Capco Unveils New Report Offering Strategies for Improving IT Optimization Through New Supply Chain Model

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Report Details the Downstream Impact of IT Optimization Policies.

Capco, the global provider of consulting and managed services to the financial services industry, has published a new report outlining an improved model for evaluating the impact of IT optimization projects and governance policies on the systems development life cycle. The report, entitled, “Managing the Ripple Effect — CIOs Maximize IT Supply Chain to Improve Business Alignment and Efficiency,” provides banks and financial organizations with new insights into the dynamics of IT management that will help executives better anticipate the full effect of new policies and procedures.

According to the report, IT managers frequently encounter unexpected issues that develop as the result of decisions made to improve or revamp an isolated portion of an application development process, testing protocol or other elements of the development life cycle. Although many managers realize that modifying a process may lead to unintended consequences, few firms use a formalized system of measures to assess the impact.

Some key highlights of the report reveal that:

  •     Viewing IT as a “black box” function, one too complicated to fully understand, has nurtured the practice of funding IT as a percentage of revenue, rather than properly assessing the true nature of IT development costs.
  •     Because firms have no method of assessing changes, managers often discover that adding resources at one stage leads to the creation of bottlenecks further along the development chain.
  •     Popular efforts, such as the establishment of IT governance policies, can induce new dynamics that upset the development life cycle. New, stricter metrics intended to improve the return on IT projects can have unintended effects on the nature and scope of projects.

While new initiatives designed to cut costs or improve outcomes can create unpleasant surprises, a new development mindset coupled with expanded metrics can help managers predict outcomes with greater clarity.

According to the report, there are several recommended steps financial institutions can take to better predict the impact of changes that affect a firm’s IT function.

  •     Develop a framework that illustrates the impact IT decisions have on the organization.
  •     Strengthen the CIO role to that of trusted advisor rather than IT defender.
  •     Visualize the development life cycle as a supply chain that is affected by upstream decisions.
  •     Use metrics that calculate the impact of decisions on processes downstream, such as the effect a rapid increase in the number of developers will have on product testing.

The findings of Capco’s report outline the steps an IT organization can take to redefine its strategic role in the firm. The report explains the IT supply chain model and its impact on strategic decisions affecting IT, including a number of measures companies can take to implement this new model.

The report is available now at

About Capco
Capco is a leading global provider of integrated consulting, technology and transformation services dedicated solely to the financial services industry. Our professionals combine innovative thinking with our unrivalled firsthand industry knowledge to offer our clients consulting expertise, complex technology and package integration, and managed services to move their organizations forward. Through our collaborative and efficient approach, we help our clients successfully increase revenue, manage risk and regulatory change, reduce costs and enhance control. In North America, we specialize in Banking; Capital Markets; Wealth and Investment Management; Finance, Risk & Compliance and Technology, with offices in Chicago, Washington, D.C., New York, San Francisco and Toronto. To learn more, contact us at + 1 212-284-8600 (+32 3 740 10 00 from outside the United States or Canada), or visit our Web site at


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Lane Cooper

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Diana Butler Buxton

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