helps ensure the strategic alignment of IT with the business This structure is meant not only to improve the quality of the IT function but also to speed up decision-making

IT Governance Model of ING

IT Governance Model of ING

IT Policy Board: The policy is set by the IT policy board. This policy board consists of

Three board directors OPS/IT portfolio keepers of the three executive centres The director of the Corporate IT (CIT) staff department

IT Leadership Council: It consists primarily of business CIOs who advise the policy board. The IT leadership council has three subgroups dealing with IT standards, IT architecture and IT infrastructure. Information Security Steering Committee: To demonstrate the seriousness that ING applies to information security, there is a separate information security steering committee that also reports directly to the IT policy board

Who is Responsible for What

How IT dash board helped ING

The IT dash board provided the information necessary to: Enable ING, over time, to develop and compare the most appropriate metrics on IT spend, performance and value Enable direct comparison with specifically commissioned, peer group information Enable direct comparison of metrics among different business units Assist senior business and IT management to exercise their governance responsibilities over IT investments

IT metrics
The metrics which are collected and analyzed includes the following: IT costs by category and by activity IT staff numbers and costs analysed by activity Full-time vs. contract IT staff Outsourcing ratios Workstation costs IT intensity (IT costs as a percentage of total operating costs) IT related operational risk incidents (number and value)

IT metrics of ING
The IT metrics of ING helped it in the following way: Have a lower cost base (in terms of the ratio of operating costs to premium income) Spend more on IT Spend relatively more on IT development and less on maintenance Have higher outsourcing levels

An Investor's Approach to IT-enabled Business Investments

ING has successfully mixed banking, insurance and asset management. The organization is mixing the roles of the chief information officer and the chief investment officer. The rewards increase with the risks until one enters the high-risk category. The graph is helpful to explain what parts of the investment portfolio may not bring the level of return that might be expected. It helps to ask the right questions of business sponsors and of IT to identify problems early and take whatever remedial action may be required.

New Development Cost/Revenue Growth

The IT intensity within ING was directly comparable with the high performers. ING operated efficiently in terms of operating cost-to-premium income ratio. ING was well below best-in-class for percentage of expenditure on new developments. ING spent relatively significantly more on legacy system maintenance.

ING took less advantage of outsourcing IT compared to its fellow high performers.

Rethinking IT as an Investment Portfolio

IT

investment how to prioritize Transactional Aim to increase efficiency and to reduce costs Informational Managing and controlling the organization Strategic
o To

increase competitive advantage, enable the entry into new markets or otherwise enhance revenue streams. o Strategic investments do tend to be high-risk but potentially have very high returns.

Infrastructural Is not easily directly quantifiable to financial benefits

Higher

performers invest relatively more in IT projects that fell into the infrastructure and transactional categories higher performers among ING's insurance business units spent 79 percent of their investment budget on projects in these two categories against 60 percent for the lower performers.

The

The

higher performers spent 14 percent of their IT investment budgets on strategic initiatives compared to just 4 percent for the lower performers.

Conclusion
ING

believes the IT dashboard and the IBM/ING research are both very useful Providing knowledge and tools that improve the IT investment process and help to better manage IT expenditure Threefold help

Shareholder return is at least partly related to IT intensity, i.e., how much is spent on IT and how is it spent Best shareholder return is generated by transactional (cost saving) projects because they emphasize standardization and efficiency Creating future revenue growth and to further improve sustainable financial performance for all stakeholders

Taken

some innovative and forward-looking steps toward the achievement of world-class IT governance processes ING is considering the potential benefits to the organization in providing similar IT value and performance services to other organizations as a commercial service

IT Governance Matrix
Decision Domain IT Principles Governance Archetype Input Busines Monarchy IT Monarchy Federal IT Duopoly Feudal CTAC Chairma n and CEO CIO Architecture exception Services IT Catalog Council All CIOs Business Business Leaders Leaders CIO EAO EAO Funding authorization CSS Board CIO Decision Input IT Architecture IT Infrastructure Business Appliation and Strategies Need Decision Input Decision Input IT Investment Decision Investment Committee

Decision Input

THANK YOU