Capital One Europe CIO Rob Harding interview – A six-point master plan to fuse financial services with technology

With over $25 billion in revenue last year, and more than 45,000 employees worldwide, Capital One is a huge financial services company. But while most of its employees are based in the US, it has a growing European operation which is headquartered in Nottingham, with additional offices in London. CapitalOne Europe CIO Rob Harding has been continuing to work on a plan that started at the back end of 2013, when the firm appointed a new head of international business.

“He wanted to effectively position our business at the intersection of financial services and technology,” says Harding.

This was an exciting opportunity for Harding and his team, and they have been working on a six-point plan to put technology at the heart of everything the firm is trying to do for its customers in the UK.

The first point was to create a more adaptable business as part of a digital transformation agenda. In order to do that, Harding and his team had to rethink how specific jobs were grouped together. From a technology perspective, this meant a reinvestment in engineering, an area which had been outsourced for a number of years.

“I wanted to build a software engineering competency within our UK business, and partner that group up with two new job families; one around human centre design, and another around product management – those would form the epicentre of all of our product development moving forward,” he said.

This was a switch from the traditional lines that the firm had; an IT group, a marketing group and an operations function. But Harding explains that while those functions still exist, what has changed is how the company takes ideas to market.

“It is much more a function of the matrixed organisation; how you build co-located teams from across the business to put an idea to market,” he says.

The second point of the six-point plan involved Agile transformation, which began with software delivery and eventually spread out to all of the company’s technology delivery. Now, Harding says that many of Capital One Europe’s principles of Agile have been implemented in the way the business works – even outside of the technology group.

But Harding emphasises that not all Agile methodologies can be used everywhere – scrum, for example can work when the company owns the software asset, but when it relies on third party or licensed software, Capital One Europe tends to use Kanban instead.

“Kanban is a useful tool because it’s a blend of aspects of scrum but also allows you to handle longer pauses in the delivery cycle more akin to waterfall,” he says.

Waterfall is still used for some projects too, such as Capital One’s move to its new premises in London.

“Overseeing the build of that is being managed in a Waterfall way, and some of the technology components such as Wi-Fi installation is all waterfall, but where we’re building product development it is Agile; we choose the methodology that reflects the most pragmatic approach to market,” he says.

This strategy has been implemented rather than a two-track approach, because Harding believes that he has seen companies who have tried and failed with that particular method; with two tracks eventually turning to three, or incorporating an additional ‘firelane’.

The other focuses for Capital One Europe are on data and analytics; a move away from large refreshes and upgrades of monolithic applications to more modular microservice cloud-based architectures; the ability to tap into existing software assets that are available in the US-side of the business and the use of open source software where applicable.

The sixth point of the plan is centred on culture.

“This is such a complicated and overlapping set of transformations across the five other points that you need a culture which can absorb change on a continuous basis and actually thrive through that intense period of change,” Harding says.

He adds that it will take a few years to know whether this transformation will ever be declared as complete, or whether it has to be an ongoing transformation in order to succeed.

Reaping the rewards of agile

Capital One Europe’s QuickCheck product, which allows customers to check if they are eligible for a credit card without affecting their credit rating, wouldn’t have come about if it wasn’t for the firm’s Agile transformation, according to Harding.

“It was borne out of a stand-up meeting; someone had an idea which was discussed and then it was prototyped, we put a fairly low fidelity version of it out into the market and then we refined it over a period of time – it would have never gone out in 2013 because of the traditional way we had been working,” he states.

All-in with public cloud

Capital One has some big investments in all lines of its business around moving more of its production workload to the public cloud – it signed a deal with Amazon Web Services last year, and Harding believes that the shift to public cloud will give the company various benefits.

“It will give us a velocity benefit, and the way you can create environments in the development and test side gives you time-to-market advantages, while some of the native tooling gives you more acceleration, and I like it for being able to create a stable customer experience,” he says.

Harding also suggests that he likes some of the security aspects of public cloud, such as the way the data is encrypted, and he believes that the public cloud can be used to create a more secure environment.

“I’m excited about our journey of moving more of our production workload to the public cloud, but I’m not sure if we will move all of it there; I’d love to be able to switch the lights off in our data centre in Nottingham but I think that’s still a number of years away – possibly by 2022,” he suggests.

Up-skilling, reskilling and recruiting

As part of the company’s transformation, it is inevitable that it will require new types of skills, particularly in the technology group.

The UK-based firm has 250 technology-related employees, most of whom are based in Nottingham, and it has a growing team in London too. It intends to shrink the reliance on third party teams, and hire 128 people within a 12-month period, most of which will be based in London.

The aim, according to Harding, is to have two independent but integrated technology hubs.

He has already hired 58 people and has 70 more people to hire this year to hit his recruitment target. Software engineering is the most sought after IT skillset at Capital One Europe, while there is a big investment in cyber security skills too. Harding says that there is also a need for some cloud-related expertise but that this is being satisfied by retraining and giving existing employees new opportunities.

As for his own role, Harding says that his remit changes on an annual basis as a result of the constant changes in the organisation. However, he says that the organisation as a whole is now taking a lot more responsibility and accountability for delivery rather than relying on the technology group.

There is evidence of this with a lot of shared responsibility across digital transformation across the whole of the firm’s executive team.

“If a company is doing digital transformation well then the CIO shouldn’t be the sole person leading the particular charge; you want digital transformation to be federated across your executive team if you want to make a success of it,” he says.

Meanwhile, Harding believes the CIO role will be around for a long time to come, but that the chief digital officer role could disappear over time.

“We don’t have a CDO in the UK business and I don’t feel that we lack the expertise but I think some organisations need it because they need someone with that expertise for a point in time. However, if the role is done well it evaporates over time,” he says.