Building great digital customer experiences with agile infrastructure

As more business, shopping, and banking is done online and from, well, anywhere, customers increasingly expect high-quality digital-first services that remove the need to go into a physical store or bank.

“People were working from home, shopping from home, banking from home, and are more tech and digital savvy than ever,” says Mike Dargan, group chief digital and information officer for UBS. “And if you look at the financial services industry, the ecosystem is constantly evolving, so it becomes more competitive, open, connected, and location-independent every day.”

Banks like UBS are experiencing a cultural transformation that makes technology itself integral to the business offering. Because technology is often the first—or only—medium via which customers encounter a business, the quality of that digital customer experience is key to the value it provides. To make that digital-first experience a differentiator for a business, Dargan explains, requires strategically and substantially investing in tech throughout the enterprise.

Investing in technology means a targeted focus on the people and platforms behind the customer-facing experiences, not just building out the feature of the month. Dargan’s roadmap begins with engineering excellence—attracting and retaining engineers who want to shape the direction of the industry.

In addition to offering an inclusive culture and opportunities to solve important real-world problems, companies seeking the best engineers must provide cutting-edge platforms and tools to create an industry-leading developer experience. To enable this—as well as to reimagine what they can offer to clients—UBS has made years-long investments in updating legacy systems to new technology, focusing on infrastructure allowing the launch of cloud-native applications on a cloud-native platform.

Internal company processes, though invisible to customers, drive the speed and quality of digital innovation. At UBS, process focus has included training on agile methodologies—teaching employees from all business areas how to get from emerging requirements to high-quality outcomes as quickly and iteratively as possible.

Less obvious longer-term investments in the technology future may also pay dividends both in business terms and in customer experience. In the sustainability space, UBS has partnered with the Green Software Foundation to build software standards and best practices for reducing carbon emissions, and has set a goal of net zero greenhouse gas emissions across its operations by 2050.

Says Dargan, “the world is faster, more digital, and more data-driven than ever before, so clients really do demand services that are digital-first, anytime, anywhere, and are underpinned by first-class technologies. In fact, I’d say tech is really how our clients experience us every day.”

This episode of Business Lab is produced in association with UBS.

Laurel Ruma: From MIT Technology Review, I’m Laurel Ruma and this is Business Lab, the show that helps business leaders make sense of new technologies coming out of the lab and into the marketplace. Our topic is digital-first services in finance and banking. Every company today needs to be a technology company, including banks. The financial industry is constantly evolving, and clients are increasingly demanding digital-first services. To meet those needs, priorities have shifted to invest in technology, focus on hiring, and to retain the best technical talent.

Two words for you, engineering excellence.

My guest today is Mike Dargan, group chief digital and information officer for UBS, and a member of the group executive board. Mike leads the team across technology, real estate, and operations.

This podcast is sponsored by UBS.

Welcome, Mike.

Mike Dargan: Thank you very much. It’s great to be here.

Laurel: So, UBS is focused on making technology a differentiator, and there seems to be a cultural tech transformation taking place inside the firm. How critical is it for IT to literally have a seat at the table?

Mike: First, it’s great to be here, it’s great to be doing this. I think, if we take a step back, tech really is central to our strategy, it is one of our five strategic imperatives. It’s, of course, an enabler, but we want to move beyond that and make it a differentiator. That means technology is an integral part of our business, so a key factor, if you like, for value creation. And to do that, you have to make sure tech has that seat at the table, part of the strategy, part of the dialogue, engaged on topics.

In addition, I would say the world is faster, more digital, and more data-driven than ever before, so clients really do demand services that are digital-first, anytime, anywhere, and are underpinned by first-class technologies. In fact, I’d say tech is really how our clients experience us every day. If anything, COVID accelerated that trend. People were working from home, shopping from home, banking from home, and are more tech and digital savvy than ever. And if you look at the financial services industry, the ecosystem is constantly evolving, so it becomes more competitive, open, connected and location-independent every day.

Laurel: What are those current priorities for you and your team this year?

Mike: First, we’re really accelerating our strategic tech investment. So how do we make tech a differentiator? By, what we call, leveling up technology. That’s what we’re focused on. Now, tech has a number of angles. Whether we think about platforms connecting clients and ideas, second, tools improving our employees and advisors’ efficiency and effectiveness, or third, is actually the culture aspect, so how do we foster accountability? How do we drive engineering excellence?

Leveling up has five key areas of focus. First, Agile@UBS, second, to your intro, engineering excellence, third, QBR and digital roadmaps, fourth, automation, and finally, modern tech. So let me touch on each quickly.

First, agile, how we move into an agile model for the delivery organization. At the beginning of April, 10,000 colleagues moved into our unified agile model, Agile@UBS, that really helps us increase the speed from idea to outcome. By the end of this year, so by the end of 2022, we expect more than 20,000 employees to be working in that model. We’ve developed a playbook, an agile academy, and are transitioning the folks into the model.

Engineering excellence is something I’m really excited about. To really succeed in making tech a differentiator, we have to retain and attract the best engineers. So, we want to really create the best engineering culture in the industry and provide our engineers with a state-of-the-art dev platform. We do want to have fewer, but better and more productive engineers.

Next, QBR and digital roadmap. We manage our tech investment portfolio in a much more strategic and flexible way, so we look at it on a quarterly basis. Already, in the first year, we’ve stopped some large projects, and the QBR has really served as a forum to, if you like, agree on the most important objectives that align with our strategy and ensure we deliver more frequent and valuable outcomes.

Automation—I think automation must be everything we do, everything we think about. It must become, if you like, embedded in our DNA and the firm’s DNA. That starts with the way we develop and develop new technologies throughout the bank. So, whatever we should do, gets automated, and we should automate, if you like, whatever can be repeated. The piece that’s related to that is we’re introducing a new AI data and analytics center of expertise, so ADA, and ADA brings together data scientists and analytics experts from across the firm to make sure we have a consistent, firm-wide approach to these topics.

And finally, modern tech, and modern tech is almost an oxymoron, but the bank of the future does, or will leverage a lean modern tech estate. It must be cloud-based for the applications so that we’re more flexible, we have best-in-class service. So, in 2021, we moved about 1,000 applications to the cloud and decommissioned over 500 legacy applications. If I think back we were 90% mainframe when I joined UBS, we’re now over 50% cloud.

Laurel: And you just joined UBS how long ago?

Mike: I joined in 2016, so over the last five, six years, we’ve been on that journey. So, it’s really a continuation, but with increased focus and pace.

Laurel: That is quite a pace. And just for clarification, QBRs are quarterly business reviews.

Mike: Yeah, exactly.

Laurel: So, how does that pace of constantly reviewing your internal tech portfolio really help you stay on track?

Mike: So, part of that makes sure that we’re focused on the right things, we review the right things. QBR is done in each of the business divisions, it’s done at the GEB as well. We regularly review what we’re doing, we’re reviewing the milestones, we’re reviewing the outcomes. And it just makes sure we’re living agile and breathing agile, because it’s one of the inputs into how we drive agile overall.

Laurel: So, with agile being one of the keys to UBS’s future success, what are some exact examples of this and how is agile specifically helping to make stay ahead?

Mike: I’d say agile really is the way we should be working anyway. If you simplify agile away from some of the terms and so on and so forth, it really is going from requirement to outcome as quickly and iteratively as possible, but with constant quality. So, I think agile working allows us to create products more quickly, and create, if you like, a data-centric and self-service experience for clients.

To your point, I think there’s two examples I’d probably mention where you really see this come to life. In the investment bank ETD platform, we’ve significantly simplified testing and reduced delivery time. Manual testing was slowing us down from delivering the right enhancements to the platform. With the agile approach, so a pod with people from a number of different disciplines automated more than 3,000 tests and reduced testing time from 12 days to just one overall. So, a huge, huge difference.

All for, on our wealth side, so DII, which is direct investment insights, this is one where we directly work on and with client feedback. One agile pod upgraded our investment content by linking that research from the chief investment office directly with trading ideas, so we got the execution on our e-trading platform. Now, this meant that clients’ experience was much better, so content was more easily accessible, it was more timely, they got the notifications on whatever was their preferred communication channel. And actually, in APAC alone, we saw about a 10% increase in clients trading online, and therefore online trading revenues as a result. So huge success, and then, really, with agile it’s quicker, faster, better.

Laurel: Certainly measurable as well.

Mike: Exactly.

Laurel: You mentioned a strong emphasis on fostering an engineering culture and a culture of excellence. What are you doing to further this goal and how are the tech teams responding?

Mike: Without a doubt, our culture is and must be a priority. In many regards, banking is technology, but technology is people. So first off, we have a great culture. I’m super proud of who we are, who UBS is, and how we operate. But nevertheless, I think there’s a few things that we need to do to evolve our culture, so that one, folks can grow and develop, two, they experience new ways of working, three, they’re comfortable being who they are, and really, most important, they feel motivated and inspired every day by what they’re doing and who they’re working with. I think that’s only possible if we really create and nurture the best, most inclusive engineering culture that’s imaginable, that’s possible, and ensure our engineers have a state-of-the-art dynamic platform environment. We want engineers to recognize UBS as a place where they can really work on the cutting edge of tech, help shape the face of an entire industry, and actually have a career that’s got different facets and solve proper problems, so real-world problems for real world people.

Now, I think, how does that look? I think our engineers are embracing change, and at the same time are conscious of the challenge that that brings. Change can be difficult but results really can be cool and amazing. It is a change in culture and mindset, it doesn’t happen overnight. People are used to working in certain ways, and they have to learn to work in a different way and be more agile and using new tools. This takes time, it’s challenging, but actually, we’re already seeing really positive proof points of the roll out of DevCloud, what we’re doing with agile. But it is a transition, it is a change for us, for the organization, for how we work, so some aspects will be difficult, but it is with the right goal.

Laurel: And you mentioned earlier the agile academy being part of that and having 20,000 employees go through that. Now, some tech teams may understand agile, but not necessarily everyone, so is that agile academy focused on the tech teams only, or is it really for everyone at the company to just understand how technology is making the company do different things, and for a reason?

Mike: It’s a great question. Agile is not just for technology, and the 20,000 people is basically the entire change organization at UBS, so that’s both technology and folks in the business and functions who are associated with change. And it has to be both sides. You have product owners, you have others, you have the tech teams, you have the engineers, you have the testers, et cetera, et cetera, and it has to be end to end. There can be agile embraced outside of technology. If you make the super simple definition to be, how do you go from requirement to outcome as quickly as possible? That is agile. How do you do the right stand ups? How do you get people in the right pods, crews, streams, et cetera, et cetera? But it doesn’t have to be agile, it could be recruitment, it could be a whole host of different things.

Laurel: You’ve equated an excellent engineering culture with some pretty significant return on investment for investing in technology, but how does it help your customers? How does it help customer and client experience?

Mike: Ultimately, everything we do is to make UBS better, to make a better client experience, and to support those needs, we do need to attract and retain the best engineers, and make sure they have, as I’ve said, the best-in-class developer experience, and also, build cloud-native applications on a cloud-native platform. If you take an example, which may not sound client-related in some regards, we could take cloud computing. I mentioned some of the stats, but I think it’s been an enabler for our tech growth for a number of years. I think this really is a once-in-a-lifetime opportunity to reinvigorate our estate. It gives greater agility, it prompts us to actually reimagine, to use one of the words from our purpose, how we’ll build our application for our client.

So then if I extend that. Two years ago, we launched DevCloud, UBS DevCloud, which is effectively an open ecosystem built on public cloud, where all our software engineers can have a seamless experience going from dev, to test, to deploy solutions while they’re running. That accelerates time to market, it decreased cost as well, which obviously impacts clients. With DevCloud, we can also constantly improve our apps, so they will never be 10 years old, but instead they will continue to be relevant.

Now, the biggest benefit as well of moving to the cloud is that things that used to take, say, five days, now only take one, which helps boost our engineers’ productivity and makes it a great place to work. We have an expression here we use quite a lot, which is, “All engineers, all developers wait at the same speed.” So, anything we can do to reduce their waiting time is value added. If we have the best engineering talent, if we have the best platforms, we can create the best experience for our clients, in terms of how they engage and interact with us.

Laurel: You mentioned cloud computing, and to create a more definitive timeline here, in late 2018 UBS announced a plan to make the firm more effective and efficient through cloud computing. Then as of February 2021, it was well ahead of that schedule, with 50% of computing happening on private and public cloud. So obviously, a huge transition, if you’re talking, just in 2016, about mainframes, but what has that shift to the cloud allowed the company to do?

Mike: The strategy we set at the end of 2018 was to move, within four-ish years, towards a cloud setup that was a third, a third, a third. So, a third hosted on private cloud, a third public cloud, and a third on mainframe. And we wanted super clear objectives, to try and transition and transform the organization, and how we then progress and what that means. We are ahead of schedule of what we want to do. I also would say our progress in cloud prepared us for the unpredictable, and we’ve seen that through COVID, we’ve seen it through surge volumes, which happened in high vol, due to some of the situations in the world. We need greater capacity in dealing with high trading volumes, and with cloud, you have burst elasticity, because you can burst out for extra capacity. At the same time, we were always able to ensure that business-critical applications are stable, and actually, our availability is above 99.999%. So, the five nines of availability, and that really places us among the leaders in the financial industry.

Also, because we had our cloud-based employees set up, which we call A3, anytime, anywhere, from any device, which is now workspace, we enabled 95% of our employees to work from home. So, we saw more than 60,000 users logged in simultaneously, a huge increase in use of comms tools, so 3 million Skype calls a week. Cloud ultimately makes us more flexible, more stable, more transparent, I think our facilitation with other ecosystems is much easier. All this is great for our clients. It is something I keep repeating, even the piece that seems not client-related means that we can respond faster to their needs and actually maintain security.

Laurel: Part of this initiative across the company to think more strategically about those tech investments, UBS recently joined the Green Software Foundation as a steering member, in part to support the company’s push also for net zero greenhouse gas emissions across all of its operations by 2050. So how does joining the Green Software Foundation affect the choices you make when building and deploying software?

Mike: Yeah, I mean, at a strategic level, UBS is absolutely committed to sustainability, and I think as an individual, but also as a GEB member, it’s a priority overall. We have thousands of applications running across our global business, and I think one of our big steps in our evolution is not just accelerating our digital transformation, but how do we do it in the right way? So how do we use those greener development principles as a huge part, an integral part, of our approach going forward?

We’ve made advances in reducing our carbon emission, and that can be moving from on-prem data centers to the cloud, or reducing, or actually removing idle, power-hungry resources. Now, we’re also looking more and more at whether we can use carbon aware applications and then users can take options with the lowest emission. The Green Software Foundation is a really cool group, partnering with them to share the best practice and knowledge with other members is part of that journey to continue cutting carbon emissions. I think we, with others, can really lead the way here.

Laurel: What technologies are UBS investing in, and when do you look to buy a solution or technology out of the box versus building it yourself?

Mike: I think there’s no right answer here, I think we have to both build and buy, and so we are making strategic investments in select tech startups. So again, let me take a quick step back. About two years ago, so in October 2020, we launched a 200 million strategic investment vehicle, called UBS Next. So effectively, an internal VC firm. Now, that partners with, but also acquires stakes in early stage FinTechs and other tech companies. It’s really got three key priorities. How do we catalyze existing businesses? How do we actually challenge existing businesses? And how do we enhance some of our tech estate overall? Now, obviously, we’re looking for returns on this, but if we can find new and effective ways to engage with our clients and deliver our services, I think this is really interesting.

If I take an example of an investment, we took a stake in Trust & Will in the US. Actually, this platform helps further digitalize and, if you like, personalize an increasingly important aspect of wealth management, which is estate planning. If I do the quick timeline on this, we set it up in 2020, we’ve got a strategic collaboration with Anthemis, which is a VC fund, which I think is one of the best in FinTech investing. In 2021, we took a stake in ConsenSys, which is a software engineering firm in DLT, distributed ledger technology. In 2021 also, we took a stake in Endowus, which is based in Singapore, which is doing digital investment advice. And then earlier this year, Trust & Will. So, I think super simple, our tech strategy only works if we both build and buy.

Laurel: Excellent. Thank you so much, Mike, for joining us today on the Business Lab.

Mike: Thank you very much. This was great to do, I look forward to doing the next one.

Laurel: That was Mike Dargan, group chief digital and information officer for UBS, who I spoke with from Cambridge, Massachusetts, the home of MIT and MIT Technology Review, overlooking the Charles River. That’s it for this episode of Business Lab. I’m your host, Laurel Ruma, I’m the director of Insights, the custom publishing division of MIT Technology Review. We were founded in 1899 at the Massachusetts Institute of Technology, and you can find us in print, on the web, and at events each year around the world. For more information about us and the show, please check out our website at

This show is available wherever you get your podcasts. If you enjoyed this episode, we hope you’ll take a moment to rate and review us. Business Lab is a production of MIT Technology Review. This episode was produced by Collective Next. Thanks for listening.

This content was produced by Insights, the custom content arm of MIT Technology Review. It was not written by MIT Technology Review’s editorial staff.

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