Estimated reading time: 2 minutes
How can a BANK have a $14B tech budget?? (cough, cough, JP Morgan)
The answer isn’t SIZE – It’s AGE.
Most businesses get big because they’ve been around for a long time.
(Except now, tech companies can get really big, really fast)
But for our purposes,
Big Business = Old Business spend
Let’s take Wells Fargo as an example.
A 170-year-old company that was already pretty big by the time computers rolled around.
They bought one of the earliest computers, and built code to help them perform some of their core functions.
They had no idea how fast tech would evolve so they just built and built and built on top of that original code.
Before you know it, any change you want to make to the original code affects thousands, maybe millions of other variables.
So what do you do??
Just hide the problem.
Wrap it in a new User Interface.
Build some sort of work-around.
No one will know the difference.
The problem comes when something happens that FORCES you to change or update legacy tech. (cough, cough, Southwest Airlines)
EVERYTHING is built off of this.
To the point that it’s difficult to determine exactly what the changes might affect.
So updating it really does take scores of very smart people and BILLIONS of dollars to make sure you don’t break the entire system in the process.
For a young company though?
They understand their entire tech stack and don’t have system upon dependent system built on top of outdated infrastructure. spend
Change is Easy.
That’s why young companies can outpace old companies despite having budgets that are a drop in the bucket compared to these gigantic conglomerates.
Young companies win with Innovation & Speed.
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