How would the principles of open source, namely permissive licenses, transparent training data and weights and, perhaps most of all, the ability to contribute to an open source model impact the resulting project?
Photo by Christina Morillo
Open models do exist from many of the most notable players in AI, but they aren’t open source or they impose certain restrictions…and that’s a challenge. To create models that really work for specific enterprise use cases, technology organizations need to understand the full scope of a model – how it was trained, what it was trained on, who contributed to it and so on – before they even think about fine-tuning it with their own internal data.
At Red Hat Summit 2023, we introduced Red Hat OpenShift AI, providing the foundation for running AI models at scale. A powerful, scalable and optimized platform for AI workloads, but not focused on delivering actual models. Today, we’ve made it clear that Red Hat’s strategy doesn’t solely exist in providing the backbone for AI-enabled applications – we want to bring the power of community and open source to the models themselves.
In collaboration with IBM Research, we’re open sourcing several models for both language and code-assistance. But what makes this even more exciting is InstructLab – a new open source project that allows individuals to enhance a model, through a simple user interface. Think of it as being able to contribute to an LLM in the same way you would with Pull Requests to any other open source project.
Photo by Tara Winstead
Instead of forking an LLM, which creates a dead-end that no one else can contribute to, InstructLab enables anyone around the world to add knowledge and skills. These contributions can then be incorporated into future releases of the model. Put simply…you don’t need to be a data scientist to contribute to InstructLab. Domain and subject matter experts (and data scientists too) can use InstructLab to make contributions that benefit everyone. I cannot overstate how powerful this is – both for the community and enterprises!
RHEL AI combines the critical components of the world’s leading enterprise Linux platform (in the form of the newly-announced image mode for Red Hat Enterprise Linux), open source-licensed Granite models and a supported, lifecycled distribution of the InstructLab project. InstructLab further extends the role of open source in AI, making working with or contributing to the underlying open source model as easy as contributing to any other community project.
AI innovation should not be limited to organizations that can afford massive GPU farms or brigades of data scientists. Everyone, from developers to IT operations teams to lines of business, needs the capacity to contribute to AI in some way, in a manner of their choosing. That’s the beauty of InstructLab and the potential of RHEL AI – it brings the accessibility of open source to the often-closed world of AI.
This is where Red Hat’s AI product strategy is going. Our history embodies our philosophy. We enabled the power of open source for Linux, Kubernetes and hybrid cloud computing for the enterprise.
Now, we’re doing the same for AI. Everyone can benefit from AI, so everyone should be able to access and contribute to it. Let’s do it in the open.
Put simply, edge computing is computing that takes place at or near the physical location of either the user or the source of the data being processed, such as a device or sensor.
By placing computing services closer to these locations, users benefit from faster, more reliable services and organizations benefit from the flexibility and agility of the open hybrid cloud.
Challenges in Edge Computing
With the proliferation of devices and services at edge sites, however, there is an increasing amount to manage outside the sphere of traditional operations. Platforms are being extended well beyond the data- centre, devices are multiplying and spreading across vast areas, and on-demand applications and services are running in significantly different and distant locations.
This evolving IT landscape is posing new challenges for organizations, including:
Ensuring they have the skills to address evolving edge infrastructure requirements.
Building capabilities that can react with minimal human interaction in a more secure and trusted way.
Effectively scaling at the edge with an ever-increasing number of devices and endpoints to consider.
Of course, while there are difficult challenges to overcome, many of them can be mitigated with edge automation.
Benefits of Edge Automation
Automating operations at the edge can reduce much of the complexity that comes from extending hybrid cloud infrastructure so you are better able to take advantage of the benefits edge computing provides.
Edge automation can help your organization:
Increase scalability by applying configurations more consistently across your infrastructure and managing edge devices more efficiently.
Boost agility by adapting to changing customer demands and using edge resources only as needed.
Focus on remote operational security and safety by running updates, patches and required maintenance automatically without sending a technician to the site.
Reduce downtime by simplifying network management and reducing the chance of human error.
Improve efficiency by increasing performance with automated analysis, monitoring and alerting.
7 Examples of Edge Automation
Here are some industry-specific use cases and examples demonstrating edge automation’s value.
1. Transportation industry
By automating complex manual device configuration processes, transportation companies can efficiently deploy software and application updates to trains, aeroplanes and other moving vehicles with significantly less human intervention. This can save time and help eliminate manual configuration errors, freeing teams to work on more strategic, innovative and valuable projects.
Compared to a manual approach, automating device installation and management is generally safer and more reliable.
2. Retail
Establishing a new retail store and getting its digital services online can be complex, involving configuration management of networked devices, configuration auditing and setting up computing resources across the retail facility. And once a store is set up and open to the public, the IT focus shifts from speed and scale to consistency and reliability.
Edge automation gives retail stores the ability to stand up and maintain new devices more quickly and consistently while reducing manual configuration and update errors.
3. Industry 4.0
From oil and gas refineries to smart factories to supply chains, Industry 4.0 is seeing the integration of technologies such as the internet of things (IoT), cloud computing, analytics and artificial intelligence/machine learning (AI/ML) into industrial production facilities and across operations.
One example of the value of edge automation in Industry 4.0 can be found on the manufacturing floor. There, supported by visualization algorithms, edge automation can help detect defects in manufactured components on the assembly line. It can also help improve the safety of factory operations by identifying and alerting hazardous conditions or unpermitted actions.
4. Telecommunications, media and entertainment
The advantages edge automation can provide to service providers are numerous and include clear improvements to customer experience.
For example, edge automation can turn the data edge devices produce into valuable insights that can be used to improve customer experience, such as automatically resolving connectivity issues.
The delivery of new services can also be streamlined with edge automation. Service providers can send a device to a customer’s home or office that they can simply plug in and run, without the need for a technician on site. Automating service delivery not only improves the customer experience, it creates a more efficient network maintenance process, with the potential of reducing costs.
5. Financial services and insurance
Customers are demanding more personalized financial services and tools that can be accessed from virtually anywhere, including from customers’ mobile devices.
For example, if a bank launches a self-service tool to help their customers find the right offering — such as a new insurance package, a mortgage, or a credit card — edge automation can help that bank scale the new service while also automatically meeting strict industry security standards without impacting the customer experience.
Edge automation can help provide the speed and access that customers want, with the reliability and scalability that financial service providers need.
6. Smart cities
To improve services while increasing efficiency, many municipalities are incorporating edge technologies such as IoT and AI/ML to monitor and respond to issues affecting public safety, citizen satisfaction and environmental sustainability.
Early smart city projects were constrained by the technology of the time, but the rollout of 5G networks (and new communications technologies still to come) not only increase data speeds but also makes it possible to connect more devices. To scale capabilities more effectively, smart cities need to automate edge operations, including data collection, processing, monitoring and alerting.
7. Healthcare
Healthcare has long since started to move away from hospitals toward remote care treatment options such as outpatient centres, clinics and freestanding emergency rooms, and technologies have evolved and proliferated to support these new environments. Clinical decision-making can also be improved and personalized based on patient data generated from wearables and a variety of other medical devices.
Using automation, edge computing and analytics, clinicians can efficiently convert this flood of new data into valuable insights to help improve patient outcomes while delivering both financial and operational value.
Red Hat Edge
Modern compute platforms powered by Red Hat Edge can help organizations extend their open hybrid cloud to the edge. Red Hat Edge represents Red Hat’s collective drive to integrate edge computing across the open hybrid cloud. Red Hat’s large and growing ecosystem of partners and open methodologies give organizations the flexibility they need to build platforms that can respond to rapidly changing market conditions and create differentiated offerings.
If you haven’t heard of Thunderbird, we wouldn’t blame you. The once popular open source email client has all but faded to obscurity since its last major update. The desktop version is still stuck in the early 2000s. When it comes to mobile, the email client is non-existent. Since its glory days from 2003 to 2005, the email client hasn’t had much of a visual overhaul nor has it made any strides to have a mobile presence of any kind.
That’s changed with a recent tweet from Ryan Lee Sipes, the product manager for Mozilla Thunderbird. In which he noted that his number 1 priority will be to fix Thunderbird’s UI and UX. The change will be a very very welcomed update – this coming from someone who still uses the email client. However, there isn’t a firm date when the big update will be coming. That said, the desktop app is due for its anniversary update on June 28. Could it be one and the same?
Aside from that, it looks like Mozilla is significant progress towards creating a mobile app for Thunderbird. Mozilla has acquired the trademark rights and source code of K-9 Mail on Android. This includes its GitHub repository. Together with all the code and repositories, Mozilla has also hired Christian Ketterer (cketti), the project’s maintainer. What this essentially means is that Thunderbird’s Android app will be built using the pre-existing code from K-9 Mail. Thankfully, this also means that the development timeframe for a Thunderbird mobile app can be significantly shortened.
May take a while to get all the syncing stuff squared. But this is my #2 priority, my #1 is fixing Thunderbird's UI/UX.
It seems like together with the new UX and UI for the desktop application, Thunderbird will also be getting Firefox Sync as feature Mozilla Firefox users will be familiar with. This feature will allow you to sync emails, drafts and more between your different Thunderbird installs on mobile and on desktops. I’m pretty sure that this will be a welcomed development for anybody who finds themselves working on multiple devices.
K-9 Mail is already available on the Google Play Store. So, if you’re interested in contributing to the future of Mozilla Thunderbird, you can install the app as it is updated with features that will be central to the new Thunderbird mobile experience. Of course, if you do use the K-9 Mail app, you will need to potentially brace yourself for multiple UI and UX changes as the Thunderbird team builds on K-9 Mail. Once they’ve achieved their development milestones, the K-9 Mail app will conceivably be changed to Mozilla Thunderbird.
The past few years have shown that enterprises want their applications, data, and resources located wherever it makes the most sense for their business and operating models, which means that automation needs to be available to execute anywhere. Automation across platforms and environments needs a common mechanism with an approach of automation as code, supported by communities of practice and even automation architects or committees to help define and deliver on the strategy.
Per a recent IDC Market Forecast— Worldwide IT Automation and Configuration Management Software Forecast, 2021–2025[i]—“state-of-the-art system management software tools will be needed to keep up with increasing operational complexity, particularly in organizations that cannot add headcount to keep up with requirements.” Managing this overall complexity is no easy feat. As IT and business needs continue to evolve, it’s no longer an issue of “if” organizations turn to automation, but “which” automation tool they choose.
This is where the power of open source technology excels; per the same IDC study, “open source–driven innovation helped fuel the growth of newer players and technologies.” With a community-based, consistent approach to automation, the subject matter experts write the integrations and share them with other teams, building internal communities of practice that can adapt to change and deployments allowing enterprises to get to the cloud at an accelerated pace.
This is how Red Hat, through Red Hat Ansible Automation Platform, approaches automation, delivering tailored innovation for individual platforms combined with a standard, cross-framework language. With the continued shift to consuming public cloud services and resources, the key is to have a platform that allows you to harness the same skills, language and taxonomy that your teams have been using to drive efficiency and savings in on-premises implementations. This approach enables enterprises to achieve what they want, where they want to, in clouds like Amazon Web Services and Microsoft Azure.
Endorsing agility at the edge
We know that enterprises and their needs do not end with cloud automation. Assets at the edge are now just as important and, arguably, even more difficult to manage, than in the data center. Edge computing is critical to business, making automating at the edge non-negotiable. Making all of your existing processes and group components available using a tool like Ansible Automation Platform allows you to move edge management from a multi-person, complex task to one where common components and workflows are used with Ansible for management and integration.
Ansible automation becomes the connective tissue in an IT organization, bridging applications and their dependent infrastructure, and maintaining technology at the edge. IT staff can rely on automation to roll out new services at the edge to meet customer needs with speed, scale, and consistency.
Connecting it all through automation
We often refer to Ansible Automation Platform as the glue between people, process and technology. Automation allows for greater emphasis on strengthening the whole system, rather than just the sum of its parts. The benefits automation can bring aren’t always simple to achieve, but the right framework makes it less challenging. When there’s success at a high level, new ways of working become reality, along with resiliency and adaptability. This formula is precisely what organizations need as they face new challenges to drive modernization and transformation.
[i] IDC Market Forecast, Worldwide IT Automation and Configuration Management Software Forecast, 2021–2025, doc #US47434321, February 2021.
Edge computing is the ability to give life to the transformative use cases that businesses are dreaming up today and bring real-time decision making to last-mile locales. This can include a far-flung factory or train roaring down the tracks, someone’s connected home, or their car speeding down the highway or even in space. Who thought we’d be running Kubernetes in space?
This shows that edge computing can transform the way we live, and we are doing it right now.
Why Collaboration Is Critical
Edge technologies are blending the digital and physical worlds in a new way, and that combination is resonating at a human level. This human resonance might sound like an aspirational achievement, but it is already here. A great example is when we used AR/VR to improve safety on the factory floor.
Continued collaboration, however, is necessary to keep enabling breakthrough successes. Across industries and organizations, we are all highly dependent on one another. Thinking about the telecommunications and industrial sectors, in particular, there is a mutually supportive, symbiotic relationship between these industries—5G development cannot be successful without industrial use cases, which, in turn, are based on telco technologies.
However, numerous challenges remain: reducing network complexity, maintaining security, improving agility, and ensuring a vibrant ecosystem where the only way to address and solve those is by tapping into the collective wisdom of the community.
With open-source, we can unify and empower communities on a broad scale. The open-source ecosystem brings people together to focus on a common problem to solve with software. That shared purpose can turn isolated efforts into collective ones so that changes are industry-wide and reflect a wide range of needs and values.
The collaboration that open source makes possible continues to ignite tremendous change and alter our future in so many ways, making it the innovation engine for industries.
If we collaborate on 5G and edge in this manner, nascent technologies could become exciting common foundations in the same way that Linux and Kubernetes have because when we work together, the only limit to these possibilities is our imagination.
From Maps to Apps and Much More
Do you remember having to use a paper-based map to figure out driving directions? Flash forward to today: Look at the applications we take for granted on our phones or in our homes that allow us to change our driving route in real-time to avoid traffic, or to monitor and grant access to our front doors—to the point that these have shaped how we interact with our environments and each other. Yet not too long ago, many of these things were unimaginable. We barely had cloud technology, we were in the transition from 3G to 4G, and smartphones were new.
But there was important work being done by lots of people who were improving upon the core technologies. The convergence of three technology trends, as it turns out, unlocked a hugely disruptive opportunity: a cloud-native, mobile-device-enabled transportation service that picked you up wherever you were and took you wherever you wanted to go.
This opportunity was only possible because each trend built on the others to create a truly novel offering. Without one of these trends, the applications from the ride-sharing apps of the world would not have been the same or as disruptive. Imagine yourself scrambling to find a WiFi hotspot on the street corner, whipping out your laptop outside a restaurant while standing in the rain, or starting your business by first constructing a massive data centre. The convergence of smartphones, 4G networks, and cloud computing has enabled a new world.
Today we are creating the next set of technologies that will become the things so embedded in our lives and so indispensable to our daily habits that we will wonder how we ever got by without them. Are you ready to be wearing clothes with sensors in them that tell you how healthy you are?
The possibilities with edge technologies are equally as exciting. It starts with the marriage of the digital world with the physical world. Adding in pervasive connectivity—leveraging a common 5G and edge platform—we can transform how operational technologies interact with the physical world and that changes everything.
The Future Is Now
We are creating this new world that is hard to imagine, yet it is not so foreign because we have seen how this story has played out before. Expect these new technologies to have profound implications for humanity—in our daily lives, how we interact with one another, and the social fabric of our world.
We have only to look at how open source has empowered collaboration and how working together has helped people across organizations and industries build more robust, shared platforms more quickly and differentiate on top of them—with apps and capabilities built on the foundation of Kubernetes and Linux, for example.
2020’s gone and it won’t be missed. For all of the chaos, confusion and change the previous year brought, it helped illuminate a critical facet of Red Hat, our associates, our partners, our customers and our communities. It showed that we are resilient. Not only did we weather it as a company, we helped those around us stand firm through the storm. That’s something to be proud of, and I know that as CEO of Red Hat, I’m thankful at how we as a business, as a pillar of the open source community and as a global organization kept a steady hand throughout.
Red Hat was born out of community. It’s at the center of everything we do. When faced with uncertainty and when we see others in need, that’s when we pull together and show our mettle. Throughout the past year, Red Hatters showed a tremendous capacity for fortitude and humanity. When I first took over the role of CEO, I made the comment that I wanted every Red Hatter who was here at that point to still be here in a year. And I think we’ve held true to that.
At the time, that conversation centered on finding work-life balance when the lines became blurred. Without taking care of our personal lives and mental health, we’re not able to meet the needs of our customers. As associates became school teachers and caretakers, dealt with drastically reduced social interactions and grieved the loss of normalcy, they still served customers and helped them be successful. We didn’t just hunker down and wait for the storm to pass; we still moved forward and made ourselves available to help others.
No time to slow down
While the COVID-19 pandemic stalled many industries, the software industry raced forward. Technologies like cloud computing and automation became more important than ever. They are now firmly in the category of must-have, instead of nice-to-have. As a company, we turned our attention to products and services that our customers need to support remote work, expand digital services, scale to meet demand, become more resilient and keep innovating. I attribute our ability to continue to show strong growth throughout the year to this strategy and I’m so proud of the team for keeping the momentum going.
With our biggest announcements last year, you’ll no doubt sense a theme – making sure that our customers can develop and deploy any app, anywhere. They want the choice and flexibility to use the innovations and technologies on a platform that makes sense for the job at hand, and we’re making sure they can do just that. Red Hat OpenShift is the industry’s leading enterprise Kubernetes platform and highlights a future where containers and virtualization, managed consistently across the open hybrid cloud, are helping customers maintain operations while still bringing new products and services to market faster.
We introduced Red Hat Advanced Cluster Management for Kubernetes, a new management solution designed to help organizations exert more consistent control over their Kubernetes clusters across the hybrid cloud — from bare-metal to major public cloud providers and everything in between.
Once they can deploy anywhere, they need to be able to bring those mixed workloads together and that’s where OpenShift Virtualizationcomes in. An integrated component of Red Hat OpenShift, we’re giving customers the ability to manage traditional workloads alongside cloud-native services, letting them prepare for the future while retaining existing investments. This helps to break down technology silos that can slow innovation and impact the customer experience.
For those wanting an increased level of support from us, OpenShift Dedicated is a fully managed service of Red Hat OpenShift on AWS, Google Cloud Platform and Microsoft Azure. We continue to enhance and refine the capabilities of this managed offering, providing an option for organizations looking to reduce the operational complexity of infrastructure management, but still get all the benefits of enterprise Kubernetes. This enables their IT teams to focus on building and scaling the next-generation of applications, rather than keeping infrastructure lit up.
One of the benefits of open source is our close connection to the innovation born in open source communities, where new ideas and concepts emerge and incubate. This is a direct link to IT’s future, enabling us to more readily see trends as they evolve. It’s this connection that enabled us to push the envelope in open hybrid cloud computing, and it’s now providing our launchpad for the next wave: edge computing. Edge brings its own challenges for administrators and developers alike, so we’ve delivered new capabilities for Red Hat Enterprise Linux and Red Hat OpenShiftto help bring edge computing into hybrid cloud deployments.
Coming together
The channel is what made Red Hat. Without our partner ecosystem, Red Hat would be a very different company. We have been successful because of our independence and our work across a broad spectrum of cloud and service providers, including Amazon, Google, IBM and Microsoft. As the saying goes: “actions speak louder than words.” Our neutrality is something that can’t change and you can see it in some of the moves we made this year.
Red Hat and Microsoft have been working to co-develop hybrid cloud solutions for years, which ultimately led to Azure Red Hat OpenShift, the industry’s first jointly-engineered, managed and supported OpenShift service on a leading public cloud. This year we continued our drive as a leading enterprise Kubernetes service on the public cloud with Azure Red Hat OpenShift on OpenShift 4, bringing the power of Kubernetes Operators to Azure along with the flexibility of Red Hat Enterprise Linux CoreOS.
As I’ve said, open source is about choice and about meeting customers where they are, on whichever cloud platform they prefer. With that in mind, we continued our work across the public cloud withRed Hat OpenShift Service on AWS, a jointly-managed and jointly-supported enterprise Kubernetes service on AWS. Red Hat OpenShift is now the common Kubernetes denominator on two of the world’s largest clouds but, most importantly, it’s now easier for our customers to consume OpenShift where it makes most sense for them without sacrificing operational flexibility or service levels.
We’re also seeing the promise of our acquisition by IBM come to fruition, as we scale and work together for powerful world-spanning solutions. Schlumbergerrepresents one of these moments. By collaborating with IBM, this initiative will support its business and provide Schlumberger’s associates global access to its leading exploration and production cloud-based environment and cognitive applications by using IBM’s hybrid cloud technology, built on Red Hat OpenShift.
On the horizon
Just a month in and we’ve already set the tone for the year. All roads, whether it’s through edge computing, serverless or Kubernetes, lead to open hybrid cloud. That’s what we’ve worked to build and where our focus continues to be. We’ve been talking about it for nearly a decade because it’s not just another trend; it’s an enterprise imperative. It’s through the hybrid cloud that we help our customers solve dynamic challenges and keep Red Hat in innovation’s vanguard.
We announced our intent to acquire StackRox, a leader and innovator in Kubernetes-native security. Once the transaction closes, this move will allow us to enhance security for cloud-native workloads by expanding and refining the Kubernetes’ native controls already present in OpenShift while shifting security into the container build and CI/CD phase.
Having a seamless integration between our sales and services strategy and our technology vision is critical to our success, and it calls for the right leader. For nearly a decade, Arun Oberoi has led the team and transformed our go-to-market approach matching our expanding open hybrid cloud portfolio, through strategic acquisitions and new alliances. He will retire later this year and Larry Stack will step into the role of executive vice president of Global Sales and Services. What I appreciate most about him is that he embraces the Red Hat culture and the customer is always the focus. There is a huge opportunity in front of us, as we keep scaling, Larry’s strong experience and the strategic thinking that he brings are going to help us capitalize on it.
Just because we made it out of 2020, doesn’t mean we’re back to business as usual. The pandemic is still impacting the world and organizations are still feeling the effects. The challenges aren’t going away, but we’ve shown resilience and that needs to be a trait that we keep as we move through the year. While 2021 holds many unknowns, one thing that is not unknown is our path forward.
“We live in a time of great change. Thanks to technology, the rate of change around us continues to accelerate,” said Jim Whitehurst, president of IBM. Although today’s banking landscape in Asia-Pacific is proving slow to change, the springboards that could redefine banking are quickly emerging.
One such springboard is regulators issuing digital banking licenses in the region. The Hong Kong Monetary Authority, for example, gave out eight virtual banking licenses last year. Awardees include Ant SME Services (Hong Kong) Limited, Ping An OneConnect Company Limited, Tencent’s Infinium Limited, and Xiaomi’s Insight Fintech HK Limited. Depending on the country, the licenses would allow non-banking entities to conduct banking activities such as taking deposits from retail customers and giving out loans to businesses. Since such firms are not required to have physical branches, they are also called online-only, virtual, or neo-banks. Examples of virtual banks in the region that are already in operations include Tencent’s WeBank in China, and Kakao Bank in South Korea.
These new entrants, together with fintechs, have raised customers’ expectations of banking services. Recent research from independent research firm Forrester found that 77% of Asia-Pacific banking customers prefer to interact with their financial services providers on digital channels, especially in mobile-first countries such as Mainland China, India, Indonesia, and Thailand. Nearly three-quarters of them also believed that they should be able to accomplish any financial task on a mobile device.
As the incumbent banks in Asia-Pacific are finding ways to address those changes head-on, they also need to look at their IT infrastructure, which supports and enables their business models. This is because the IT infrastructure handles the most demanding compute transactions such as trading stocks, bonds, currencies, or derivatives, or allowing retail customers to make purchases using a smartphone app.
Simplifying IT to drive better business outcomes
Established banks today are running on core systems that are often inflexible, expensive to maintain, and difficult to integrate with customer channels. Moreover, while integration is necessary, it is not sufficient to be able to create the technology platform flexibility necessary to lower operating costs, adapt to changes quickly, and optimize customer engagement. To overcome these challenges, banks in Asia-Pacific are working to transform their often monolithic, rigid, legacy IT architecture to a more open architecture that provides the agility to deliver dynamic business needs. This enables them to:
Optimize operations by streamlining processes
Since a single customer record can have various finance-related transactions associated with it, banking systems based on application programming interfaces (APIs) can better service multiple activities associated with a single customer record. Banks can further improve operational efficiency by deploying an API integration tool, which connects externally facing APIs with the internal banking APIs and systems of record. It transforms and directs incoming API requests to the appropriate endpoint within the IT environment, allowing changes to the back-office without impacting customer engagement services.
Additionally, banks can leverage microservices to expose individual functions, facilitating new service implementation as well as existing service updates. A microservices-based architecture can help banks better integrate their services into their partners’ platforms to deliver more services to customers. Since microservices can be reused, they also flexibly support and maintain production services by removing single points of failure in end-to-end flows. To reap the full benefits from microservices, they should be coupled with containers, which enable the portability of decisioning systems, across hybrid cloud environments.
Consistently deliver good customer experience in a standardized way despite changes in the business
Banks were initially built based on the branch office model, and were later supported by call centers and digital channels. These changes call for the IT architecture to be enhanced so that IT can effectively support new business models. However, there might be cases where IT architects missed integrating IT enhancements or new channels with existing operations, leading to data silos.
This is where standards, which can be critical for processing within the back office, can help. They are able to provide a foundation for a uniform system blueprint that gathers more detailed and consistent customer data that can be more easily combined across different transactions and banking channels. Since banks do not have the luxury of shutting down operations to rebuild, applying consistent standards across the board helps to more easily modify processing while still running and maintaining established levels of customer support. API implementation and reuse from shared catalogs can help to enforce adherence to standards and accelerate delivery.
Support business agility through continuous delivery
As change is the only constant, banks need to be able to rapidly develop and modify servicing logic, business rules, and predictive models to adapt to changing customer demands, comply with new regulations, and respond to new competitive offerings. A modern, microservices-based architecture can help banks gain that agility by enabling them to adopt continuous integration and continuous delivery (CI/CD) so that they can build, deploy and manage apps quickly.
Open source will be key to transforming the back-office
As more banks are embarking on the modernization journey to simplify IT, they are harnessing open source solutions to support customer engagement applications and deliver delightful customer experiences. According to The 2020 State of Enterprise Open Source: A Red Hat Report, 93% of IT leaders from the financial services industry globally said enterprise open source is important to their organization, and cited IT infrastructure modernization as one of the top three use cases for the technology. Respondents cited top reasons for using enterprise open source as being able to gain access to latest innovations and achieve higher levels of security.
Thailand’s Kasikorn Bank (KBank) is one bank that has benefitted from enterprise open source. It tasked its tech arm, Kasikorn Business-Technology Group (KBTG), to update and optimize its IT infrastructure to ensure that its mobile banking app is feature-rich, user-friendly and reliable even as the user base grew. KTBG did so by deploying Red Hat’s open source solutions, including Red Hat Enterprise Linux, Red Hat JBoss Enterprise Application Platform (JBoss EAP), Red Hat AMQ, and Red Hat OpenShift Container Platform.
Coupling the tech deployment with DevOps and agile methodologies, KTBG achieved the speed and scale KBank needed such that it can now handle 5,000 transactions per second. The open, modern IT architecture also enabled KBank to easily connect with its business partners’ systems to deliver more features on its mobile banking app, and provided a responsive, reliable application environment that reduced application development time from one month to two weeks. All in all, the changes that are reshaping the financial services industry offer established banks in Asia-Pacific opportunities to adopt technology that can increase their competitiveness and agility. In response to this, banks in the region have enhanced many of their customer-facing front-end operations with digital solutions. However, the front-office experience only makes up a small part of the entire process. Most of the servicing happens on the back end, often using numerous manual touchpoints that are rarely exposed to customers. Having a digital banking platform built on enterprise open source can help banks simplify IT and break down barriers between the customer engagement and back-office teams. With a stable yet flexible platform that can scale and adapt, banks can deliver a streamlined and frictionless customer experience that meets their expectations, therefore cracking the code to becoming successful digital banks that can compete effectively with new entrants.
