[jcims]

I've been out of consulting for 7 years now, so I don't know how widespread or old the trend is, but I'm seeing a lot of banks moving to a product operating model for their internal/backend software. The last place I worked had been at it for a couple of years and there were a few teams that really ran with it. At some point why not turn them into a profit center?

[zxcvbn4038]

Years ago when I was at Chase Manhattan (shudder) they were at the other end of the extreme where there were multiple teams within the bank that did the exact same thing, and they would have to undercut one another to get business from other internal teams. Somehow everyone got enough business that the teams didn’t ever merge which is good, because rivalries between the teams became so fierce that none of them could work with someone who had been on a competing team. Managers loved it because if you had dollars to spend you would have a lot of people kissing up to win your favor - you could get a lot of free lunches and end of year your office would be full of gift baskets.

[tomrod]

Allegedly, Rocket Mortgage was built on top of an internal project + lessons learned for another large bank. One could argue that was a very specific example of the general trend you're discussing.

[tootie]

I've seen so many companies in multiple domains including consulting firms be so proud of their software they try to sell it on the open market. I've also never seen it succeed.

Whatever you have to say about Capital One as a bank or as a software company, they are absolutely top tier when it comes to marketing. At least B2C marketing. If they succeed at this it will be on the strength of their marketing.

[chevman]

Yes, this a thousand times over!

Why would I spend 100x the cost to buy an internally developed solution that is barely an MVP product when I could buy a market leading, polished, SaaS product from a vendor who takes me out to dinner and ballgames? They also have implementation and professional service teams to help install said product quickly and efficiently, and many third party consulting firms if I need even more help (they take me out to dinner too!).

Oh, also the vendor doesn't yell at me like the internal IT teams do :)

Quite the conundrum for sure!

Would love to know which execs approved this at Capital One and what happens when they leave and everyone's air cover is gone?

[ethbr0]

> Why would I spend 100x the cost to buy an internally developed solution that is barely an MVP product when I could buy a market leading, polished, SaaS product from a vendor who takes me out to dinner and ballgames?

Sooo... not Google products?

[cperciva]

The trend of banks outsourcing software dates back decades. The "online banking" systems of most small banks and credit unions are outsourced, for example; if you have three branches and an IT staff of two people, you're going to struggle to maintain those sorts of systems yourself, never mind developing them in the first place.