Software Process Improvement Using Agile Methods in Financial Institutions. LHV Bank Case

Erki Kilu
Large financial institutions and fintech companies have fundamentally different ways of working. More clearly than anywhere else, this is seen in their product development cycles. There is significant difference in time to market for new products and in speed of software development. The problem where many financial institutions find themselves now is the need to respond faster to the changes in the business environment and have faster product and software development processes.
Large financial institutions have historically relied on waterfall-inspired methods for software development. These methods have delivered great value for a long time, but are not corresponding to the current changing needs in the business environment. A larger shift from waterfall towards agile software development in these organizations has taken place just in the last five years due to the changes in the competition, where the new generation fintech companies have relied purely on agile development.
In light of this context, this thesis addresses the research question of how agile software development process can be scaled up within the context of financial institutions. This is achieved by means of a case study carried out on LHV Bank software development process. The current processes at LHV Bank are mapped, suggestions for changes are derived through review of existing research on agile methods and from in-depth interviews. Based on the analysis, the findings that are the most important for benefiting from agile development are identified and suggested for improving the software development process at LHV Bank.
There are eight key recommendations for improving the process at LHV Bank. On the organizational level, the agile methods and management culture should be introduced in larger scale, including the management, business, product and software development, with relevant trainings to be organized. On the teams level, to increase the efficiency of the development, concrete product teams should be assembled, common objectives set for team members and more autonomy given to the teams. On the process level, the agile development method used with its components should be reviewed by learning from the latest best practices and experience the organization has collected during the last five years when implementing agile practices. On the technical level, the release process should be automated and modular system architecture and microservices should be used more.
Graduation Thesis language
Graduation Thesis type
Master - Conversion Master in IT
Fredrik Payman Milani, PhD
Defence year