Innovation and Insight in Financial Services

English: Broadway show billboards at the corne...

English: Broadway show billboards at the corner of 7th Avenue and West 47th Street in Times Square in New York City (Photo credit: Wikipedia)

There’s something about New York. The place exudes a sense of purpose. Broadway is the perfect place for a show and it seemed a fitting location for the Celent Innovation & Insight event. The theme of the show was shoot for the moon and even if you fail, you’ll fall among the stars so it seemed fitting that it started with the Star Trek theme tune. Representatives from various companies shared their stories of innovation in both insurance & banking.

The keynote speaker was Richard King, the founder and CEO of Ingenie. Young car drivers pay extortionate rates for car insurance and Ingenie seeks to soften the blow through an innovative combination of telematics (a “black box”) and social media. Backed by some very famous names, the company is just over 2 years old. Gary Lineker, the former England footballer, is Richard’s next door neighbour and he joined by chance when he came round for a cup of tea. Frank Williams of Formula One fame is another backer sharing an interest in telematics technology.

20% of young drivers crash in their first year. 95% of those crashes are down to behaviour. Ingenie works by monitoring driving behaviour and looking for things like sharp braking and fast cornering. Using gamification techniques, good drivers are rewarded and bad drivers are penalised with higher premiums. Should the system detect a potential “license losing event” – the driver gets a black message followed by a call from the firm’s trained psychologists. Half the drivers cancel their policy in response. The other half pull their socks up and behave themselves. For normal insurers the end up losing money on young drivers. Ingenie’s underwriters make money and drivers get reduced premiums. Every one’s a winner.

Their data gives them an interesting insight into the rate of claims. If mum or dad are on the same policy, the chance of a claim is reduced by 13%. If mum or dad engage with monitoring the driver’s behaviour, the chance of a claim is reduced by 25%.

Good old-fashioned paper cheques seems an unlikely spawning ground for innovation. The only reason I still have a cheque book is because the window cleaner won’t accept any other kind of payment! Remote deposit capture using a camera phone has been around in the states for some time. USAA took this a step further and used a combination of video and augmented reality to push the first time success rate up from 78% to 92%. They also had a “Siri for Banking”, only there’s had been christened as Nina. The voice recognition understands roughly 200 questions such as “Tell me how much money I spent last weekend” and “Show me all transactions over $1,000 in the last 30 days”. They hope to make the software more intelligent over time so that they can answer things like “Can I afford a house in this area”.

Bankgirot, a Swedish bank, demonstrated a system that did real-time mobile payments including settlement and clearing in just 2 seconds. UBS talked about an innovative 2 factor authentication system using a combination of NFC and chip and pin.

I thought it was my lack of knowledge about trade finance and cash management that rendered those stories mundane, but as that was the only session where the audience had no questions, I was not alone. Some things are hard to make exciting.

Metlife engineered something called “The wall” which essentially brought data from all their disparate back-end systems into one place modelled on Facebook’s wall. Now in use in all their call centers, the software allows operators to quickly access all the details of their customers and the relationships between them.

A Temenos customer, Commercial Bank of Africa, won a highly commended model bank award and model bank of the year for their M-Shwari solution. Using a combination of the T24 core and M-Pesa for mobile payments with the Integration Framework pulling it all together, they brought banking products to huge unbanked population in Kenya. I collected the awards on behalf of the bank. Unfortunately, one of them could have passed for a deadly weapon which meant necessitated some rather crafty packing on the way home.





Faceless World

Faceless World (Photo credit: Wikipedia)

I am a great lover of new technology, but only when it makes people’s lives easier or more enjoyable. In a connected world, you can find just about any form of goods or services with a google search and a few clicks. That side of life is superb, especially if you are looking for something niche or esoteric. Where I hate technology is when it is used for the sake of it or to keep people at bay.

Sometimes, your enquiry has a bit more nuance than just searching for the right item in the right size and clicking the add to basket button. Sometimes you want to talk through the options with something or someone who has passed the Turing test. The last thing many companies want is for you to speak to a real life human being. Human beings are comparatively expensive, even on minimum wage or on the other side of the world in a sweatshop.

They would rather hide their phone numbers and when you look for more assistance, direct you to a glorified FAQ page with the things that people commonly ask. They are missing the point. The whole reason you want to speak to someone is because you have a question that’s not that common. If it were, whatever it was you sought would be in plain sight.

Sometimes they use a chat mechanism. Despite the message on the website saying there are umpteen agents available, you click to link to open up a session, only to be told that the site is waiting for the next available operator. If there are so many agents available, why do I have to wait? Then, eventually, a window opens and the agent introduces themselves.

“Hello, my name is Derek. How can I help you?”

I feel like typing in “Your name’s not Derek at all. Can you get a real human being to phone me on this number”.

Of course I don’t. I play the game and type in my enquiry. I then wait… and wait. Because “Derek” or whoever it is has loads of different chat windows open talking to many people at once. First you get radio silence. Then you get “Derek is typing a response”. Either Derek only has one finger or he’s a rubbish typist because it takes him ages to type his terse reply in the form of an open-ended question. I appreciate the need for businesses to keep costs down, but I can’t imagine a more detached sales channel.

Surely it’s worth lavishing a little more attention on a potential prospect?

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Danger danger!

Dangerous Risk Adrenaline Suicide by Fear of F...

Dangerous Risk Adrenaline Suicide by Fear of Falling (Photo credit:

There once was a monastery in perched high on a cliff several hundred feet in the air. The only way to reach the monastery was to be suspended in a basket which was pulled to the top by several monks who pulled and tugged with all their strength. Obviously the ride up the steep cliff in that basket was terrifying. One tourist got exceedingly nervous about half-way up as he noticed that the rope by which he was suspended was old and frayed.

With a trembling voice he asked the monk who was riding with him in the basket how often they changed the rope. The monk thought for a moment and answered brusquely, “Whenever it breaks.”

Being scared of heights, I’m not sure I would get in that basket, even if the rope was brand new and 6 inches thick. No-one in their right mind would get into that basket if there was visible wear and tear on the rope. It would be a good idea to inspect the rope regularly and replace it at the first sign of damage. For the really paranoid, you might even replace it every so often with a new rope just in case.

But when it comes to the world of software, it’s a little bit different. People are very risk averse. Even if the software they are running has a known serious defect, they sometimes perceive the risk of taking a fix to be higher than living with the status quo. So let me get this straight, in software terms, you are dangling in a basket hundreds of feet up suspended by a dangerously frayed rope. I’m offering to fit you a new rope, but you don’t want to take it in case there’s a manufacturing defect. Or maybe it might cause a problem with the basket. Why did you even report the problem if you don’t want to take a fix?

It’s not a fair analogy because software is much more complex than a simple basket suspended by a rope. There are many interdependencies. But even so, the risk of doing something always needs to be compared with the risk of doing nothing.  Yes, something might go wrong, but you are in a situation where something is absolutely definitely wrong right now and causing you lots of pain.

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Well? What’s it to be, punk!

English: Santa Claus with a little girl Espera...

English: Santa Claus with a little girl Esperanto: Patro Kristnasko kaj malgranda knabino Suomi: Joulupukki ja pieni tyttö (Photo credit: Wikipedia)

As is traditional at this time of year, we took our nieces to see Santa Claus. The eldest enjoyed it and the youngest is just about over the trauma now. The elf at the front gate confessed to us that more children hated Santa than liked him. Thank Goodness we didn’t go to a Winter Wonderland attraction that recently had to shut down. The attraction sounded great in the promotional material. Reindeer, sleigh rides with real huskies and Santa’s grotto. What could possibly go wrong?

It’s as if the organisers had a checklist. Working to a tight immovable deadline (i.e. Christmas), they just about managed to tick everything off. But because they were running out of time, they had to cut corners. They only had two Reindeer and they managed to look suspiciously like cows with stuck on antlers. The sleigh rides had some real huskies (well 2 to be precise). For some reason, the Santas weren’t available until late in the day. Even when they did turn up, they were thin not fat and their outfits were the cheap see-through plastic kind you get from pound land. The ice rink had no ice. The magic tunnel of ice was a few fairy lights dangled among the trees.

A funny thing happens when you are running out of time and still try to squeeze everything in. Because there isn’t enough time, corners get cut and quality slowly starts its inexorable slide downhill. In this example, the collateral damage was mainly financial, but there will be many children out there for whom the magic of Christmas has been tainted somewhat. But when the same thing happens with software, it can be catastrophic.

When a software project starts to overrun, you have a number of choices. You can slip the deadline (i.e. just accept that delivery will take longer than originally thought). You can slip the budget by putting more people on the project but there is a point where this just makes things worse (read the mythical man month by Fred Brooks). You can slip function (by accepting that you won’t deliver as much). For those who think they can deliver despite the overrun by questioning every estimate and applying pressure, then you end up in Winter Wonderland with only one reindeer and an anorexic Santa.

The default option if you try not to slip anything is quality. And poor quality in software means bugs, glitches & crashes. It also means unhappy clients and unlike Winter Wonderland, most software is around for a very long time.

So what’s it to be?

Are you sure?

Cover of the 1972 Sphere Books English transla...

Cover of the 1972 Sphere Books English translation of the novella and Matryona’s Place (Photo credit: Wikipedia)

“How do you get rid of a database table?” said the disembodied voice of my colleague from beyond the partition.

“DROP TABLE <tablename>” I replied.

“What about if you want to get rid of a whole database?” came the response.

“DROP DATABASE <databasename>” I replied.

After a short pause, my colleague said “Just supposing you’d dropped the wrong database – how do you get it back?”

“You can’t – unless you have a backup.”

“Oh!” he said. “It’s very easy to do isn’t it?”

The thing is, he probably saw a dialog box pop up instantly after he entered the command with those three little words; “Are you sure?” The trouble is, it only takes a heartbeat to read those words and in that brief instant, you are totally sure. After all, you just typed the command. It takes a full 5-6 seconds before you get that “Oh my God!”, heart stopping, toe-curling moment where you realise the size of your monumental cock-up. And by that time, the dialog box is long gone and the machine is busy munching its way through your hard drive.

I don’t know how many dialog boxes we see during a typical working day, but it must be a lot. 99.9% of these dialog boxes will be for something whimsical. Only so often are we doing something of such magnitude that we should pay attention to those three little words. But the trouble is, the dialog looks the same regardless of the consequences.

About to nuke your hard disk with everything on it – “Are you sure?” Of course I’m sure, do it already… Oh shit!

Also – you never get those dialog boxes when you really need them, like when you are about to send a career defining email to far too many people or when you are about to spend a load of money on a present for your wife that she’s going to hate. Or you’re about to wash some white stuff and a sneaky brightly coloured sock has sneaked in.

It would help if these dialog boxes were different in some way. Maybe they could be colour coded to indicate the scale of the consequences. Deleting a single file – no problem, you get a green dialog box. If you are about to recursively delete everything in the root directory, you get a flashing red and yellow dialog accompanied by a suitable sound – like  a klaxon.

Or maybe we could vary the text on the dialog box. We could use lines from famous films. “Go ahead punk, do you feel lucky?” or “I’ll put that down to shock, but only once. Only once can or will I let you get away with that.”

We’d probably still make the same cock-ups, but at least it would be more interesting.

Scunthorpe – where else would you find a naked man running down the high street wielding a machete?

English: A car park from above.

English: A car park from above. (Photo credit: Wikipedia)

“I wouldn’t park there if I were you” said the shifty looking youth in the hooded top.

We looked at each other puzzled; “But it’s a car park.”

“Fridges.” he replied in his thick Northern accent.

Must be something in the water round here; “Sorry – what do you mean?”

“Off top” he said, gesturing to the large tower block overlooking the car park.

“They like using cars for target practise – wit’ fridges.”

Blimey – we could see why this was the home of our shiny new software. It was a town centre monitoring system, hooking up CCTV cameras with alarms, door locks and radio systems across the town centre. After swiftly moving the car to a safer looking parking spot, we headed towards the control centre which looked like a hardened bunker at the nexus of the three tower blocks. Security was very tight and neither of us thought to bring any photo ID.

“We wrote your software. We’re here to see it.”

“Righto sunshine, pull the other one.” said a disembodied voice behind a grille.

We were eager to see the software in action. Although we carried out extensive testing in the lab’, we could only run the system at a small-scale because there were only so many cameras and monitors we could fit on the premises. Eventually, we managed to persuade our vigilant friend that we weren’t fully paid up members of the hooded fridge throwers club and he let us in.

This was back in the late nineties, and the system was advanced for the time. Each operator had a touch screen with which they could navigate over a map of the city. All of the cameras were shown together with their fields of view.

By tapping on a camera, the operator could move it around using a touch screen joypad. Each camera could be made to appear either picture in picture on the operator’s monitor or on a wall of monitors. We even had multiplexer support so that the operator could have many camera pictures showing up in a grid on his monitor.

Built into the system were alarms. When anything triggered an alarm, cameras would go to predetermined positions and appear on predetermined monitors to bring whatever triggered the alarm to the operator’s attention. Right in front of us, an alarm went off and the system sprang into action. It was a real thrill to see the software we created working in anger.

We didn’t have long to admire our handiwork as our vigilant friend ushered us out of the room.

Eventually, the police turned up and we overheard the source of all the excitement. A naked man rampaged down Scunthorpe high street wielding a machete.

Why are babies so rubbish?

Inglesina 3-in-1 stroller without the chassis

Inglesina 3-in-1 stroller without the chassis (Photo credit: Wikipedia)

It’s not like babies are new. They’ve been around for a very long time. It seems to me that whilst other creatures were busy evolving the ability to be born walking or swimming, we hardly evolved at all. Slightly less hairy perhaps with a larger brain cavity, but still utterly unable to communicate or move under our own power at birth.

We’re not even very good at producing them in the first place. If childbirth gets a bit difficult, we reach for a vacuüm as if we’re trying to remove a stubborn bit of fluff from the carpet. Or we reach for a pair of tongs that look like something Herr Flick would use at weekends. Failing that, we slice the unfortunate mother from stem to stern to deliver the baby through the sunroof.

But childbirth looks like the pinnacle of human achievement compared to the progress we’ve made on baby accessories. We don’t have children ourselves, but we spend enough time with young relatives to know our way round a car seat or a pushchair. Why are they so poorly designed?

The wheels on supermarket trolleys are universally derided for being unpredictable at the best of times, so who on earth came up with the idea of basing the front wheels of pushchairs on the same design? Who thought it would be a good idea to have a separate brake for each of the rear wheels? The whole point of having brakes is that you want the thing to stay in one place; not in fact to slowly pivot around the locked wheel.

If the people who made my car can design seats that fold in a zillion different utterly intuitive ways, why do manufacturers come up with such unfathomably enigmatic ways to fold pushchairs? Whoever designs pushchairs should have to test them themselves under simulated real life conditions. First of all, they should have to fold and unfold them in the rain. Then they should have to do it one-handed whilst holding something loud, heavy and wriggling, like a bag of cats maybe. Then they need to repeat the test laden with shopping.

There are many hostile environments in the world, but few can compare to the rigours a baby seat has to go through. Even the nicest design will look disgusting after exposure to a child. You will want to clean it, which means removing the cover. This will prove impossible without putting your fingers into every single nook and cranny. Pray that you put your fingers into something hard and dry. Unfortunately, you are likely to put your fingers into something soft, wet and gooey and pray that it’s undigested.

The ideal baby accessory should be easy to get out, easy to put down and completely jet washable, not unlike the perfect baby.

My mate Larry Ellison

Larry Ellison on stage.

Larry Ellison on stage. (Photo credit: Wikipedia)

Each year I say I’m not going to go this time and each year I end up going. It’s not that I don’t enjoy Oracle Openworld. San Francisco is a fantastic place to visit and the conference, with over 60,000 attendees, is impressive in scale and ambition. But it’s another long haul flight; another weekend up in smoke; another week away from home. Once the novelty wears off, it loses its lustre.

The fact that this year’s conference coincided with the Americas Cup finals in San Francisco bay added more pizzazz and I looked forward to grabbing an opportunity to see the boats. The bay makes an impressive backdrop, with Alcatraz sandwiched between the Golden Gate Bridge and the Bay Bridge (arguably the prettier of the two). The boats make an impressive spectacle, but the race itself is impossible to fathom from ground level. Where it really comes into its own is on a big screen with overlaid graphics showing speeds and the distance between the two boats.

Probably more impressive still is Larry Ellison, the gregarious founder and CEO of Oracle. Just like Steve Jobs, he was both adopted and a University drop out. Today he is the world’s 5th richest man and a self-declared legend. One of the most often hear jokes about Larry; “What’s the difference between God and Larry Ellison?  God doesn’t believe he’s Larry Ellison.”

His keynote speeches are something to behold. Full of superlatives about how amazing his new software, hardware or combination thereof happen to be. These claims are typically outlandish and difficult to disprove. If Steve Jobs had a reality distortion field, he bought it from Larry.

One thing that tickles me is his inconsistency. I remember watching him one year denouncing cloud as a ridiculous fad. The very next year, Oracle were more cloudy than a cumulonimbus! One year, he was on stage with his counterpart from HP telling the world what strong partners they were. Shortly afterwards, Oracle announced that support for HP’s Itanium machine would soon cease. Shortly afterwards they ran a highly publicised cash for clunkers campaign persuading people to trade in HP hardware for shiny new Oracle machines.

There is no doubt who’s in charge. He reportedly cancelled one of his keynotes because it clashed with an Americas Cup race! But my favourite Larry story came from one of my fellow delegates. Apparently he once spoke to Larry and asked him what his favourite exercise was.

“Basketball.” said Larry. “I like to play it on my yacht.”

“But doesn’t the ball keep flying off the side?”

“That’s OK, I have a guy in a speedboat who zips around collecting the balls!”


English: An example of the newly-designed Guin...

English: An example of the newly-designed Guinness glass, put into use in April 2010. It was designed to gradually replace the older tulip-shaped glasses. (Photo credit: Wikipedia)

An excited member of my team once came up to me and told me he’d sped up a subsystem by a factor of 700 times. Once he ran some full system tests, we found that the optimisation had absolutely zero performance impact on any observable aspect of the system. The online requests still took the same amount of time. There was an overnight batch that took almost exactly the same time as before we applied the optimisation. The guy was crestfallen.

How many times have you been on the phone to your bank and the operator says something like “Sorry for the delay Sir, the computer’s really slow today”? Performance problems are an annoyance. Unless things are really bad, you can typically use the system, but it’s slow. We human beings are an impatient lot, so the annoyance level of a system taking 5 seconds to respond instead of 1 is higher than you might expect.

There is some mystique about the performance of a system. With good reason. To really understand performance, you need to understand a hell of a lot about the 1s and 0s that are flying around at the lower level. You need an understanding of what’s happening at the hardware level to make sure there are no bottlenecks there. Sometimes it might be the operating system running out of resources or perhaps the database. It might even be the application code itself. A good performance expert will have many years of experience and an intuitive grasp of what’s going on at every level.

It usually boils down to three different types of problem. Either the tasks in the system are taking too long, or there are too many tasks going on or there is contention.

Suppose you have a bar. Suppose that each time the barman serves a customer, he has to go next door and buy a glass. Each customer interaction is going to take a long time. Adding more barmen is the wrong approach. To fix the performance problem, you need to have a shelf full of glasses that the barman can use whenever a customer places an order. You also need to make sure the shelf gets restocked.

Suppose 20 thirsty people turn up. Now, there is contention for the barman. Cutting the amount of time the barman takes to serve each customer will help, but adding more barmen would probably help more.

Suppose 14 coach loads of thirsty Irishmen turn up on the way back from a rugby match. Now you’ve got a real problem. Not only have you got too many customers to serve, and you have contention on the bar staff, the chances are that a good proportion of them are going to order Guinness (the drink that takes the longest time to serve). To add insult to injury, they’ve probably spent all their money at the match so many of them will also be paying by credit card.

In this example, you’ve got multiple examples of all 3 types of problem at once, which is typically how it goes when you are looking at a complex application. So the next time you’re on the phone to the call centre and the system’s slow, cut them some slack. And spare a thought for the poor sod in the back room who’s trying to work out why.

Don’t get too comfortable…

An artist's depiction of an extrasolar, Earthl...

An artist’s depiction of an extrasolar, Earthlike planet.. (Photo credit: Wikipedia)

All in all, planet Earth is not a bad place, but one day, no matter how much we like it, we might have to up sticks and leave. Maybe we’ll have polluted the place so much that it’s no longer viable to live here. Perhaps the water level will rise so far that there’s no dry land. Or NASA could detect a large foreign body hurtling towards Earth at an alarming rate and Bruce Willis is not returning their calls. Let’s hope it doesn’t involve mushroom clouds.

Read any science fiction novels or watch any films and it’s almost a given that sooner or later, the human race will colonise other worlds. As worlds go, planet Earth is just about perfect. Unfortunately, it’s in the minority. If we want to be choosy about where to migrate to, we need to travel a very long way before we get there.

Unless someone comes up with technology that can move us many orders of magnitude faster than we can today, the only way to get to our new home will be to launch a ship on which people are born, grow old and die many times before the ship reaches the destination. That’s assuming they make it. Space is a hostile environment and there’s no shortage of cosmic debris moving at frightening speeds. A rogue meteor could be the difference between a nice day’s space flight and hard vacuüm.

Not only that, but they will need to pack for every eventuality. Unlike my wife, I can pack for a couple of weeks away  with a case no bigger than a shoebox. If I forget something, it’s easy enough to go and buy whatever I need. When you’ve been in space for 30 years, nipping back home for a new toothbrush or spare parts is impractical.

The crew need to be entertained too. For a long space voyage, half a dozen DVDs are not going to cut it. What are they going to eat? I can imagine that ration packs washed down with recycled urine gets real old real quick. With people cooped up in close proximity for so long, discipline will become an issue. Someone needs to keep the peace.

Depending on the target planet, the journey might be the easy bit. What if we land on LV426?

I do hope that someone, somewhere is quietly working on all these challenges. The time to start trying to solve them is not 72 hours before the asteroid hits.