As Hungary’s largest commercial bank, OTP Bank Nyrt. must be efficient not only in the interests of its tens of millions of customers, but also in the interests of its shareholders, and every obstacle must be overcome immediately. This can be helped by agile transformation, in the latest phase of which ShiwaForce Zrt. experts have also contributed to the development of a more streamlined resource allocation system than ever before.
OTP is a huge company: with 40,000 employees, more than 100 subsidiaries and a network covering 11 countries, it is one of the big ones, which makes a change such as agility, which fundamentally restructures the organisation, a huge challenge for the group’s employees. The bank has already embarked on this transformation in 2019, and it is well underway, but not all divisions are affected, with some areas still not agile.
Those divisions that do, however, have moved to quarterly cycles, i.e. they re-prioritise every three months. The divisional teams are formed into so-called tribe units, which are responsible for carrying out specific tasks, and the development needs come from the divisional managers. This is a fairly standard starting point in the world of agility, and it is usually effective, as change can happen faster under pressure from above than when initiated from a lower level. However, it does not always produce sufficient results, because there are so many business lines, so many priorities, which cannot be subdivided.
It was difficult to prioritise
“It’s a long process, and we were never satisfied with quarterly planning,” says Bence Kisfalvi, Director of Agile Methodology and Business Development at OTP. “Relatively quickly we realised that tribe members plan their goals and tasks very thoroughly, but everyone else just runs IT development needs, so we don’t really see what we’re doing for what, at a bank level.”
The development needs are displayed in a virtual marketplace where developers are working on the highest priority tasks. Except that the lists sent by the boards used to be full of immediate development requests, and IT would fabricate a delivery list from these that could hardly be modified afterwards; Bence says the marketplace was inefficient.
“Each customer area had set up its priority list, but we couldn’t consolidate the hundreds of lines of development request lists without specifying and presenting the associated business objectives, so the absolute order between the priority lists was difficult to establish,” he says.
In practice, this means that the aim was to make the planning and delivery processes faster and more efficient, while taking into account the different dependencies. In other words, it could be decided whether an improvement that affects, say, five teams should be taken earlier in the queue than one that affects only two teams, but takes twice as long. Because resource constraints were hidden by the marketplace, many of the top-priority tasks were neatly queued and few were actually solved after the three-month deadline.
We had to face in one direction
In 2021, OTP’s digital division was established, marking the start of the latest phase of its agile transformation. Prioritisation was put at the front of the queue, meaning that business units had to define their business goals in advance and then put the IT development tasks needed to achieve them on the renewed marketplace. The need and the vision had therefore been there for some time – but the help of ShiwaForce was needed to complete the task. OTP started working with the company during the initial agile transition, so it was a given that they would be approached.
Above all, of course, they needed to understand with management where the current system was breaking down. “Obviously, each division head has his or her own point of view the strongest. Not everyone has put the effort into understanding the objectives of all the other areas,” says Bence. “They saw what was in the proposal, so how we allocated the resources, and while that’s great, let’s have these four hundred tasks to be done – everyone said that.” To give colleagues an idea of what the development portfolio was like, Bencé and his colleagues used a scoring exercise to show how much responsibility there was in allocating resources – personally, he experienced this as the biggest challenge in the company and was very pleased that he had managed to get all the OTP’s business units on the same page.
“We can see exactly the impact of improving collaboration in this company,” Bence explains the importance of agility, highlighting the cooperation between professional sectors that do not normally meet. “If you’re only communicating with your colleagues online, it’s very easy to alienate them, but if you’re sitting at the same table, it’s not the same. The key thing about agility is that you can get business and IT colleagues sitting next to each other. They understand each other’s problems, they come up with more effective solutions together – it’s a game changer.”
There was a solution for everything
ShiwaForce came up with a three-component solution: first, the business units’ tasks had to be reviewed and divided into smaller parts, and then a new design methodology had to be developed and trained accordingly. Finally, without any major IT development, to create a management tool that supports real-time reprioritisation – speeding up senior management decision-making in case of a backlog of tasks. RI Consulting was responsible for the reallocation of business unit tasks and the implementation of the first component, with ShiwaForce providing the other two legs.
Bence says that the bank asked for validation from the two companies, and the confirmation was followed by a quick joint operation, which was helped by the fact that both OTP and RI Consulting already knew the ShiwaForce team. The hands-on work started in August, with the target of a December launch, giving the teams two and a half months to complete the transformation. The planning of the tasks lasted until October, when the uploading of the business targets started, of which the company collected 150 in total.
“We managed to dispel several myths,” says Bence. “It used to be that you had to explain why a task was not going well. Now we see that there are five types of resources that are extremely limited, yet everyone uses them. And two of them run out really fast. It became clear that some tasks were not being carried out because of capacity constraints.”
Although 150 requests were added to the list of business objectives to be achieved for the changeover, there are usually 200-300 of them. Two things affect the volume: first, the range of resources, of which the OTP has now focused on the five most often included, although there are 60-70 – but most of these are determined by the five now in focus. The second is the formulation of the tasks, which the more extensive they are, the harder they are to process – this has now been resolved, with the OTP cutting the more massive tasks into smaller chunks.
Big organisation, big challenge
The size of the organisation was the biggest challenge for ShiwaForce. The IT solution was Atlassian’s Jira project tracking software – a reliable, scalable solution that helps make the prioritisation of tasks transparent. Training remained to ensure that OTP staff knew how to use this new system in practice.
“We had a core team that we worked with – obviously their training was the priority, we tested the concept on them, as well as the training materials,” says Bence. “Later on, we were able to roll this out in smaller circles to the whole organisation.” In addition to the usual document downloads and familiarisation sessions, ShiwaForce held twenty-five coaching sessions so that employees could ask questions in person and vent if they didn’t understand something. And speaking of colleagues, although Bence says that the client of the process is senior management, and as such it’s not so much about the operational staff, it’s important that they feel as comfortable as possible.
“A process like this is never a popular thing among operational colleagues, and it’s not necessarily what it should be optimised for. Senior management is the primary client, then it’s the turn of the tribe managers and board managers, because they need to know if the processes are prioritised and moving along.” He adds that a lot of the operational work required can be improved if the right tools are put in the hands of staff at the bank.
According to Bence, the improvements have been well received by OTP’s management and the changes have started a consensus-building debate that could help the organisation’s operations and development in the long term. Bence describes the joint work as smooth: as the person responsible for the project at OTP, he consulted with the participants on a weekly basis on the status of the work and kept management informed when necessary, but as both parties wanted to make the transition as fast and efficient as possible, efficiency was not an issue.
The work continues
And what’s next? For OTP, real-time prioritisation is still an important aspect – the bank says this could be a separate development in the future. “We’ve looked at a lot of things and we’ve got to the point where we can say why this or that won’t work. There are scenarios, but no real solution has been found yet.”
The next step will be to implement this system at group level – Bence says it’s capacity building, the path for which is not yet paved, but as ShiwaForce is a fairly effective partner, they will be counted on in the future.