From bank - to a technology ecosystem: we investigate the strategy of digital transformation of Sberbank

Representing strategy in London at the end of 2017, German Gref designated three key priorities – both bank, and personal as SEO: personnel, clients and technologies. In not technology company only under vigilant supervision of the CEO it is possible to transform technologies, he explained.

Sberbank moves towards a complete didzhitalization

Vigilant supervision of the first person directs the largest bank of the country towards a complete didzhitalization. The platform to which by 2020 it is going to transfer all business should provide technological leadership. Its development in bank is conducted since 2015 and in the 2019th are going to perform data migration.

Within creation of the new platform more than 500 projects are implemented, including, artificial intelligence technologies, the possibility of dynamic pricing and the Sber-ID function allowing the client to get access to all services of bank are approved. These digital profiles will accumulate a maximum of information on users. By 2020 95% of offers of Sberbank are going to be done, based on reliable information about the client.

During transformation of core banking-платформы the technologies of GridGain company providing the high performance of transaction processing and scalability are applied. Sberbank acts not only as the first Russian client, but also as the investor of the developer.

By 2020 we are going to provide receipt in Cloud of all data demanded by consumers, to output all data, necessary for business, in a format of show-windows and to complete creation of a uniform semantic layer, said in the annual report of Sberbank

Mega-ecosystem

The new technology platform should increase process performance and efficiency of removal on the market of new products – including, external, partner. "Platform" - one or the other the most trend words of the last years, together with "ecosystem". Directing this trend, in the report Sberbank declares plans of creation of an ecosystem beyond the scope of the sphere, traditional for itself. For the purpose of preserving of long-term competitiveness it is going to expand the offer of services, additional, synergistic with financial products, in such spheres of life as purchases, the house, rest, health.

… Borders between the different industries are gradually erased because of focus shift from products towards client requirements which often have cross-industrial character.<…> Therefore we transform business of Sberbank, leaving from model of classical provider of financial services and passing to model of a global ecosystem. The problem of an ecosystem of Sberbank consists in selection and implementation of the best customer services for satisfaction of daily requirements of a wide range of clients. For this purpose we integrate based on a single platform of the partners of bank rendering services of both financial, and non-financial character, reported in the annual report

Sberbank develops the comprehensive ecosystem since 2016, gradually entering the markets, new to itself. Both affiliated enterprises, and the independent partner companies are involved. A number of such significant external partnership were concluded in 2017, and this list continues to be replenished in the 2018th.

Participants of an ecosystem get access to the system of identification of clients, single program interfaces, can quickly exchange data and so forth. Partners are selected by the principle of the leading positions from the most dynamically growing segments.

Partner initiatives of Sberbank

The loudest partnership are built regarding expansion of platforms and marketplaces. So, DocDoc.ru is a marketplace of medical services (covers 15 cities of Russia and more than 2000 clinics).

The "cloud" supermarket is started in partnership with I-Teco and also about IIDF and Skolkovo, providing access to the SberCloud platform to perspective startups.

Acquisition of a share in VisionLabs (enters world Top-3 on face recognition accuracy) allows to build the biometric platform for all ecosystem of bank.

The technology platform for expansion of mobile payments and services in management of e-wallets is provided by partnership about Yandex.Money which purpose – to construct domestic financial technical-company No. 1 with turnover over 9 billion rubles by 2020.

Segmento is the technology platform targetting advertizing on a basis offline and online data. Evotor provides sales management and online cash desks, being going to occupy 20% of the market by 2020. And service of the virtual operator "We will talk" "aims" in 3 million clients and revenue in 10 billion rubles by 2020.

Progressive trade

The joint venture about Yandex.Market (where there are more than 25 thousand private online stores) is directed to gain of export of goods abroad, involvement of foreign players and achievement of turnover over 500 billion rubles by 2020.

The transaction on creation of the joint venture was closed in the spring of 2018, its cost is estimated at 60 billion rubles. During the same period the test version of a marketplace of Beru where about 25 thousand positions in six types of goods were available (electronics, computer and home appliances, the house and the dacha, children's goods, beauty and health, goods for animals) earned. In June the number of positions reached 50 thousand, and by December, 2018 will grow to 150 thousand. Drugs, convenience goods (FMCG), food, clothes, books, furniture, auto parts, etc. will be added to the list of goods items.

Goods on a marketplace are placed by partner shops which provide storage, and delivery is performed by logistic services. It is planned that points of issue of goods will appear with time and in bank departments.

Online realtor

The child Center of the real estate from Sberbank develops the Domklik portal. It is the online platform for the solution of all key questions on real estate acquisition — from the request for the credit before submission of documents for state registration of the property right. There is also built-in search – service of selection of ready housing and apartments in the new buildings accredited by Sberbank.

At the initial stage invested 200 million rubles^[1] in Domklik^[2], the profit of service was 1 billion rubles (according to RBC, according to the first deputy chairman of Sberbank Maxim Poletayev).

Cyber security

In a cyber security segment Sberbank moves ahead through BIZON subsidiary company which develops own products Fraud Monitoring as a Service and Threat Intelligence Platform. Testing of solutions is held in own laboratory. In parallel with other structure – Sberbank Insurance – the service of risks insurance of cyber security for small enterprises is started. Similar services it is going to cover also other segments. Together with Russia Banking association the platform on data exchange in the field of cyber security for the financial industry of Russia, and with the World Economic Forum – for the companies of Europe and Asia is started.

The BISON also develops consulting in the field of cybersecurity, carries out diagnostics of cyber attacks and testing for penetration in 50 countries of the world. The company positions itself as the main marketplace of services cybersecurity in Russia. The BISON is a contractor on the project of connection of small business to the State system of detection, prevention and elimination of consequences of computer attacks system within the actions plan of the Digital Economy program.

New business environment

Sberbank - one of the Russian pioneers in the field of creation of online supermarkets for business - on this model in 2012 began to develop the Business Environment project for the purpose of support of an entrepreneurship and development of small business. In 2018 "The business environment" together with the Ministry of Economic Development of the Russian Federation starts the All-Russian platform where all services and content necessary for entrepreneurs in 12 directions will accumulate (not only in a text format, but also video and so forth). Sberbank invests 300 million rubles in this project (the subsidy from the Ministry of Economic Development as much again makes). At the platform more than hundred partners and two general partners – "Yandex" (provides technical support, start of mobile application with the voice assistant Alice is also planned) and Support of Russia (participates in assessment and study of content).

Investments in R&D

In 2017 Sberbank created 9 internal laboratories in the directions: artificial intelligence, cyber security, robotics, robotization of processes, blockchain, Internet of Things, virtual and augmented reality, new technological solutions and gamification.

For these laboratories the key performance indicator is set – not less than 70% of developments should make application studies by request of business blocks. At least 15% of a pool of business cases with technology pilots already left in commercial operation.

Data and artificial intelligence

Sberbank consistently builds infrastructure of storage and data processing, including, based on cloud computing, and develops other initiatives connected with use of data. In particular, in 2017 Data Science community and Academy of technologies and data were created. In bank the institute of CDO (Chef data officer) and institute of CDS (Chief data scientist) which work on management of corporate data models and creation of models which then are used in projects on artificial intelligence is built.

At the forum Synergy Global Forum 2017 German Gref noted that "the companies which do not use artificial intelligence will shortly disappear. Today the artificial intelligence is used literally in all spheres.<…> … A few years ago we used AI, generally in risks assessment. Today we have no sphere in which this technology would not be applied. We announced 259 projects in the field of artificial intelligence as a basis of our advance".

By own estimates the bank earns from implementation of artificial intelligence from two to three billion dollars a year, due to use of technology, including, for risks assessment, in scoring models and in sales management. According to Gref, the annual income and economy of costs of implementation of 10 projects with use of AI within the Center of technology innovations of Sberbank were in 2017 in total $13 billion^[3]

Already up to 99% of solutions on the credits to individuals in 2018 are accepted automatically, using artificial intelligence. According to the results of a pilot project of robotization of contact center for corporate clients service rate grew by 50%.

Sberbank developed service on the basis of machine learning for mass assessment of a commercial real estate. The neural network processes information on characteristics of an object, its location, pedestrian traffic, price zoning and also proximity more than to 200 categories of points of interest (POI). Service covers 36 largest cities of Russia with the population more than half a million people and is used for assessment of street retail objects. Its expansion also is planned for other segments of a commercial real estate.

Blockchain

In the development strategy of Sberbank the blockchain technology which allows to create the decentralized online services based on "smart contracts" is considered and increases safety of transactions. In 2018 the bank opened a blockchain laboratory, for the purpose of carrying out researches and creation of solutions on a basis a blockchain and also implementations of pilot projects for tasks of bank.

Earlier, in November, 2017 the bank became the organizer of carrying out the Russia's first pilot payment a blockchain transaction on the IBM Blockchain platform (HyperLedger Fabric). As partners also MegaFon, "Megalabs" and Alfa-Bank acted. Unlike hours-long bank transfer, passed a blockchain transaction instantly.

The Sberbank Factoring subsidiary company already implemented the decentralized open system for carrying out reconciliation of data on deliveries between participants of the factoring transaction on the basis of the smart contract. In total for 2018 the bank implemented more than 20 different pilots on blockchain technology (solutions with Severstal, M.Video, FAS, etc.)

Internet of Things

Sberbank is included into consortium of Competence center of wireless communication and Internet of Things (together with Skoltech, Atomstroyexport, Gazpromneft, RKS and also about 10 universities and research centers, etc.). The competence center will initiate researches in the field of Internet of Things, to implement results of scientific developments in business and to promote an output of products to international market.

Among the directions of development of IoT, potentially interesting to Sberbank, - the "smart" building, "smart" shop, the "smart" city, eHealth and the concept of Bank of things — automatic payments which can enter different devices without participation of the person. In several bank departments projects of collecting of telemetered informations and remote control are already implemented.

In September, 2018 Sberbank together with Skoltech held the Hackathon for programming teams according to the solution of applied tasks in the field of Internet of Things. The main directions stated the "smart" city, the "smart" house, health & agro, smart price labels and the exchange systems and also platforms of data analysis.

Additional value

Till 2018 the share of non-bank products in revenue of Sberbank made no more than 2-3% by own estimates. According to the forecast of TAdviser only cloud solutions, cybersecurity services and the mobile operator can bring more than 5 billion rubles in the next year. In 2020 this revenue can increase by 15-20%, taking into account dynamics of segments IaaS, SaaS and cybersecurity in the Russian market in general.

Staking on creation of a comprehensive ecosystem, Sberbank develops partnership with increasing number a high tech players. If in an IaaS segment it is the anchor partner of I-Teco, then in the SaaS segment their number is much more (including 1C and MyWayhouse, SAP, Microsoft and so forth) - and will extend. Not banks, and even not "old" IT integrators, and the transformed telecom operators – Megafon, Rostelecom and MTS which also increase cloud businesses become main competitors at a new deal any more, build the centers of cyber security and create the digital platforms.

Potential revenue of Sberbank from non-bank digital services

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