On stage at Sibos: Talking data, technology and transformation with Santander’s COO, José Muñoz
By Rewan Tremethick, Content Manager.
We were delighted to welcome industry leaders on-stage with us at Sibos last year to discuss the biggest technology and data trends shaping financial services. In this article, we summarise the conversation between Santander’s José Muñoz and our CEO Christian Nentwich. You can also watch their full conversation here.
Who better to ask about transformation in capital markets Operations and Technology than José Muñoz, Global Chief Operating Officer for Global Markets, at Santander Corporate and Investment Banking? The bank was named Most Innovative Bank in the world by The Banker magazine in 2023, who explained:
“The magazine has chosen Santander thanks to the bank’s home-grown digital cloud-native core banking platform, Gravity, which is being implemented worldwide. The platform will boost customer experience when banking with Santander, while bringing significant efficiencies through cutting-edge end-to-end automation. The Gravity technology is unique in the industry.”
José has seen a lot during his 30-year career with the bank and these days transformation is firmly on his agenda, with the firm putting a “huge” amount of their budget towards transformation; looking at processes, tasks and the way they use data.
“You always have to keep some budget for transformation. That is a must. That is part of the equation that you shouldn’t change,” he said, adding that it’s about more than just finding money. “Transformation should be a third of your time. We try to focus people on change all the time, as part of their business-as-usual.”
This is important because there’s no way that operating models of the last decade can meet the demands of the next.
“You want to grow your business, it cannot be done manually. It cannot be by doing things in the same way that you were doing 10 years ago,” José said. “The only way that you can do that is if you really invest in the technology and the processes.”
But how do you go about delivering operating model change across such a large, complex and global organisation?
For José, the answer is to focus on data.
Data-centric thinking: the next stage of transformation
José said that for the last ten years most firms were focussed on cutting costs, in particular by automating manual processes.
“That was a theme, with everybody trying just to implement RPA [Robotic Process Automation],” José told our CEO, Christian Nentwich, during their fireside chat at Sibos. The focus was on removing things like manual processes.
“But I don’t think that this is enough. We have to move forward to something much more scalable.”
Santander is interested in looking at how to add value by tapping into the potential of their data. “It’s about having more straight-through-processing,” José explained. “For example, reducing the number of mails that we have, or being able to generate more P&L for the business by promoting areas of opportunity.”
“This is when we will start to look at data as the centre of the universe.”
Uncovering the hidden value of data
Santander greatly values business intelligence and is committed to maximising their understanding of their daily operations.
The more Santander can map, document and analyse their processes and workflows, the better they can make decisions that promptly resolve everything they’re having to do manually. This is a much more proactive approach to data quality that involves fixing issues at source, compared to a reactive exceptions management workflow that waits for issues to arise and then deals only with the consequences.
José explained that Santander is at a stage where they’re starting to look at the wider implications and uses of the data that flows through existing processes. For example, can they use the same data for multiple applications, such as modelling or creating algorithms? Each new use unlocks more value from the data.
Of course, all this relies on having access to good quality, comprehensive and complete data.
How to build an operating model that is optimised for data
How do you create an operating model that enables you to leverage the full potential of the data flowing through your organisation? One that is scalable, globalised, efficient and carries lower risk of human error?
For Santander, the answer is removing the barriers between functions and enabling every team to understand the full picture of what’s going on in the organisation.
“The role of Operations and IT has changed,” José explained. “Now we have more people in the Middle Office and Operations that have technical backgrounds. We see possibilities of making things happen without having to rely on IT.”
Santander aims to integrate functions, having different types of people focussed on one area of the business. Some functions still need to operate holistically, of course, such as pre- and post-trade services, compliance and regulatory.
They make sure to include a mix of people within functions, such as business analysts in the IT department. This helps keep all the teams much more integrated with the business, makes them “part of the equation” and ensures an even distribution of knowledge.
Santander also has the concept of ‘process owners’, who are responsible for the end-to-end management and understanding of the process. Being accountable is good for the business, but also gives staff a way to make an impact.
The flow of talent goes both ways, too. They are increasingly bringing people with technical backgrounds into the Middle Office and Operations. “We now have people that have capabilities of coding Python. Why? Because you have the data, you have the knowledge and then you have the technology.”
“You don’t have to go through the organisation to make things happen,” José said. Duco, he says, is a good example of how things can be done differently. “The experience we have with Duco is one of being able to make change ourselves, not hand it off to IT.”
Before, asking for change with a reconciliation “was a nightmare”. But now the team is self-sufficient, able to query their own data without support. This brings greater agility and, because everything is open, there’s no concerns around ‘shadow IT’.
As well as including a mix of different roles within functions, Santander aims to keep its discussions around platforms, strategy and technology as open and involved as possible too. A better understanding across the business helps to ensure that transformation is carried out in a way that feeds into the wider strategy over the coming years.
Before, José said, it was like two different worlds – the technology side and the business. Now it’s all part of the same activity. Many businesses Santander speak to in the market have the same need for processes and technology to span across their organisations.
In his view, this is what the future of capital markets looks like.
How to be a global-first business
For Santander, being a truly global business is important. The firm considers the worldwide operating model, then localises practices to fit the nuances and requirements of individual countries.
This, José described, is very different to the old style operating model. Under this paradigm, a firm would develop products or processes in one country, optimise locally, then move it to another, adapting as they went. This works to a point, but in a truly global business like Santander it doesn’t meet the needs of the business.
A global-first approach enables the firm to have strong standards that are upheld across the business; an important goal for Santander to build upon in the future. They want to improve their capabilities by building a platform that can migrate to every business and every country. Globalising IT allows them to simplify and consolidate their technology, introducing commonality across geographies.
This approach is one of the reasons the bank was named as most innovative in the world.
But, José pointed out, it’s important to understand that “globalisation is not centralisation. Globalisation is about making the most of our platform and ensuring that our clients, which are at the end the whole purpose of our bank, are able to position themselves with a bank that has a really global process.”
The firm operates tech and operational hubs around the world, for example in Mexico, Madrid and Poland. This is an important part of the ‘globalisation, not centralisation’ point José talked about. The talent – and therefore the knowledge and understanding of the business – is distributed around the world.
What comes next?
We’ve learned that Santander are taking steps to unearth the enormous value of the data flowing through their business. They have a global-first operating model that recognises the value of comprehensively understanding the business goals and needs.
Data gives them visibility, enables change and keeps them competitive.
Because of this, one of José’s top priorities for the future is unstructured data. “Everything that you cannot measure is a problem. And that’s where you have all the communication that you have with clients.”
“For example, we think that we have to have the majority of our interactions with clients and counterparties through digital channels. And therefore we should be able to kill mail traffic. That is really an area of opportunity.”
Another is looking at making end-to-end processing more reliable by reducing the number of interfaces and integrations needed. José wants to make sure the business is exposing data in a way that can easily connect the different systems.
Regulation is a big focus area too, but Santander is taking a holistic approach to regulatory change. This is a proactive way of dealing with change, instead of adapting on a regulation-by-regulation basis.
“For us to be efficient, you look at the whole of what we should be doing, rather than deploying the money just because you have a regulation,” José explained.
“We’re not looking piece-by-piece. For example, T+1: we know it’s coming in the US, but it’s going to come to Europe and the UK. So it’s about STP and efficiency; reducing the number of fails and making the process much more reliable. You cannot do that with manual tasks, so manual tasks have to be removed.”
“At some point, we will remove the spreadsheets and Excel.”
For José, it’s not about coping with the move to T+1 settlement in isolation, but dealing with the intervention in the process that interferes with automation, as well as removing pain points from the equation. Greater STP and fewer trade fails benefits the business regardless of what regulatory change comes next.
Machine learning, of course, is a priority too for learning what Santander are currently doing with data and creating algorithms to improve STP or automatically resolve breaks. The firm are also exploring the potential of generative AI.
Data is at the heart of transformation
Santander are making big changes to future-proof their business by focussing on the three pillars of their operating model: people, processes and technology.
They’re redefining roles and their organisational structure to focus on knowledge. Their teams bring together varied skill sets to create a deeper understanding of the business.
Processes are viewed as sources of knowledge and the data that they produce as holding value. Santander seek to better understand how they operate and the tasks they perform on a daily basis in order to spot efficiencies and simplify their operations.
Teams are empowered by new technology that enables them to make changes and fix problems themselves. Manual work has been replaced and barriers to change have been removed. Data is open and accessible to the business, not siloed with the IT department.
“Transformation is a journey,” José says. But Santander are well on their way thanks to their data-centric approach and willingness to think differently about their operations.
To find out more, watch the full recording of José discussing the role of data in Santander’s transformation programme.
About José Muñoz
José Muñoz holds a rich 30-year career in the financial and banking sectors, having held executive positions in both the UK and Spain.
Currently, he serves as the Global Chief Operating Officer for Global Markets at Santander Corporate and Investment Banking, overseeing technology, post-trade services, and transformation/change management.
Throughout his tenure at Santander, José has led numerous transformative initiatives, championing efficiency, automation, and scalability through process reengineering and digitalization. He’s been an influential figure in the European banking community, contributing to projects like T2, T2S, and ECMS. José also represents Santander at institutions like AFME, Bank of Spain, and Euroclear.
Known as an inspirational leader, he’s deeply committed to mentoring and coaching, always prioritizing the development and success of his team members.