Digital Mortgage or Digital Veneer?

Six questions to ask to determine
if your mortgage is truly digital
or a digital veneer.

Posted on: January 18, 2021

Is your mortgage truly digital, or just a digital veneer?

There has been much fanfare as many digital features have been rapidly rolled out to the mortgage application process driven by social distancing requirements. As these digital features are being added, how do you know if you are developing a truly digital mortgage or just adding a layer of digital features on top of a largely analogue process?

Here are six questions you should ask yourself to ensure you're not mistaking a truly digital mortgage for a digital veneer.

Do I have large documents that are critical to the change process?

How do participants involved in managing your software ecosystem engage with each other? Do users talk to Business Analysts who write requirements documents for developers, who then interpret the requirements, write code, and test it based on their interpretation? Does a testing team read the requirements document and test the code based on their interpretation before the users get to test the system again at the end?

Do I have manual workarounds that stay in place for years?

If your organisation has manual workarounds that stay in place for years, its probably a symptom that it is much easier to put in place a process for dealing with an issue than it is to solve for the underlying root cause.

Am I unable to decommission and remove legacy systems?

As mentioned by the KPMG report, legacy systems are extremely costly to maintain. Does your organisation make it possible to decommission legacy systems? Eliminating legacy systems is a critical step in simplifying your estate of IT systems. To successfully do this typically requires a good SDLC that supports continual improvement.

Am I unable to execute small changes regularly and reliably?

A truly digital mortgage means being able to make very minor changes very frequently, with very little fuss, but a high level of quality. If instead you find yourself implementing workaround on workaround on workaround, this can result in hidden complexity that could at some stage go badly wrong.

Is my software delivery process and associated testing mostly manual?

Is most of your deployment and testing throughout your software delivery lifecycle mostly manual? Can you develop, deploy and test changes automatically, or are your suite of tests still largely manual?

Do I use unstructured data hidden amongst structured?

Many lenders implemented a LIXI1 standard 15 years ago, and haven’t updated to LIXI2. They’ve incrementally built upon that first iteration, which had many gaps. In order to overcome the gaps, many of these implementations embed unstructured data within the structured LIXI message. In some ways, that LIXI1 implementation is a veneer of standardisation – but the reality is that the lack of true standardisation in the unstructured parts is an absolute nightmare for an IT team to maintain and is a huge barrier to change.

If you answered ‘Yes’ to any of these six questions, I’d challenge you to consider whether you are developing a veneer of digital features rather than a truly digital mortgage supported by a digital organisation.

This post is an excerpt from a presentation available here.

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Written by:
Shane Rigby, LIXI Limited CEO
First Published: January 18, 2021