ADB’s innovation sandbox is helping it become a more digitally-capable bank | ZDNet

Posted on November 8, 2019 by Design in Design Innovation | 0 Comments

The Asian Development Bank (ADB) was formed with the aim of fostering economic growth in some of the poorest regions in the world.

With that as its charter, ADB’s CIO from the organisation’s office of information systems and technology, Shirin Hamid, said it’s difficult to compare ADB to the likes of other banks when talking about digital transformation.

“DBS for example in Singapore has basically positioned itself as a digital bank, but as a development bank, where our partners and what we deliver is on the ground with countries that are from different landscapes — we have middle income and the least developing countries — are they ready for a bank like us to be a digital bank?,” she said, speaking at Gartner IT Symposium/Xpo on the Gold Coast last week.

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Hamid said she recently had a conversation with ADB’s vice president of finance and risk management centred on determining if ADB was ready to be a digital bank.

“That’s a conversation we’re still having right now,” she told ZDNet.

“The organisation has to take a journey, especially if you come with an organisation that’s brick and mortar. And [for] ours, [which has been] around for 52 years, trying to flip the switch is probably a hard one, and then the question is how do you build all those capabilities that line up to that stage, and that’s the roadmap you have to do with the organisation.”

According to Hamid though, this has not stopped the organisation from experimenting with digital.

ADB stood up a digital innovation sandbox that allows a handful of staff to work through an idea before it becomes an actual product.

It has a project steering committee, led by the VP, comprised of a consortium of heads of departments who determine if an investment is wise and if the idea is something worthy of pursuing.

Each project costs ADB around AU$30,000-AU$50,000 and the steering committee is consulted constantly, Hamid explained.

“We actually go back to the steering committee and they will determine whether we’re ready to pilot that product. Piloting could be a range of timeframes — usually six months to determine if yes, that is the right capability for the organisation — then we’ll determine if we’re ready to scale,” she continued, noting this is where the decision is made that a project will be converted into a business offering.

“That’s where we will use the sandbox but not necessarily believe the final product will be the product that you actually deliver.”

One of the nine projects ADB is currently working on is using machine learning and artificial intelligence (AI) to trawl through troves of data.

“The ADB is about giving loans, grants, and technical assistance to a number of countries. As part of this process, we need to understand what’s the challenge on the ground for us to actually provide that loan,” Hamid said. “To do that analysis, one of the key things [that happens] is to look at and scan the market.”

She said producing a concept paper can take days, weeks, or even months to put together; traditionally, staff would need to scour resources and manually put them together before even proceeding with a concept for a loan.

“Instead of taking weeks or months to actually read all these documents and provide an outcome, what we did was attempt to use AI and machine learning to scan the market, scan external documents, scan internal documents and then determine if we should actually do so,” she said.

“It’s amazing because we actually managed to deliver this product in less than three months and our business users are extremely excited about it … it only takes a day for the machine learning tool to actually read the documents and then present it.”

Asha Barbaschow travelled to Gartner IT Symposium/Xpo as a guest of Gartner.