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Ifw framework for banking industry presentation

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Ifw framework for banking industry presentation

  1. 1. Information FrameWork (IFW) - A Business Reference Architecture framework for Banking and Financial Services industry Prepared By Ravi Sarkar Solutions Architect/ BPM and Connectivity Prolifics| 114 west 47th St, 20th Flr|NY 10036
  2. 2. ABSTRACT Information FrameWork (IFW) provides the architectural foundation and framework for a set of models developed to support agile, component-based IT systems. Although these models were aimed primarily for the Banking, Finance and Securities industry sector within IBM, the ideas and principles behind the architecture and the model have much wider applicability. The Information FrameWork (IFW) was built upon, but moved away from, the ideas presented by John Zachman in his Framework for Information Systems Architecture now known asby John Zachman in his Framework for Information Systems Architecture now known as Zachman Business Architecture Framework.
  3. 3. Challenges of Financial Industry in a nutshell Agility and Change Management Frequent changes to gain business competitiveness Compliance to Regulations (Dodd Frank Bill for Financial Services Industry, SOX compliance etc. Business Transformation IFW is designed to address all of the above challenges
  4. 4. Challenges in Banking and Financial Services Industry Contn… Banks are challenged with the pace of changes, mergers and acquisitions resulting in disparate systems, the introduction of channel architecture, the development of technologies such as internet banking and telephone banking, the introduction of insurance products into the branch network, and the shift in focus from transactional systems to customer facing systems (e.g. operational single view of customer) have all brought about extensive changes in the way financial services organizations Operate. By necessity, stand-alone solutions have been developed, supported by an array of Individual processes and procedures which often mimic and duplicate each other, but are sufficiently disparate to cause cost and training issues for the financial services organization compounded to the problem. Adding new regulatory components (e.g. Basel II Accord and Sarbanes-Oxley Act) to this Scenario compounds the change management issues, and makes it harder to accomplish business objectives within a reasonable timeframe and at a reasonable cost.
  5. 5. Successful Business Transformation with IFW Process Models The secret to success is the adoption of a top down strategic approach to the transformation of the business that is not constrained by specific technology, particular products or channels or organizational structure. Such a transformation would be a daunting task if undertaken against a blank canvas, and in reality would probably not succeed by virtue of the amount of management input needed and the overall elapsed time to achieve results. The IFW Process Models are a content rich set of models designed specifically for financial services organizations. The models represent “leading practice”, and have been validated through use with many of the world’s leading financial services organizations over several years. They have been enhanced and extended so that the models are aligned with the requirements for risk and compliance and STP payment solutions. The IFW Process Models can be used for a number of different initiatives: Business Transformation (e.g. BPR for post merger/acquisition integration, process centralization and process outsourcing) Regulatory Alignment (e.g. Basel II Accord, Sarbanes Oxley, SEPA and Reg NMS) Process Automation (e.g. the creation of efficient STP payments or account opening processes amenable to automation )
  6. 6. IFW as an Enterprise Architecture Framework in a nutshell Interlinking of this will be explained in the presentation……
  7. 7. Information FrameWork EVOLUTION The ISA framework (more popularly known as the Zachman framework) helps to understand and classify the components that make up an individual application or “system”. Zachman defined information systems architecture in two steps: firstly “by creating a descriptive framework from disciplines quite independent of information systems”, then specifying “information systems architecture based upon the neutral, objective framework”. Information Systems Architecture (ISA) framework consisted of SIX columns (for data, process, network, The Zachman Framework consisted of SIX columns (for data, process, network, people, time and purpose descriptions respectively), and five rows, making a 30 cell grid structure. Shortcomings of Zachman Framework Deficient in showing IT components in a business context, and the business context in a broader management or organizational context. Deficient in simplifying the development of an enterprise architecture by providing an industry reference architecture. Deficient in managing the complexity of change across many interlinked and interdependent pieces. Lacking in component-based design, managing complex changes and reusability.
  8. 8. Objectives, Focus and Approach of the Information FrameWork (IFW) 1. Development of information assets designed for reuse 2. Techniques for classifying information assets 3. Viewing systems development from a fully integrated, holistic, perspective, that covered both the business and the technology perspectives. The reference models and patterns defined in IFW are used to ensure that each step on the transformation process adds architectural value.
  9. 9. IFW was designed to accommodate a variety of different approaches or methodologies providing a comprehensive structure to manage architectures. Research suggests five different approaches for strategic information systems planning (SISP). The five different approaches for Strategic Information Systems Planning (SISP) are: IFW covers this approach through the Business View. IFW provides a number of Routemaps which describe Business-Led - where the emphasis is on the business leading change through business plans and needs, rather than being technology driven. Method-Driven - where the emphasis is on selection of the IFW supports Strategic Information Systems Planning IFW provides a number of Routemaps which describe methodological routes or pathways through the framework. The IFW structure in total supports administration of resources, with explicitly defined responsibilities for governing these resources. IFW covers this approach through the Business and Technical Views. IFW covers this approach through the Organization View. Method-Driven - where the emphasis is on selection of the “best”, formal method. Administrative - where the emphasis is on identification and allocation of resources to meet agreed needs within the firm’s rules, management planning and control procedures. Technological - where the emphasis is on the production of models and blueprints, and planning is regarded as an exercise in business and information modeling. Organizational - where the emphasis is on organizational learning about business issues and information technology contribution, and planning is seen as a continuous decision- making activity the shared by the business and information systems.
  10. 10. Reusable IFW Assets Drive Tangible Benefits • IFW contains industry content that has been proven on hundreds of client engagements, and reflects over 400,000 hours of real world experience • Models support the latest risk and reporting requirements • Significant savings on project analysis and design phases. • Reduces project risk by employing proven content 10 • Reduces project risk by employing proven content and approaches, expressing issues in business terms, and defining scope in manageable phases • More to be added …….
  11. 11. Information FrameWork (IFW) Assets The IFW models provide pre-defined financial services specific templates to accelerate project analysis and design •IFW Process Models provide approximately 80% of the content required for process re-engineering. •The IFW Data Models accelerate data warehouse design for compliance, risk management, regulatory reporting, CRM, profitability and asset & liability management. •IFW Integration Models leverage the IBM software solutions to accelerate the analysis and design of services and components for SOA solutions through the customizable service and class models. •The IFW models provide pre-defined financial services specific templates to accelerate project analysis and design
  12. 12. IFW Value Chains The IBM Information FrameWork (IFW) uses the concept of Value Chains to represent key line of business functions that are supported by a set of long running business processes. Value chains are composed of a set of chevrons, each chevron represents a phase of processing which results in the change of state in the acquisition, creation and consumption of resources for the creation of wealth or value. One or more long running processes occur within a single chevron. Listed on the Value Chains are a partial subset of the recommended IFW Process Model “To Be” templates. 12 Chevron Operational, Credit & Market Risk Management Monitoring, Control and Customer Insight Identify Maintain Service TerminateVerify Establish Identify Potential Customer Identify Customer Identify Involved Party from Role Recommended IFW Process Model “To Be” templates
  13. 13. 1. Lending 2. Sales & Relationship Management 3. Savings, Investments & Deposits 4. Payments 5. Transfer Services IFW VALUE CHAIN 5. Transfer Services 6. Wealth Management 7. Product & Marketing Management 8. Regulatory & Compliance 9. Asset & Liability Management 10.Human Resource Administration
  14. 14. IFW Lending context Administer Review SettleOfferPropose Activate Provide Loan Arrangement Offer Apply Lending Policy Determine Product Conditions Review Offered Arrangement Status Provide Loan Disbursement Modify Arrangement Service Frequency Administer Repayment Collection Provide Interest Rate Change Provide Arrangement Statement Modify Involved Party Details Administer Dispute Resolution Settle Loan Arrangement Administer Business Account Closure Administer Arrangement Termination Administer Legal Collection Determine Arrangement Profitability 14 Provide Arrangement Proposal Gather Customer Details Compare available PD details with Cust. Reqs. Review Proposed Arrangement Status Activate Loan Arrangement Acquire Security Open Business Account Activate Customer Review Loan Arrangement Record Payment Performance History Review Loan Portfolio Schedule Past Due Communication Modify Arrangement Condition Administer Arrangement Suspension Operational and Credit Risk Management Monitoring, Control and Customer Insight Determine Arrangement Profitability Generate Credit Risk Report Generate Operational Risk Report Review Arrangement Safeguard Collateral Provide Past Due Communication
  15. 15. A framework of related business models, describing different aspects of the analysis and design required to support a financial institution IFW FOUNDATION MODELS FSDM FSFM FSWM IFW DATA MODELS BDWM IFW PROCESS & INTEGRATION MODELS IFW PROCESS MODELS The Information Framework (IFW) Building Blocks IFW FOUNDATION MODELS: SCOPING AND DEFINITION OF BUSINESS TERMS IFW PROCESS MODELS: DETAILED ANALYSIS OF BUSINESS PROCESSES IFW INTEGRATION MODELS: 15 BSTs FS-BOM FS-IDM ANALYSIS AND DESIGN OF REUSABLE SERVICES IFW DATA MODELS: ANALYSIS AND DESIGN OF DATA WAREHOUSE AND DATA MARTS
  16. 16. IFW Process Models Relationship Triangle •The Financial Services Data Model (FSDM) •The Financial Services Function Model (FSFM) •The Financial Services Workflow Model (FSWM) There are three individual Models that make up the IFW Process Models-
  17. 17. IFW Financial Services Data Model (FSDM) FSDM is an enterprise-wide classification model. It provides an enterprise-wide view of the concepts and information within the bank and forms the basis of an enterprise-wide information architecture. The fundamental purpose of the FSDM is to enable business concepts to be clearly understood and communicated and as a result help accelerate project scoping. How the FSDM is used: Managing the Enterprise Data Resource Agreeing on the scope of an initiative or application Carrying out impact and gap analysisCarrying out impact and gap analysis Deriving logical specifications Data warehouse planning Benefits of the FSDM: -Provides a predefined, readily customizable enterprise data model. -Provides enterprise-wide definitions of concepts and data. -Forms part of a common language between business and IT -Provides a rapid and accurate scoping tool for new initiatives - saves time and cost. -Reduces data redundancy by providing transparency as to the meaning of data items. -Encourages re-use and consistent data structures across the enterprise
  18. 18. Information FrameWork (IFW)Information FrameWork (IFW) Application ArchitectureApplication Architecture Design Implement INTERFACE LAYER PROCESS LAYER IFW alignment with simple Application Architecture 18 Enterprise Definition &Enterprise Definition & Design…… toto …Rapid Solution Implementation…Rapid Solution Implementation Design Implement Design Implement Design Implement PROCESS LAYER SERVICES LAYER DATA LAYER
  19. 19. Service Oriented Architecture is based on a 3-layer model of “components”, “services” and “processes” BUSINESS PROCESSES INTEGRATIONARCHITECTURE (ENTERPRISESERVCIEBUS) QoS,SECURITY,MANAGEMENTANDMONITORING (INFRASTRUCTURESERVICES) LONG RUNNING INTERRUPTABLE INTERRACTIVE HUMAN AND SYSTEM ROLES ALTERNATIVE FLOWS FOR NON STANDARD CONDITIONS SHORT TERM NON-INTERRUPTABLE SERVICE CONSUMER Layers of SOA 19 SERVICES COMPONENTS NEW / EXISTING APPLICATIONS AND RESOURCES INTEGRATIONARCHITECTURE (ENTERPRISESERVCIEBUS) QoS,SECURITY,MANAGEMENTANDMONITORING (INFRASTRUCTURESERVICES) NON-INTERRUPTABLE SYSTEM ROLES ONLY LOOSE COUPLING COLLABORATIONS OF FINER GRAINED SERVICES PERFORMANCE FAVOURED ABOVE LOOSE COUPLING SERVICEPROVIDER SERVICE CONSUMER
  20. 20. IFW models provide the Financial Services Specific content to accelerate SOA development using business definitions to maximize business benefit BUSINESS PROCESSES SERVICES INTEGRATIONARCHITECTURE (ENTERPRISESERVCIEBUS) QoS,SECURITY,MANAGEMENTANDMONITORING (INFRASTRUCTURESERVICES) SERVICE CONSUMER IFW Processes IFW Accelerates SOA 20 COMPONENTS NEW / EXISTING APPLICATIONS AND RESOURCES INTEGRATIONARCHITECTURE (ENTERPRISESERVCIEBUS) QoS,SECURITY,MANAGEMENTANDMONITORING (INFRASTRUCTURESERVICES) SERVICEPROVIDER IFW FS-IDM IFW FS-BOM BDW & FSDM
  21. 21. The IFW Process Models contain pre-built processes and tasks that cover all the main customer facing activities. Many of the IFW processes need to retrieve full customer details as part of their processing and this example shows how IFW can support this requirement. Retrieve Customer Details One step downstream, the process activity is expressed as a Use Case 21
  22. 22. The Business Scenario – UML Class Model and Use Cases to Support Processes Each step in the IFW Process model that has been identified as an automated step (or service) is represented by an IFW Use Case. The Use Case contains data inputs and outputs. Each data input and output is fully defined in the IFW UML model. IFW Use Case – Retrieve Full Customer Details IFW UML Model – Involved Party 22 Customer details are fully defined and attributed in the Involved Party area of IFW UML model
  23. 23. The Business Scenario – Services Support the Use Cases Each IFW Use Case becomes a Service. The Retrieve Full Customer Details Use Case becomes a Service called retrieveFullCustomerDetails. The Service input and output definitions are taken from the IFW Use Case. IFW Use Case – Retrieve Full Customer Details IFW Service - retrieveFullCustomerDetails retrieveFullCustomerDetails Service 23 retrieveFullCustomerDetails input and output parameters
  24. 24. The Business Scenario – Define Collaborations Based on the Use Cases The internal logic of an IFW Use Case can be expressed in terms of finer grained re- usable services which are represented using the IFW collaboration diagrams. This provides the optimal granularity of services and enables maximum service reuse. IFW Use Case Detail – Retrieve Full Customer Details Retrieve Full Customer Details – Collaboration Diagram 24
  25. 25. WebSphere Banking Content Packs Assets Key Components of Reference Architecture for Websphere Industry Content Packs Industry Capability Models Industry Process ModelsModels Industry Service Models Industry Common Components Industry Business Vocabulary Industry Business Object Models Industry Solution Scenarios
  26. 26. WebSphere Banking Content Packs Reference architecture
  27. 27. WebSphere Banking Content Packs Component details Framework of components in the WebSphere Industry Content Packs The WebSphere Industry Content Packs aim at accelerating the delivery of industry BPM solutions using the WebSphere Business Process Management offering. The framework of components in the WebSphere Industry Content Packs is a logical expansion of a service-oriented architecture (SOA), which promotes loose- coupling of assets for consistency and reuse across business processes. Industry Capability Models This asset is used to provide a hierarchical view of business capabilities and business processes used in an industry. Industry Process Models Industry Process Models are used to expose the application scenarios using well-defined process flows.Industry Process Models are used to expose the application scenarios using well-defined process flows. Industry Service Models The Service Models are used to aid interoperability across diverse platforms for an industry. These Service Models are based on industry standards that provide messaging schemas, which are then used to define the Service Models. Industry Common Components The Common Components includes common services that can be used as-is or can be extended to enable transactional functions. Industry Business Vocabulary This asset is used to provide more information about the relationships between industry-specific terms. Industry Business Object Models This asset is derived from industry standards and serves as an input to the logical data model for a business domain. Solution Scenarios The Solution Scenarios provide a starting point for Proof Of Concept (POC) and solution delivery.
  28. 28. Why License the IFW Models? Significantly Reduce Project Risk Optimise re-use across business process and supporting IT services Ensure quick start based on pre-built models Benefit from experience 28 Significantly reduce analysis and design time and effort while improving quality Benefit from experience of, and lessons learned by, other customers who are also using the IBM Models Benefit from experience and a defined roadmap and approach to successful SOA projects Benefit from a proven models and tools approach supporting the path from analysis through design to implementation Reduce chance of project failure – maximize chance of project success In the next few slides each of these items are elaborated
  29. 29. Significantly Reduce Project Risk •Use of tried and tested “outside” models will minimize contention and enable more speedy decisions Difficulty getting agreement across organizational, product and channel boundaries (politics) Difficulty tying down Business Requirements and getting alignment between Business Processes and supporting IT 29 •Using well structured and fully defined models – across Function, Data, Process and Services (Object / Components) •For example, Activities in the Process Models are expressed as Use Cases in the Object (UML) Models, and are mapped to each other. alignment between Business Processes and supporting IT Services •IFW provides this best practice blueprint for banking and financial services Rationalization / Simplification projects such as those at Citigroup require standards and an enterprise “blueprint” to ensure re-use and cooperation across project teams
  30. 30. Optimize re-use across business process and supporting IT services •For example the IFW Process Models provides: •27 Major Processes •250 reusable workflows •1600 Activities and 2100 triggers •All are fully defined and customizable with support and designed to promote reuse Re-use for Process Modelling requires standards and agreed set of fully defined building blocks to ensure re-use across project teams. 30 •All are fully defined and customizable with support and designed to promote reuse •The IBM Process and Object models are linked and complement each other •Every use case in the IFW Object Model is derived from an Activity in the IFW Process Model with traceability between then •Consistent naming and definitions are used where applicable •This means that there is a quick and easy way to link the activities selected in the process design, and which are appropriate for automation or supporting by a service through to the appropriate use case in the object model. Business Process design is normally handled within the business unit or by a business support group - there needs to be a way to tie this process work and its results to IT Services Analysis and Design.
  31. 31. Ensure quick start based on pre-built models •Build your own while doing the projects •License a customizable model such as IFW An enterprise blueprint or model is required to achieve reuse on SOA projects, choices are: For an organization to build its own models to the strength andFor an organization to build its own models to the strength and completeness of the IBM models, we estimate it would take between 20 and 100 person-years of effort. There are about 31 between 20 and 100 person-years of effort. There are about 500 person-years of experience in the IFW/IAA models currently. Risks inherent with building your own include distractions from the core task at hand, delivering standardized processes and supporting services. Organizations who take the IBM models can immediately start using them on projects and gain all the benefits Saves by other customers include up to 18 months in project re-work and project start up times, and in avoiding project realignment and restarts
  32. 32. Significantly reduce analysis and design time and effort while improving quality •Savings of 40% to 50% in analysis and design time across projects •while improving quality •and maximizing re-use across business processes and IT services. Experience from other projects indicated: 32 •In addition to this - significantly minimized the need for re-work 50% saving applies across analysis and design of both Processes and Services This will rise to 70% or greater as experience is gained and significant reuse is experienced across future projects.
  33. 33. IFW Value Proposition Summary •proven approach and methodology•proven approach and methodology •proven business content and tools integration Risk Reduction - value = up to 10% of overall project cost based on •Based on experience from a number of projects•Based on experience from a number of projectsProcess analysis and design savings - value = 40% saving in this effort •Based on experience from a number of projects•Based on experience from a number of projectsSavings in Use Case analysis and 33 •Based on experience from a number of projectsSavings in Use Case analysis and design effort - value = 50% saving in this effort •Experience shows that lack of models and consistency•Experience shows that lack of models and consistency of approach leads to significant rework and lack of reuse in both initial development and post- implementation support Saving in AD rework and reuse – saving of at least 20 % of this effort •Savings in development of models – harvesting from work – saving = 4 FTEs over 3 years (average)Additional item: Note: Experience from various IBM customers indicated that increased benefits, reduced risk, and rates of savings grow as more projects use IFW.

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