June 2018

Thomas Nielsen loves creating products and technology that people use every day, and brought digital transformation to Tesco after a career in Silicon Valley. Now with Deutsche Bank at the dawn of a new open banking world, he explains how technology is a strategic differentiator

You joined Deutsche Bank in September 2017. What prompted the leap from a fast-moving consumer goods (FMCG) environment to a financial institution?

I am attracted to big, complex problems that can’t just be solved by applying technology, but require a fundamental change in people’s mindset and approach. The opportunity to reshape an industry on a global scale doesn’t come around that often – and there are very few places you can do that today. The financial services sector is one of the remaining bastions ripe for disruption and reinvention.

Take us back to how it all started

I grew up in Denmark and both my parents were teachers. From a young age I wanted to become a musician. But it is hard to achieve financial success in that world, so while playing in a band and not being able to afford the recording equipment available at that time, a few of us got together and, thanks to personal computers starting to become mainstream, we ended up creating our own digital recording studio software. It got to market almost by accident and was an immediate success. The taste of creating a product that millions of other people wanted to use was highly addictive.

From there, I moved on to the world of automated desktop publishing software and eventually ended up selling our company to a set of investors in Toronto. It was there I got the chance to join a start-up and be part of the first dotcom bubble in the mid-1990s. We were the first to create consumer software for photo and video editing at a time when Kodak was convinced that digital cameras would “never become mainstream”. Two years later we employed 400 people and we eventually took the company public. Those were the days.

Next stop Silicon Valley?

Yes, to Microsoft in 1999, where I spent almost seven years in the Windows division, leading and managing a large portion of the engineering and product organisation. During that time, Microsoft grew rapidly and had to address the growing pains of developing a culture that fostered innovation and inclusion while managing the growth.

Then it was off to Adobe to help them with setting up the Creative Suite of products and building out their online business; I eventually became the general manager of their Photoshop product portfolio. In 2011, I became the CEO of RealNetworks, but left a year later when I realised that what really motivates me is building products and services used by millions of customers. Being a CEO does not really allow for that, so I left and joined Brightcove – a leading video streaming platform in Boston. And when we acquired one of our competitors, I decided to retire from the tech world.

But ‘retirement’ didn’t last very long, did it?

Well, all of six to seven weeks, at which point, my wife said she would find me a job if I didn’t! It was then I got the craziest call from Tesco in the UK. It went something along the lines of, “We know we need to do things differently but we don’t know what we are looking for. We have a bunch of old technology, and the way we work isn’t very scaleable and customer-friendly, as we have been in silos for years. Would you be interested in coming to fix that?” I said, absolutely not, I don’t want to move to London and I don’t want to work in retail.

So what changed your mind?

Actually, my wife was keen to move to London and thought it was a great opportunity! So I called back with my tail between my legs the next day and said there must have been some crackle on the line, because what I meant to say was that I would love to come. I landed in London, but six weeks later the Tesco CEO, Philip Clarke, left and Dave Lewis [the current incumbent] arrived from Unilever and became my boss. My job was a mix between being a digital ambassador, a diplomat, an evangelist, a translator/decoder and “Chief Transformation Officer”. We built out a large digital team in central London to start addressing our disjointed e-commerce and in-store workflows, and developed the digital marketing and loyalty (Clubcard) programmes for Tesco.

What made you join Deutsche Bank?

I was approached by Deutsche Bank, and what was supposed to be a 45-minute informal coffee meeting ended up becoming 21 interviews with an amazing set of people. The scale of the challenge was similar to the one I got from Tesco – but overlaid with a new industry and a global reach. I could simply not resist.

"We need to be as agnostic as possible and enable interoperability"

One of the challenges that banks have to deal with is the increasing amount of regulation. For example, PSD2 opens up our traditional customer space to third parties. How does technology help us deal with this?

It is somewhat unfortunate that it took regulation to push the banking industry into opening up its platforms. When you look at larger industries outside financial services, they have benefited tremendously from openness and interconnectivity. Look at Apple’s App Store and the way Google Maps is a platform that can be embedded into other applications. There is a real opportunity for Deutsche Bank to leapfrog existing workflows and platforms and make technology sing for us – and if we don’t do it, someone else will. The days of building and owning everything in-house are behind us, and we need to leverage the opportunity that new technologies (like the use of public clouds) provides. We also need to learn from companies like Apple to work out the things we really need to “own” and control from a user experience, and then how we open up the rest of our platform and systems to clients, fintechs, ERP partners and possibly other banks.

Do you think that these companies will want to connect to a platform managed by a single bank? What about common standards?

There will be a couple of open standards, but you don’t win by “controlling” or monetising standards – they are merely enablers. We need to be as agnostic as possible and enable interoperability. We are well positioned to do this, given our large global footprint and experience in connecting with many systems and platforms. We are investing heavily in a globally available Open API platform, so whether you sit in Germany, Taiwan, the UAE or Singapore, you will interface with Deutsche Bank in the same way and we will shield you as a client from all the cross-border technical, regulatory and compliance challenges. This is what gets me excited.

Is data really the new oil?

It has been for at least 20 years, but most large organisations are what are called DRIP: Data Rich, Insight Poor. Big data is about how to bring siloed data sources together in a meaningful and well-governed way and make sense of it. For me, this is a three-step process:

  1. Focus on the technology and governance platforms to bring the data together in a meaningful, trusted and well-governed way (think GDPR, internal and external permissions, etc.);
  2. Start using the data for internal and regulatory reporting purposes and get better at doing this; and
  3. Consider ways of working with our customers to create products and solutions that derive intrinsic value from the various datasets.

Most people like to go straight to the third step. But to get there, we have to build the systems and tools to make that available with high quality and ‘golden sources’ and prove to ourselves, our customers and regulators that we have the right controls and processes available to leverage that data.

Does the culture in banks have to change to encourage this evolution?

Absolutely! Being ‘digital’ is all about the approach and mindset. It’s about individual empowerment, not being afraid of failure and not accepting that “this is the way it has always been”. We need to learn from tech companies and start-ups to improve the way we develop and deploy products in a world that is changing faster than ever. Fundamentally, it is about making technology a strategic differentiator for Deutsche Bank. All change is hard – but the way to drive change in a large organisation like Deutsche Bank is to start on a small scale with a number of broad-minded, willing people to drive small, frequent wins, with nimbleness to pivot if a particular idea does not work out as expected. One does not learn to ride a bicycle without getting a few skinned knees. The winner takes all – and I like to play to win.


Thomas Nielsen is Deutsche Banks’s Chief Digital Officer in Global Transaction Banking

Thomas Nielsen

Chief Digital Officer Global Transaction Banking | Deutsche Bank

Thomas Nielsen

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