Shinsei Bank Case Study

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2. Dealing with legacy systems can pose a major hurdle to many companies when the realization is made that a new IT infrastructure is needed to keep up with the times. Incompatibility issues with newer technology, residual process complexity, local adaptation and non-standard data definitions are just some of the problems that arise when a company tries to figure out how to handle their legacy systems. Jay Dvivedi came across some of these problems when he was charged with overhauling the IT infrastructure of the newly conceived Shinsei Bank. Dvivedi quickly realized that the old legacy systems were almost entirely useless to the new business model Shinsei was attempting to implement. However, legacy systems are not so easily discarded. He had to ask himself questions such as how will new infrastructures affect ways of working and communicating not only with the customer but also within the company or what is the long term strategy for renewing legacy systems? Dvivedi realized he needed to completely replace the IT infrastructure in order to ensure that Shinsei, a new entrant in the Japanese banking industry, could be as competitive as possible. He was faced with a number of choices. He could have chosen to gradually overhaul the whole system, replacing one process at a time. While this approach would have been the least disruptive it would have taken too long. Alternatively, he could have chosen an “all-at-once” approach which however was deemed to risky, disruptive and costly. Ultimately, Dvivedi decided to firstly create standardized platforms, meaning one network protocol, one operating system, and one hardware platform. Dvivedi and his team decided to implement new processes as they were needed, first parallel with the old infrastructure but with the intention of ultimately superseding the old legacy systems. When implementing the new model Dvivedi focused on a five fold strategy. He focused on a relatively speedy...
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