This transformation model enables Vanguard IT to increase speed and innovation

Just about every week, I read a story about how a startup is disrupting an industry or introducing a new idea that promises to change the world. In the past, many leaders have been tempted to dismiss these stories as outliers and assumed that they were safe from disruption, but the world has changed rapidly over the past five years. 

Startups have proven that they can operate in a fast and nimble way, and leaders can’t assume that what has protected them in the past will provide them shelter in the future. Every business, regardless of its size or industry, needs to adopt new ways of working and learn lessons from unconventional competitors.  

At Vanguard, our IT organization has one rallying cry that serves to focus us on this new and nimble way of delivering business outcomes. We call it, "Deliver business value at startup speed (BV @ SS)." From redefining how we test our software to enhancing our infrastructure to accommodate advances in cloud technology, we are completely rethinking what it means to deliver business solutions.

This kind of change is never easy, especially for a large global financial services company like Vanguard with over 14,000 employees and more than $3.8 trillion in assets under management. To help us strategize and crystalize our vision, we focus on three tiers of change: infrastructure, technology, and culture.

Agile infrastructure

The foundation of everything we do in IT is our infrastructure. In order to deploy modern applications in an agile way, we need to create systems that are flexible and scalable. For us, this means leveraging the advantages that public cloud providers offer and automating the manual process needed to handle infrastructure requests.

Through the realization of both of these initiatives, we are creating an environment where our engineers can self-provision what they need without relying on time-intensive and error-prone manual processes. We are also creating efficiencies by increasing both utilization and speed. Bottom-line, it's an agile infrastructure.  

Agile technology

With a base of agile infrastructure, the next tier of our transformation focuses on how we develop technology solutions for our businesses. For Vanguard, this means embracing DevOps principles in order to minimize the time between when code is checked into our version management system and when a feature is available to our clients.

We accomplish this through three separate initiatives. First, we’re decoupling our monolithic systems into microservices. These microservices are small, independently deployed entities that enable us to decrease the number of dependencies in our system. This decreased dependency allows us to quickly deploy new functionality without having to worry about impacts to other systems.

Second, we are introducing new tools that automate our build processes and reduce the need for manual approvals when they don’t provide value.  Not only does this automation provide the immediate benefits of reducing the amount of time spent on manual processes, it decreases errors that typically lead to process delays downstream.

Finally, we are completely rethinking the way that Vanguard tests the applications that we develop. We can’t hope to drive faster solutions if it takes a long period of time for us to manually regression test our codebase before we deploy new features. To solve this, we are automating our tests and, in many cases, creating our test cases before development even begins.

Agile business

With the technology underpinnings of our infrastructure and technology strategies in place, we are implementing Lean development practices in order to increase the pace at which ideas go from hypothesis to realization. Lean development practices mean different things to different companies, but for Vanguard, Lean is about quickly iterating through a cycle of building, testing, and learning to drive business value. This means full stack teams with integrated business partners focused on experimentation-based design in order to meet a business outcome.  

While our technology and infrastructure tiers are focused on building out technical solutions, Lean development is driven by cultural changes, and it’s not something that IT can do in isolation. This is why we partner with corporate strategy and each of our businesses to pilot Lean initiatives.

The recent emergence of digital disruptors has shown what happens to organizations that fail to adapt to a changing climate. Through our three-tier transformation model (BV @ SS), we are positioning Vanguard to adopt many of the principles that have become second nature for startups, increasing speed and positioning us for continued success.