>> Narrator: From around the globe, it's theCUBE,
with digital coverage of IBM Think 2021.
Brought to you by IBM.
(upbeat music)
>> Welcome back to theCUBE coverage
of IBM Think 2021.
I'm John Furrier, your host of theCUBE.
Riccardo Forlenza's here with me.
He's the global managing director
for IBM at Citigroup.
Riccardo, great to see you.
Thank you for coming on theCUBE.
>> Thanks for having me.
>> You're the team leader for Citigroup, managing director.
Lot going on in the world of finance,
FinTech, technology, scale, transformation.
All this is happening,
always a leading edge indicator.
Give us your perspective on the market right now
on that vertical and in general.
Because there's so much scale,
so much machine learning,
so much going on,
so much competitive advantages.
Give us an overview of the industry
and how you see them.
>> So John I've had the good fortune of working
essentially around the world.
I've worked in Europe, in Asia, in Australia,
back here in North America.
And I'll tell you what,
there are some dynamics that are specific to a market,
but there are also a lot of common threads, right?
You know, a lot of common threads, right?
As you know, my industry,
financial service is in the middle
of a great disruption, right?
From payments to global wealth,
to understanding exactly how to reposition yourself
as a startup oftentimes,
looking not to be disintermediated by many of the FinTechs.
I have found that many financial institutions
are very adept
at changing the way they operate.
A lot more nimble than they have been in the past,
and they've found ways to
incorporate a lot of the techniques
that some the FinTechs operate with.
So, they all have shark tanks.
They all find a way to progress investments
that they get to a point of feeling fast, right?
Some are more adept than others,
but for the most part that I'd say that
everyone in the market
is looking to beef up their core competencies.
>> And, you know, the financial industry
has never been shy of using technology, ever.
They've always poured it on.
They always wanted to get more edge.
What is the edge now in the industry for financial
and in general businesses who are learning
how to be agile.
What's the edge?
>> I think the edge is really finding
a way to be ambidextrous, right?
Because in many respects,
you do want to hold on to a franchise,
to what got you to a level of success.
It's oftentimes it's in the case with my client,
is surging could stand for more than a hundred years, right?
So you don't want to let that go,
but you also want to grow a new set of skills
and grow competencies
that they need to take into the future.
I have found that in many respects that
many of my clients remind me
of what Lou Gerstner once said,
maybe 20, 25 years ago,
our former CEO and chairman,
who said the last thing that IBM needs is his strategy.
And in fact,
I think that many of our financial institutions
don't need a strategy,
they just need the competencies to innovate
and execute at scale.
And that's a lot easier said than done.
>> Riccardo, I want to get your perspective
before we move on to some of the initiatives
and work at Citi,
which is probably compelling,
but I want to get your expert opinion
on a question that comes up all the time with customers
and that are going post-pandemic
and looking at growth strategies.
The idea of the unit economics of their business models
tend to change with more data,
more digital acceleration.
Is there any observations that you could share for leaders
who are looking to get that financial mindset
or of how the business is changing with,
whether it's KPIs or business models.
Because at the end of the day,
the financial upside of what we're seeing with digital
is pretty significant.
The economics are seem to be a real game changer
on these a lot.
These conversations are about acceleration,
but also the results are business results or money.
>> Absolutely John,
as a matter of fact that,
I'd argue that while it's true
that the common themes are many,
and that several of our financial institutions
are growing a skill in
approaching problems in a different fashion.
It's also true that there's been
a lot of redistribution of wealth
across financial enterprises, right?
So it's not lost on all of us, right?
That security through market capitalization
of leading financial institutions how they were,
they've really gone all over the place
with clear winners in several sectors, right?
In Asia and Europe,
as well as here in North America.
So what I'd argue is that,
while I think we're all tired of hearing
that data is the new oil, right?
It's also true that we need to find a way
to finally harness the power of it, right?
And that's what I think IBM is more adept at, right?
I'd argue that many of the the common threads
that we've seen across financial institutions,
and back to the measures of success
that you indicated a minute ago,
are really around cloud, right,
Around data and around digital transformation, right?
So our approach to cloud for instance is unique, right?
While there are a number of very competent hyperscalers,
we've taken a different approach to it, right?
We've taken an approach that's more gone after,
other highly specialized regulated workloads,
or gone after the layer
that allows you to port applications seamlessly
based on regulation costs and competition
across multiple platforms.
So this hybrid concept
it's only been at the center of our cloud strategy.
And that's the one that in my mind
is delivering our clients the greatest volume.
Tell you what,
I think one client told me once
after hearing our hybrid story,
that while there were many cloud providers
there wasn't anyone that could help him
quite as much as IBM,
dealing with their legacy.
And in all candor,
I think it's fair to say that legacy
is here to stay
well past our investment horizon, right?
So that level of self-awareness,
I think ended up a belief
for me in our collaborations for years to come.
>> You know, I'm a big believer
and I've reported this
and certainly talk to Arvind
when he was on theCUBE about this.
Microservices containers, Kubernetes,
these kinds of new technologies
really allow for legacy to integrate well
into the new modern era of computing in hybrid cloud.
So, totally agree,
and that is really key tailwind
for innovation and these transformations.
So I have to ask you, Riccardo,
what's going on at Citi and IBM.
Take us through some things that you're working on.
Some of the exciting projects that you're driving.
>> So the disclaimer is that
I started small three months ago,
so I'll try to do my team proud here.
But what I'll tell you,
is that the teams we talked about
are alive and well at Citi, right?
So on the cloud front
we are doing exactly that.
We're focusing on being a Citi's partner
on the hybrid cloud deployment.
Acknowledging that hybrid cloud is an ecosystem
of participants, right?
Acknowledging that IBM's dominance in on-prem computing
will go through a very different phase going forward.
We not only are comfortable with it,
but we're trying to accelerate its deployment, right?
So you mentioned Kubernetes,
you mentioned containers,
hence our red hat acquisition, right?
Which has been central to collaboration
that we've established at Citi
and we're looking to grow.
Also, go back to data,
and I will tell you that,
as you know,
CPC in the midst of a transformation journey
of their own, right?
It's also in the middle of a regulatory challenge
that's second to none, right?
With the OCC findings that then led to
a fine and a remediation plan
that the bank has put in place
over the past two months.
With that in mind,
we are looking to help the bank
make use of good of a crisis,
make the most of a good crisis, right?
And so, we're helping for instance,
Marc Sabino, the head of innovation at Citi,
find ways to infuse AI
into their internal audit practices.
Doing that, it's just smart business.
It results in much better outcome
and at a lower cost.
And it's something that can scale,
because it's all seen before.
Oftentimes our solutions
have lacked the ability to scale
to really keep up with client demand.
>> Riccardo, the relationship between IBM and Citi
has been longstanding.
I believe I read somewhere you're celebrating
hundred year partnership.
Is that true?
If so, I mean it's a huge milestone.
What's the...
Take us through the history
and where this is going as a partnership.
>> I've heard, as a matter of fact
since I first came on board,
that in fact our companies have been at it
for more than a hundred years.
Someone showed me an actual document 100 years old.
It was proof positive of that.
So I'll tell you,
I know that our firms will be at it again
a hundred years from now.
I will probably not be here to toast to it,
but I'm certain they will continue to collaborate
and for a long this is my responsibility,
I'll do whatever I can to help you continue to grow.
We are only going to focus on three things.
I spoke about hybrid cloud.
What we also want to be the partner
as the bank transforms its operations, right?
And infused in it are AI
and process automation skills and capabilities.
I think if we do that,
we'll continue to collaborate
and we'll continue to have our partnership
fully rests on two pillars
that is always some dependent.
Which are really innovation and trust.
>> Great commentary,
great on account that you're leading
probably a great team behind it.
How many people are on this team?
Must be pretty massive.
And I'd love to see that document by the way.
Was it a memo?
Was that typewritten?
Was it handwritten?
Was it a PO?
>> It was a typewritten document and I'll get you a copy.
>> Oh, it's so historic.
I love those historic.
I'd love the IBM culture and long-standing relationships.
Final question for you.
You've been in the industry for a while.
You've seen many waves of innovation.
If you're talking to a customer,
your friend or colleague
and they had asked you,
"Riccardo, why is this wave so big and so important?"
What would you tell them?
>> John, I think at the heart of this transformation,
the evolution, the wave as you called it,
is not the introduction of new products,
the introduction of new processes,
but entire new value chains that have been established
by players that in many cases
need each other to co-exist.
This has hardly ever been the case in the past.
I think IBM will form a great example of it, right?
And so I do think that this is far more disruptive
than what we have witnessed in years past,
and I can't wait to get in it
and do my part to lead us through it.
>> Riccardo, great insight.
Totally agree.
This is a time of open collaboration and ecosystem.
Your seeing an ecosystem and network effect
where people are integrating together
in this new connected,
distributed economy, global economy.
Thank you for coming on theCUBE.
Appreciate your time.
>> Thank you so much for having me.
>> Okay. Riccardo Forlenza,
global managing director for IBM at Citigroup.
This is theCUBE coverage of IBM Think 2021.
I'm John Furrier, your host.
Thanks for watching.
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