°neo - the new ‘banking grade’ SaaS platform

For the last decade, five°degrees has been supplying leading financial institutions with a tried-and-trusted core banking product. Last year saw the launch of a completely cloud-native version that will enable customers to continue to meet ever-changing market requirements even in the long term. The partnership with Levi9 proved to be instrumental in the development of the new platform. ‘It was exactly the type of synergy we needed,’ confirm CEO Martijn Hohmann and CTO Jeffrey Severijn.

Instead of modernising the existing solution, the decision was made to redesign the new one from scratch. It is now ready for the market. ‘Unlike the old stack, the new ‘banking grade’ SaaS platform – known as °neo – is component-based,’ explains CEO Martijn Hohmann. ‘Over time, the number of building blocks will gradually increase. It will also become easier to link external services and ecosystems together.’

Five°degrees and Levi9 Technology Services have been working together for seven years, but the interaction has entered a new phase in the last four years. ‘At management and shareholder level, we’ve been considering how to get the most value out of our relationship for some time,’ says the CEO.

‘Levi9 is really determined to create value on the business side for customers, partly because that’s also interesting for their own employees.’ – Hohmann

Added value

‘Delivering value for business is the holy grail for developers,’ says CTO Jeffrey Severijn, who also has ultimate responsibility for the °neo platform. ‘Being able to offer employees a challenging working environment is important for Levi9. As far as our traditionally designed °matrix solution was concerned, our relationship was gradually entering the danger zone. Developers were just losing their enthusiasm for it.’

According to the CTO, there was also another factor at play, ‘Outsourcing partners are facing significant increases in salaries in their international branches caused by the COVID-19 pandemic. That eats into the price advantage. Companies like these now need to distinguish themselves in different ways. For example, through specific market or domain knowledge that we can make use of.’

There is added value for five°degrees if a player like Levi9, with six delivery centres in Eastern Europe, has experience with the Azure cloud, for example within a media company. ‘They can then discuss applying those competencies for other customers, which has advantages for everyone: partner, staff, and customers. It even opens up the potential of wider co-creation in the future.’

It was during a frank discussion with Levi9 about all of this that things started to move forward.

‘We had talks with various different players about modernising our existing core banking product, but we achieved very little. However, Levi9 came from a different direction and suggested adopting a totally different approach using the latest methods and techniques. That brought a fundamental change in our partnership – and one that added value for all of us.’ – Hohmann

Start-up strategy

Around 80 people – half of the total capacity – worked on °neo over a three-year period. The completely new platform features lower variable costs, offers much more flexibility and has an important role to play in the company’s global ambitions. Severijn: ‘Together, we approached it as if it was a start-up: from the initial design to a minimum viable product before going on to develop a technical MVP. All of it agile and focussing on the potential for rapid upscaling. Ultimately, it all turned out well.’

The partnership is based around the shared objectives that the two companies aim to achieve as a team. ‘It really is a joint initiative,’ say the CTO and CEO. ‘Our people sometimes struggled with that. It was no longer a case of “we ask, and they do what we say”, as you would approach it with development teams in India or Vietnam, for example. Everything is based on a relationship of equality.’

According to the management at five°degrees, this has brought out the very best in everyone, starting from a blank piece of paper. Severijn: ‘The contribution made by Levi9 was primarily technical: the Azure cloud, event-driven architecture, microservices, and so on. Our main focus was on the functional aspects. We then came up with a lot of great ideas together.’

Speeding up the process

Examples of this include work relating to Logic Apps for integrating apps, data, services, and systems using automated workflows in Azure. ‘During a demo with the key engineers from Microsoft, it turned out that we were further advanced than they were on some points,’ says Hohmann enthusiastically. ‘It was so good in fact that they even adopted some of our ideas.’

As for the partnership, the CEO is keen to stress how productive and enjoyable it is. ‘If people from Levi9 have ideas about how things can be improved, we’re always keen to listen. In return, we gave a presentation about the future of banking to their development team in Serbia.’

Jeffrey Severijn: ‘During the demos, members of the Levi9 team also made regular contributions. That helps create ownership and mutual understanding. Even when there are challenges, if something takes slightly more time, or if the requirements are unclear. The fact that we already knew each other allowed us to speed up the process that little bit. Ultimately, developing a new relationship always takes time – but we understand each other’s strengths and weaknesses.’

‘All in all, it was exactly the synergy we needed to make a success of the °neo project,’ concludes CEO Martijn Hohmann. ‘I’d even go so far to say that it would have been impossible without it.’

Martijn Hohmann, CEO five°degrees

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