The Road to an IT Global Operating Model

The Road to an IT Global Operating Model

Keith Dennelly, CIO, Asset Management, Fidelity Investments

Keith Dennelly, CIO, Asset Management, Fidelity Investments

For years, the technology team serving Fidelity Investments’ asset management division was managed as a collection of independent groups that built customized solutions for their respective business areas. It resulted in redundant applications, technologies and data, with new development becoming a smaller portion of the budgets and support costs for the multiple platforms growing. At the same time, the business was moving quickly—launching new investment products, adding trading capabilities, growing internationally—and the legacy platform and decentralized IT organization made it difficult to keep up with demands. As the business continued to grow, it became clear that the model would need adjusting. 

To address the shifting cost structure and strengthen standards, we centralized key roles—including architecture, quality, data management, common platforms, infrastructure and risk—to create strong functional teams capable of meeting our growing business demand. The standardization of common functions allowed us to scale into the large, geographically diverse organization that it is today, encompassing 100 delivery teams and more than 2,000 associates in seven locations, 20 job functions and 80 product areas.  

“The standardization of common functions allowed us to scale into the large, geographically diverse organization that it is today”

By moving to functionally-aligned teams, we risked diminishing the solution delivery focus that had made our business partners successful in the past. In order to tie these new functional teams together, we implemented 11 cross-functional best practices for governing the many projects and services being delivered by our global organization. Today, we call this the IT Global Operating Model. 

With this model, we are able to balance business alignment and functional excellence to meet the demand for high-quality solutions that are better, faster and cheaper. We also remain true to our key tenets of planning, delivery, stability and talent. This model is fundamental to how we manage technology in the Asset Management division. 

Where It All Begins: Strong Functional Teams 

We use strong functional teams to drive standards and methodologies across the organization and to identify opportunities to share platforms, tools, and databases. Functional teams also improve utilization of difficult-to-staff roles by assigning them to top initiatives based on changing priorities.  

Key functional roles include: 

• Business Partner Liaisons: acts as primary point of contact between business and technology 
• IT Strategy and Planning: manages the business of technology 
• Architecture: defines technology standards and practices and drives adoption by all teams 
• Engineering, Quality, and Data: drives engineering and quality practices at the project level 
• Production Services: manages infrastructure, support, security, and risk for all divisions 

 Last but certainly not least, the functional team structure provides career advancement for each function, with rotations, mentoring, and communities of practice.

The Glue: Cross-Functional Best Practices 

At the core of each strong functional team are 11 cross-functional best practices for managing 
end-to-end delivery. These rules of the road tie together the different functions through common methodologies, tools, metrics, and governance. 

1. Product Model: Products are fundamental to how we manage IT—roadmaps, budgets, delivery teams, IT asset management, production support, and more. Product managers play a central role connecting our technology strategies with the front-line activities of our teams.

2.Technology Blueprint: A long-term vision for applications, data and platforms, blueprints guide investment decisions, standardization and reuse across all products.

3.IT Business Management: As with any large, complex organization, IT must be run as a business, with our leaders playing the role of general manager as well as technology manager.

4. Delivery Teams: Dedicated teams that cross multiple roles and geographies to leverage the scale and expertise of our functional organization are critical.

5.Bumper-to-Bumper Quality: Quality is defined not by any single application working in isolation, but by how the whole system functions together—cross-application, cross-product, cross-division.

6. Methodologies and Practices: We tie together methodologies from different functions into a common set of practices for managing end-to-end delivery. 

7. Technology Lifecycle Management: Our IT platform is a dynamic, evolving ecosystem that goes through many stages over its lifespan, from deployment, to maintenance and upgrade, and eventually to retirement.

8. Production Operations: The real work begins once systems have been deployed—user support, monitoring, incidents, tuning, maintenance, change management. There’s so much more to “keeping the lights on” than just keeping the lights on.

9. Information Security and Risk: Protecting the customer’s assets and the firm’s reputation is paramount to everything we do. Through proactive analysis, we work to identify and eliminate potential threats before they can cause harm.

10. Instrumenting the Organization: To create a feedback loop that measures progress against our goals, and to help managers improve their teams’ performance, we deliver actionable metrics and scorecards, because “what gets measured gets better.”

11. Workforce Development: We are building an engaged, productive, and more effective workforce, through Functional Excellence, Product Focus, and Site Sustainability.

 Results Achieved 

Thanks to the IT Global Operating Model, we’ve seen significant improvements in many areas—reduced technology spend, improved time-to-market, better stability and quality, a lower-cost staffing model, and more. Where some organizations may cut deep into their development portfolio when market conditions demand it, we were able to reduce spend by more than 10 percent and maintain a 50 percent development ratio. Organizations also may sacrifice their delivery – time to market and/or quality – when implementing strong functional teams. We were able to reduce average project duration and avoid “runaway projects” thanks to delivery teams and the product model. And where organizations may reduce investment in testing, lifecycle management or automation, we saw a reduction in incidents—in particular change-related incidents—and obsolescence/tech debt even as we reduced spending. 

Looking Ahead

As with any operating model, our IT Global Operating Model will continue to evolve as we strive to meet the ever-changing needs of our business partners and the financial services marketplace. If we look into our crystal ball, this will likely mean moving beyond cross-functional teams toward cross-asset, capability-aligned teams who manage our platforms just like product managers in a successful software company. The bottom line: improving the process may never quite be finished, but we’ve made significant progress, with a talented team. We are excited about the future.

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