Lean Isn’t Always Lean

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A few days ago, I discussed application architecture in banking with a banking software vendor. Starting from there, we had a look at that vendor’s core banking solutions and further back-end systems, such as trade finance. The vendor quickly suggested that its solutions align with Forrester’s concept of a lean core. Now, you may ask yourself: Why is this relevant? Or — if you already know the lean core concept — is the vendor correct?

For those of you who don’t know Forrester’s digital banking platform architecture (DBPA) yet, let me explain the concept of DBPA and the lean core in a nutshell: It’s about splitting what’s traditionally considered core banking (and further back-end solutions) into two decoupled elements: the lean core and the digital core. The lean core focuses on data availability and consistency. On top, the digital core delivers domain-driven, highly coherent business capabilities (for example, for the customer domain) using data that the lean core provides via APIs. The architectural structure also allows traditional and DBPA-based applications to coexist during a continuous transformation journey and to work in banking ecosystems.

The vendor further explained that its banking back-end solutions were lean because it can provide exactly the functional scope that someone would expect from a trade finance solution, and nothing beyond that. Certainly, this aligns — at least to some extent — with the goal of high functional coherence within the digital core. However, this is not enough to turn a traditionally architected back-end solution into a lean core.

Now, why is this the case? If a trade finance solution merely consisted of a lean core, then it couldn’t deliver all the necessary functionality by definition. With the lean core’s focus on data and providing pure processing capabilities, such a solution would lack all the workflows and richer business capabilities. Thus, a complete trade finance solution can consist of a digital core and a lean core. However, it can never just be a lean core.

Why is this so important? If a solution delivers exactly the business capabilities needed to support trade finance, then it may or may not be a great banking application. However, without architectural alignment, this solution won’t be able to ease transformation challenges in the way that the combination of a digital core and lean core can. And easing transformation challenges is what banks are looking for.

The original article by Jost Hoppermann, vice president and principal analyst at Forrester, is here

The views and opinions expressed in this article are those of the author and do not necessarily reflect those of CDOTrends. Photo credit: iStockphoto/varle79