David Gledhill, CIO13

1. #CIOEdge #ADAPT @ADAPT Ventures
Global Guest Keynote
DBS Bank Case Study:
Executing the
Digital Strategy
David Gledhill
Group CIO & Group Executive,
MD & Head, Group Technology
and Operations (Singapore)

2. Executing the digital strategy
1
The presentations contain future-oriented statements, including statements regarding the
Group’s vision and growth strategy in the light of anticipated trends as well as economic
and market conditions. Such statements necessarily involve risks and uncertainties,
which may cause actual performance in future periods to differ from projections.
Dave Gledhill
CIO and Head of Group Technology & Operations
21st Feb 2018

3. DAVE@DBS
Not Australian! Computing
& Electronics
1st job –
OS development
20+ Years
9 Years
Reimagine
DBS
Lead 10,000
colleagues
20 Years
3 kids!

4. 2009 – 2014: Looking good… but?
Net Profit 13% CAGR1
Income 8% CAGR1
Group income
(S$m)
9,618
6,603
ROE to
8.4%
2009
10.9%
2014
1 2009-2014
3
2009 2010 2011 2012 2013 2014

5. …the world was changing around usGlobalisation of Platform Giants
Cost vs Efficiency to Scale Up
Source: CB Insights
Start-ups Unbundling Banking
4

6. What would
Jeff do?
5

7. Our digital business model: 5 key capabilities
ECOSYSTEMS: Pipes to Platforms
DATA: Be insights driven
TRANSACT
• Eliminate paper, create instant
fulfilment
• Decrease cost
ACQUIRE
• Increase customer acquisition
through wider distribution
• Lower acquisition cost
ENGAGE
• Drive ‘sticky’ customer
behaviours, cross-sell through
contextual marketing
• Increase income per customer
6

8. EMBED OURSELVES
IN THE CUSTOMER
JOURNEY
BECOME DIGITAL TO THE
CORE
CREATE A
22,000 START-UP
7
Driving the transformation: Making Banking Joyful
Make DBS ‘Invisible’

9. EMBED OURSELVES
IN THE CUSTOMER
JOURNEY
BECOME DIGITAL TO THE
CORE
CREATE A
22,000 START-UP
Phase 1
Fix the basics
(2009 – 2014)
8

10. 9
*Image source: cnet.com

11. These foundation years were critical building blocks
Start insourcing and
build engineering
bench strength
Security operations
centre
Monitoring
centre
Data Centre
revamp
Build
resiliency
10

12. Our application stack in 2009 needed a lot of work
Teller
Internet & Mobile Banking
Corporate IB
CRM
Customer
CASA and FD
Private banking
Liquidity Management
Remittances
Unsecured loans
Secured loans
Trade Finance
Factoring
Markets
IBG MIS
Credit Approval
Finance
Singapore Hong Kong Taiwan Indonesia ChinaIndia
Overseas
Branches
Buy Hold Sell Review
CHANNELSPRODUCTS&SERVICESENABLERS
11

13. Teller
Internet & Mobile Banking
Corporate IB
CRM
Customer
Private banking
Liquidity Management
Remittances
Unsecured loans
Secured loans
Trade Finance
Factoring
Markets
IBG MIS
Credit Approval
Finance
Singapore Hong Kong Taiwan Indonesia ChinaIndia
Overseas
BranchesCHANNELSPRODUCTS&SERVICESENABLERS
And by 2014, we had fixed the basics and were ready
to build a digital bank
Buy Hold Sell Review
CASA and FD
12

14. EMBED OURSELVES
IN THE CUSTOMER
JOURNEY
BECOME DIGITAL TO THE
CORE
CREATE A
22,000 START-UP
Phase 2
▪ Increase velocity
▪ Leverage on new
technologies
(2014 onwards)
13

15. We went to deeply understand how the technology-driven
giants built and operated
14

16. Technology transformation occurred to achieve cloud scale in
data volume, processing and change velocity. Although the
business needs & transformation journeys vary, these
companies arrived at the same end-state ideal architecture
2000 2010 20152005
Drivers
6 years
4 years ▪ Cloud scale data volume
▪ Cloud scale data processing
▪ Unstructured data processing
▪ Complexity of environment
▪ Dependent on 3rd party vendor
▪ Deep level instrumentation
▪ Protection against outages
▪ Complexity of environment
▪ Change velocity
Jan ‘16 – shutdown
last DC
❖ Expensive and complex architecture
❖ 3 days to compile an application binary
❖ Full day web site inaccessible
❖ Coincide with 7 percent drop in stock price
❖ First quarterly customer loss
July ‘07
❖ Inability to support cloud scale with current enterprise technology
❖ Need to handle unstructured data
An outside-in look at the industry technology
journeys (of Gandalf)
7 years
3+ years
❖ Support rapid change
- CI, CD, digital bank
Our journey so far
▪ Cloud Scale
▪ Improved Speed
▪ Improved Resilience
▪ Open Source (e.g. MariaDB, Hadoop,
Spark, etc.)
15

17. Being the in
16

18. We embarked on a strategy of 5 key elements to drive change
throughout the organization
17

19. 18

20. Gandalf Transformation Targets by 2018
Become Cloud
Native
Reduced Cost.
Improved Resilience
and Scalability
Increase
Release Cadence 10x
Build for APIs and
Performance
Reduced
Time-to-Market
Customer Centric.
Extending to
Ecosystems
Business Benefits
▪ Cost efficiency
▪ Resilience
▪ Time-to-Market
▪ Ability to extend to ecosystems
▪ Ability to experiment for
improved customer experience
Investing in People and Skills
19

21. To be a technology leader, we wanted to own and run our own technology
1 2 3
DBS
Outsourced
85% outsourced  85% insourced
* DBS: includes all permanent staff and direct contractors
Outsourced: managed services resources
20

22. Become Cloud
Native
Reduced Cost.
Improved Resilience
and Scalability
Increase
Release Cadence 10x
Build for APIs and
Performance
Reduced
Time-to-Market
Customer Centric.
Extending to
Ecosystems
Business Benefits
▪ Cost efficiency
▪ Resilience
▪ Time-to-Market
▪ Ability to extend to ecosystems
▪ Ability to experiment for
improved customer experience
Investing in People and Skills
Gandalf Transformation Targets by 2018
21

23. Everyone has a cloud strategy
CLOUD
LIPSTICK?
OR CLOUD TO
THE CORE?
DBS Gandalf
, but not all are the same
Typical banks
22

24. How do we achieve cloud architecture?
▪ Dedicated to one application
▪ One Supplier
▪ Customised
Traditional architecture
▪ One Supplier
▪ Customised per application
Built for customised
Hardware and Software
▪ Open source: inexpensive to scale
▪ Standard: fault-tolerant through automation
Cloud architecture
▪ Shared
▪ Many suppliers: inexpensive
▪ Standard: fault-tolerant through scale
Built for Cloud
23

25. How is DBS doing on Private Cloud journey?
I want my own home
50% 93.8%
Typical DBS
How is the
move going?
% of Virtualization Achieved
I want my own space
1:10 1:>65
How do the
people share?
Consolidation Ratio: Physical to Virtual
I want to keep my own
Less Critical
Applications
All Applications
What about the
fixtures and
fittings (software)?
Applications Moved to Cloud Optimized Software
I want to automate it
Some Aggressive
How to service
the apartments?
Data Centre Automation
EASY VERY HARD
EASY
EASY
EASY
VERY HARD
VERY HARD
VERY HARD
Achieved
Achieved
WIP
WIP
24

26. Typical
Hardware
Software
People
>80%
DBSTraditional
TypicalDBSApplication
Most just adopt commodity
hardware and virtualise
Massive savings with DBS’ Gandalf Cloud approach
-20%
25
VERY HARD

27. How are we doing on our Applications transformation Journey?
Mostly
Regulatory
Systems
26Work in
Progress
Traditional and Typical Cloud
DBS Optimized Cloud

28. Pushing the envelope on cloud…
Typical banks Busy consolidating data centres
… and doing some cloud
Consolidated our physical data
centres years back …
we’re now shrinking
2018 target –
run 50% compute
on Public Cloud
Data Centres:
75% reduction by 2019
70% reduction in System Incidences,
despite 166% increase in Operating Systems
vs
(2010-2017 Oct)
27

29. Jack Ma (Alibaba) to Walmart –
“If you want 10,000 new customers, you have to build
a new warehouse, hire people … for me? 2 servers.”
Dave Gledhill to Jack Ma –
“You need 2 servers for 10,000 new customers …
For me 50,000 new customers need just 1 server”
“For me 50,000 new customers need just 1 server”
28
*Image source: Forbes

30. 0.7 0.7 0.6 0.6
0.5
0.3
0.4 0.4
0.5
0.5
2014 2015 2016 2017 2018
Build
Operate
9.9
10.9
11.5
11.9
DBS’ Technology Spend – Flat total spend in Phase 2
Shift happening from Operate to Build
Total Income
All figures are in S$ bn
Total Income
(Forecast)
1.0
1.1 1.1
1.1
1.0
29
Build core:
88% (2010)  44% (2017)
Build digital:
12%  56%

31. Become Cloud
Native
Reduced Cost.
Improved Resilience
and Scalability
Increase
Release Cadence 10x
Build for APIs and
Performance
Reduced
Time-to-Market
Customer Centric.
Extending to
Ecosystems
Business Benefits
▪ Cost efficiency
▪ Resilience
▪ Time-to-Market
▪ Ability to extend to ecosystems
▪ Ability to experiment for
improved customer experience
Investing in People and Skills
Gandalf Transformation Targets by 2018
30

32. What would
Jeff do?
31

33. Requirements
Gathering
ReleaseDevelopment
Test and
Quality
Assurance
Some learning
Lots of learning
Minimal learning
Cycle Time
Knowledge is power
32
*Source: Amazon

34. To introduce changes to production, code needs to be…
Written Scanned Built
Tested and
verified
Deployed in
different
environments
Manual Automate Manual Automate Manual Automate
Manual Automate
Manual Automate
DEVELOPMENT
ENVIRONMENT
PRODUCTION
ENVIRONMENT
Manual
Automate
Manual
Automate
33

35. Enterprise DevOps Platform - First we had to build complete automation pipeline
34

36. 2014 2017
Volume of automated test executions
Aggressive automation has enabled us to move much faster and
increase efficiency
7.5x
10X
10x
100%
DevOps: % of automated application releases
2014 2017
100%
2014 2017
Cadence – No. of monthly deployments
7.5X
35

37. Become Cloud
Native
Reduced Cost.
Improved Resilience
and Scalability
Increase
Release Cadence 10x
Build for APIs and
Performance
Reduced
Time-to-Market
Customer Centric.
Extending to
Ecosystems
Business Benefits
▪ Cost efficiency
▪ Resilience
▪ Time-to-Market
▪ Ability to extend to ecosystems
▪ Ability to experiment for
improved customer experience
Investing in People and Skills
Gandalf Transformation Targets by 2018
36

38. The design for modern systems – Enabling us to massively
scale… with ecosystem partners through APIs
37

39. Towards Making Banking Invisible… through APIs
✓ 8 million SMEs
✓ 30,000 salespersons
✓ DBS Inside
38

40. How could we do this at scale?
39

41. 50+
Live
partners
150+
Live APIs
We launched the world’s largest banking API platform
in early November 2017
40

42. Move from being
product-focused to
customer-centric
EMBED OURSELVES
IN THE CUSTOMER
JOURNEY
BECOME DIGITAL TO THE
CORE
CREATE A
22,000 START-UP
41

43. (2) My Finance
(3) My Way
CASA
Cards
TD
InvestmentsLoans
Mortgages
Payments Insurance
My Utilities
My Health
My Shopping
My Transport
My Car
My House
My Pension
My Child’s Education
My Wedding
My Entertainment
My Travel
My Education
(1) My Everyday Life & Goals
Make banking ‘invisible’
Context Location
42

44. 43
Transaction Journey
Customer Journey

45. What is….
…1 less retained
card worth?
44

46. Cash from parents’ perspective…
We want to eliminate cash
Discover Define Develop Deliver
45
Transaction Journey
Different perspective on cash
Customer Journey

47. POSB Smart Buddy was born…
A contactless payments ecosystem to cultivate sensible savings and spending
habits among young students in an interactive, engaging manner !
46

48. 1.6M Customers in 18 months!
90 SEC
ACCOUNT
OPENING
digibank … a bank in a smartphone
47

49. = bank branch?
digibank Operations
Traditional Bank Operations
90%
Pushing the boundaries
– how far can we go?
48

50. • Sharpen acquisition engine with MVP1
• Test launch in 2 cities
• Rapid iterations using Agile methodology
• digibank brand launched with Digor and
Sachin Tendulkar
• Payment products (UPI, Bharat QR)
• Investment and Insurance products
• Lending products
• Remittance products
Test MVP1 with liability & payment
platform to build scale Build out full value proposition
(Q4’15 to Q2’16) (Q3’16 onwards)Phase 1 Phase 2
Go-to-market
strategy
digibank India
49

51. 250
Employee Journeys
Customer Journeys
50

52. Strengthen our people
and culture
EMBED OURSELVES
IN THE CUSTOMER
JOURNEY
BECOME DIGITAL TO THE
CORE
CREATE A
22,000 START-UP
51

53. What makes a 22,000 start-up?
Agile
Take Risk &
Experiment
Data-Driven
Be a Learning
Organisation
Customer
Obsessed
52

54. We have the highest velocity ATMs in the world …
how do we stop them from going “cash-out”?
“Highest velocity in the world” *
20,000 transactions per month per machine
Average time between cash-outs
▪ 2010  3 months
55 years▪ 2017 
53
* Source: ATMIA 2014

55. Raw data
Training Data
- Number of trainings
attended
- Days of training
- Mandatory / Non-
mandatory
RM Revenue
- RM’s monthly
revenue dollar in
first 8 months
Leave Pattern
- In initial months
- Over several
consecutive
months
Branch details
- Branch location
Ensemble
Business Impact:
predictive accuracy
54
Predicting when a salesperson is going to leave

56. 1,000
Experiments
We set a target for ourselves… far exceeded that!
IMAGINARIUMS
API HACKTHATHONS
STARTUP XCHANGE
INNOVATION
BACKYARD
14,800
staff engaged in
innovation programmes
& more…
55

57. Being Agile
▪ Agile between business & tech
▪ Agile @ Work… even when we audit
▪ DBS Singapore
▪ DBS Group Audit
▪ DBS Asia Hub 2, Hyderabad
Changing the way we work…
…to foster collaboration
56

58. 57

60. Our digital customers don’t see us
as business and technology,
they see us as one
FUSING OUR DIGITAL DNA
TRANSITIONING TO PLATFORM OPERATING MODEL
59

61. We got our people to work with industry partners
and start-ups to develop innovative mindsets
30+
Business
Challenges
100+
Start-ups
introduced
500+
Participants in
community
events
Gandalf Scholars
Operations
Transformation
Program
Evangelists
Speaker SeriesLearning Hour
Sandbox
Learning
Lynda
Learning in different ways across the region…
transforming into digital bankers
60

62. Learn and Teach Back
61

63. j
VISIBLE OUTCOMES: Digital transformation pervasive
digibank Tally iWealth Treasury Prism
Digital
Onboarding
BusinessClass POSB
Smart Buddy
TRANSFORMING THE FRONT END…
digibank Virtual
Assistant
Contact Centre
Analytics
ATM Analytics Fraud Monitoring
HR Analytics
on RMs Open API Platform
… RE-ARCHITECTING THE BACK END
“It is demonstrably the case that digital innovation pervades every part of DBS,from
consumer to corporate, SMEs to transaction banking and even the DBS Foundation.”
Clive Horwood
Editor of Euromoney
62

64. So how does this translate into Digital Value?
63

65. Cost-Income
Ratio
Income
(S$bn)
45.0% 45.4%
43.3% 43.0%
9.6
10.8
11.5 11.9
Digital accelerated income growth, lowered structural costs,
boosting operating leverage
Cost-Income Ratio
Productivity gains from digitalisation
Income growth
Lift from digital
64
2014 2015 2016 2017

66. P&L for Digital and Traditional segments based on customer view
Traditional
Income
Profit
CIR
Cost
• Direct
• Indirect
• Overheads
Digital
Income
Profit
CIR
Cost
• Direct
• Indirect
• Overheads
• Digital and Traditional customers
identified based on banking behaviour
• Complete attribution of all income
streams and costs
• Full reconciliation to Group financial
statements
• Granular data to ensure methodology rigour
• Time-tested over three years
End-to-end P&L constructed
following a set of principles
65

67. Traditional
Digital
61% 39%
ROE 9pp higher ROE
19% 27%
T
D
Income per
Customer
2X income per customer
x 2.1x
T
D
Cost Income
Ratio
20pp lower CIR
55% 34%
T
D
Migrate
Superior returns from Digital segment
66

68. YOU MANAGE WHAT YOU MEASURE:
Balanced Scorecard and Management Processes
Today:Then:
50%
50%
Traditional KPIs
Strategic priorities
Shareholders
Achieve
sustainable
growth
Customers
Position DBS as
bank of choice
Employees
Position DBS
as employer
of choice
Geographies Regional
businesses
Enablers
40% Traditional KPIs
20% Making Banking Joyful
40% Strategic priorities
Shareholders
Achieve
sustainable
growth
Customers
Position DBS as
bank of choice
Employees
Position DBS
as employer
of choice
Drive digitally:
• Acquire
• Transact
• Engage
Joyful customers
& employees by
focusing on journeys,
experiences
Capture value
created from
digitalisation
Geographies
Regional
businesses
Enablers
Regulators Society
Regulators Society
67

69. We have changed the way we run our business
Acquire
Transact
Engage
Create instant fulfilment – making it easier for customers to use our
services
Decrease cost
Making it easier for customers to buy our products: wider distribution
Lower acquisition cost
Deliver the right offers, at the right time to increase traction through
contextual marketing
Increase income per customer
68

70. Acquire: KPIs set and tracked across products to drive results
Online deposit account openingIncrease digital share of:
• New account opening
• Banker’s guarantee
• Loans
Increase subscriptions:
• IDEAL – online banking platform
ExamplesKPIs
Consumer
SME
Online deposit account openingIncrease digital acquisition share:
• Deposits
• Cards
• Loans
• Equity
• Unit trusts
• General insurance
43%
11%
2014 2017
Digital share of deposits onboarding
32pp
64%
27%
20172014
37pp
Digital share of deposits onboarding
69

71. Transact: KPIs set and tracked to drive results
Migrate transactions to digital:
• Cash
• Trade
• FX
Design for “no-ops”:
• Cash and trade processing
• Loan creation, disbursements and servicing
• Account opening and maintenance
ExampleKPIs
Cross-border payments: Customer-initiatedMigrate transactions to digital:
• Deposits
• Remittance
• Loans
• Equity
• Unit trusts
Consumer
SME
2017201620152014
D
T
70

72. Engage: KPIs set and tracked to drive results
Contextual marketing: Drive cross-sell and up-sellIncrease number of:
• Digitally engaged customers
• BusinessClass members and activities
• Visits to DBS websites
Increase share of:
• Internet banking login frequency
• Mobile banking usage
Examples to drive ‘stickiness’KPIs
Omni: Instant points redemption, budget tracking, etc.Increase number of:
• Digitally engaged customers
• 30-day, 90-day active customers
Improve customer satisfaction:
• Internet banking
• Mobile banking
2.5x
Average spend
per Omni user
~S$1bn
Incremental deposits
30
Campaigns
Consumer
SME
71

73. Upside in Digital customer base to drive progressively lower CIR
43
Aspiration2017
<40
33
39
2015 2017
50-60
Aspiration
Cost-income ratio (%)Digital share of customers (%)
72

74. DBS’s ability to offer granular narration on how digitalisation
led to enhanced customer stickiness, higher transaction
volumes and lower costs.
In a disruptive world, it is probably time for investors to think
laterally and overlay a technology coat on DBS. DBS has
convinced us on its digital transformation. DBS should be in
your Singapore core holdings.
CIMB
Analyst briefing come and go. It was quite something, then,
when a DBS investor day triggered a raft of glowing analyst
reports and a 4% jump in the share price. The thing that so
enthused analysts is that this appears to be the clearest
articulation yet of what precisely a digital strategy means to
the bottom line.
Euromoney
DBS … presented one of the most
comprehensive digital strategies of
any bank in the world, let alone Asia
“The Bank of the Future”
Citi
DBS is among the rare banks in the
region who appears to be taking the
challenge head-on with an extensive
tech transformation.
Bloomberg Intelligence
We believe that DBS is among the best-
positioned banks to demonstrate
quantifiable benefits to drive re-rating…
Bernstein
Making our mark globally
73

75. DBS Transformation:
The World’s Best Digital Bank
Driving Digital Transformation
at DBS
The Digital Reinvention
of an Asian Bank
Rewiring the Enterprise
for Digital Innovation:
The Case of DBS Bank
DBS Bank Fosters a
Customer-Led
Innovation Culture
DBS Bank:
Transformation though
Strategy Implementation
Case studies on DBS’ Digital Transformation
74

76. World’s Best Digital Bank 2016
DBS: Top of the Digital Class 2017
Global recognition
75

77. Being the in
76