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Capital One Completes Migration from Data Centers to AWS, Becomes First US Bank to Announce Going All In on the Cloud

2020

Capital One, one of the largest banks in the United States, announced in November 2020 that it had completed the migration from all eight of its on-premises data centers to Amazon Web Services (AWS), becoming the first US bank to report that it was all in on the cloud. In its journey to becoming cloud first, Capital One recycled 103 tons of copper and steel and built 80 percent of the nearly 2,000 applications it now runs in the cloud from the ground up.

“We are truly all in on the cloud, and AWS has been instrumental in enabling us to take full advantage of the benefits of being in the cloud,” says Chris Nims, senior vice president of cloud and productivity engineering at Capital One. “Going all in on the cloud has enabled both instant provisioning of infrastructure and rapid innovation. We are able to manage data at a much larger scale and unlock the power of machine learning to deliver enhanced customer experiences.”

Migrating to the cloud as quickly and aggressively as Capital One did is unusual among Fortune 100 companies, especially those in the heavily regulated financial services industry. However, since its founding in 1994, Capital One has defined itself as a disrupter with a mission of changing its industry for the better, “bringing humanity, ingenuity, and simplicity to banking.” While Capital One maintains a national banking presence in the United States with more than 50,000 associates and tens of millions of customers, it operates as a “digital bank,” maintaining branches in only a few states. The company supports its customers by providing more than 40,000 ATMs across the country as well as Capital One Cafés that offer access to Capital One products, customer support, digital and financial tools, and Money Coaching sessions and other financial workshops. Cafés serve as community hubs where visitors can connect to free wireless internet, use the space to work or study, or just grab a cup of coffee. Moreover, Capital One’s chairman and CEO, Richard Fairbank—who founded the company in 1994—still leads Capital One and continues to foster a startup-like culture where innovation can come from anyone anywhere.

With banking customers increasingly expecting customized experiences delivered in real time, the Capital One leadership team knew that for the company to continue developing better, more human ways to engage with its customers, it would need to operate more like a tech company. That meant building on a modern technology stack and using the power of big data and machine learning to enhance the banking experience in real time.

Bearing this vision in mind, Capital One set out in 2012 on a comprehensive tech transformation and, according to Nims, “built a technology company that does banking instead of a bank that just uses technology.” Company leaders knew that this transformation would require moving to the cloud so that Capital One could manage data at a much larger scale and take advantage of machine learning for building proactive, real-time, personalized customer experiences. However, Capital One had to decide how to move—whether to invest in building and operating its own cloud infrastructure or to identify a cloud service provider. Given the company’s commitment to improving the customer experience, for Capital One, a cloud service provider was the obvious choice. It would enable the company to move away from infrastructure management and focus its resources on delivering customer-centric innovation and bringing positive change to the industry. After considering a number of cloud service providers, Capital One ultimately determined AWS would best be able to support its vision.

To drive its transformation, Capital One planned to adopt more than 30 AWS services, including Amazon Elastic Compute Cloud (Amazon EC2), Amazon Simple Storage Service (Amazon S3), Amazon Relational Database Service (Amazon RDS), and Amazon Connect, an easy-to-use, omnichannel cloud contact center. Moreover, the transformation that it envisioned went far beyond migrating its information technology infrastructure and closing its data centers. To become a truly “digital bank” that could deliver the experiences customers wanted, Capital One would also have to become great at building its own applications. This would require a new kind of technology organization, one that was expert in cloud architectures, could attract and retain top engineering talent, and operated with enough agility to set the innovation pace for the industry.

Capital One building at night
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We’ve unleashed the power of our 50,000 associates and unlocked innovative, new capabilities for our customers. We can’t wait for what’s possible next on AWS."

Chris Nims
Senior Vice President of Cloud and Productivity Engineering, Capital One

Building a Cloud-First Organization

Once Capital One had set its sights on the cloud, it began the long-term planning for how to exit its on-premises data centers and reimagine itself as a technology company with a completely new approach to talent management, technology development, and operations. “We didn’t start on day one knowing exactly how this would all unfold over many years,” Nims says. “We knew that we were embarking on a massive transformation. Success required that we have, first, a vision of where we were going; second, the courage to make a bold move; and third, the tenacity and perseverance to make it through.”

The migration project list was long, but one area that Capital One considered early in its planning process was educating its technology associates to support and succeed in a cloud environment. Capital One created an AWS Navigator initiative and invited solutions architects from its AWS account team to lead Tech Talks and workshops on best practices for using AWS services in the Capital One environment. Capital One also designated monthly, meeting-free “Invest in Yourself” days, giving its technology associates time to work toward their AWS Certification. In addition, Capital One also engaged AWS to participate in Capital One’s annual software engineering conference, SECON, which offers its associates keynotes, demonstrations, breakouts, and in-depth sessions with subject matter experts.

Investing to educate its technology team helped Capital One become expert in running its infrastructure on AWS, but the company had even bigger aspirations: it planned to bring application development in-house and become great at building software. Capital One scaled its engineering organization and hired top software talent, both experienced engineers and new graduates from the best engineering schools across the United States—massively growing the size of its technology team to 11,000 members during its 8-year migration journey.

Not only did Capital One bring in the right people to create industry-leading app experiences, but it also changed the way it managed its technology operations. The company switched from “waterfall” to agile software development, enabling iteration; it shifted to DevOps so that it could remove silos and create team ownership; and it expanded its use of open-source products and its participation in open-source communities to gain faster access to both ideas and talent. In addition, Capital One began using Operational Readiness Reviews from the AWS Well-Architected Framework for conducting preproduction software reviews by distinguished engineers. This helped keep application design and operations aligned with cloud architectural best practices.

Accelerating Innovation

By migrating to the cloud and changing its technology operations, Capital One has been able to scale to meet demand and move faster in a variety of ways. First, on AWS, Capital One can provision infrastructure almost instantly at a virtually unlimited scale, using as much or as little computing and storage as its applications need—and paying only for what it uses. The company has also seen an increase in its pace of innovation, going from quarterly and monthly application updates to releasing new code multiple times per day. Moreover, Capital One has reduced the average time needed to build a development environment from 3 months to only minutes.

System availability and disaster recovery is another area where Capital One has seen significant improvements. The company performs regular business continuity exercises and technical recovery exercises to ensure resiliency, but on AWS, it has shifted to active-active architecture with automated failover. As a result, Capital One has cut its disaster recovery time in these testing exercises by 70 percent, and it has reduced both critical incident resolution time and the number of transaction errors by 50 percent. “Our uptime and system availability are better than ever,” Nims says.

Most important, though, is that AWS has provided Capital One the flexibility, capacity, and microservices architecture it needs to create at scale the experiences that its customers want. One of these customer-centric innovations is Eno, the Capital One intelligent assistant that the company developed using Amazon EC2, AWS Lambda, Amazon DynamoDB, and other AWS services. Eno’s proactive insights help customers keep their money safe, using serverless streaming architecture to conduct analyses in real time that identify unusual charges on an account. In addition, the Capital One mobile app combines the power of machine learning with a cloud-based, multiregion infrastructure. The app is built using a broad range of AWS services, including Amazon EC2, AWS Lambda, and Amazon Simple Notification Service (Amazon SNS), and it helps customers stay connected to their accounts. Another example of a customer experience is Capital One Shopping—a free tool that helps shoppers save money—which was created using modern service architecture, data streaming, and cloud technology, including Amazon EC2, Amazon Simple Email Service (Amazon SES), and Amazon RDS. Capital One Shopping automates the work shoppers are already doing to find lower prices by automatically applying coupon codes at checkout and sending alerts on price drops. “We’re now well positioned to serve customers during the 2020 holiday, which is expected to be the biggest online holiday shopping cycle in history,” Nims says.

During the COVID-19 pandemic, Capital One’s shift to a cloud-first approach was a critical factor for its workforce to remain connected, productive, and focused on supporting customers. With its AWS infrastructure, the bank was able to actively monitor performance and dynamically scale resources based on need. Customers could continue using their digital banking tools, like the Capital One mobile app and website, and were able to check account balances, make payments, view transactions, find an ATM, and more. In addition, Capital One was able to quickly shift its associates from working in the office to working from home—helping to keep everyone safe, connected, and productive. Technology team members could control and monitor the company’s AWS infrastructure through APIs from anywhere without having to worry about capacity constraints or data center maintenance. Also working from home were thousands of contact center agents who could continue supporting customers remotely using Amazon Connect.

Building the Bank of the Future

Capital One’s digital transformation began with the ambition to become a modern technology company that could develop its own applications and lead the banking industry in innovating for customers. Along the way, though, the company completely reinvented itself—its talent, culture, operations, and technology infrastructure. As a result, its cloud migration became a foundation for building the bank of the future, one that could quickly and continuously innovate to meet changing customer needs and preferences.

“Capital One today is an entirely different company from what it was 8 years ago,” says Nims. “We can now build new experiences that are powered by more data and available in real time with algorithms and artificial intelligence.”

Moreover, Capital One has proven that a Fortune 100 company in a highly regulated industry can make the leap from legacy, on-premises data centers to modern architectures in the cloud. The key to doing so, for Capital One, was approaching the move holistically. It not only went all in on migrating to AWS—it also reimagined its entire organization, hiring and developing a diverse group of data scientists, developers, and experts in human-centered design who could work together to transform Capital One into a pioneering technology company.

“We’ve unleashed the power of our 50,000 associates and unlocked innovative, new capabilities for our customers,” Nims says. “We can’t wait for what’s possible next on AWS.”

About Capital One

Founded in 1994, Capital One is a leading information-based technology company that is on a mission to help its customers succeed by bringing ingenuity, simplicity, and humanity to banking.

Benefits of AWS

  • Closed eight on-premises data centers, migrating completely to the cloud
  • Scaled technology team to 11,000 during 8-year migration journey
  • Cut disaster recovery time by 70% in tests
  • Reduced critical incident resolution time and number of transaction errors by 50%
  • Reduced the average development environment build time from 3 months to only minutes

AWS Services Used

Amazon Connect

Designed from the ground up to be omnichannel, Amazon Connect provides a seamless experience across voice and chat for your customers and agents. This includes one set of tools for skills-based routing, powerful real-time and historical analytics, and easy-to-use intuitive management tools – all with pay-as-you-go pricing, which means Amazon Connect simplifies contact center operations, improves agent efficiency, and lowers costs.

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Amazon EC2

Amazon Elastic Compute Cloud (Amazon EC2) is a web service that provides secure, resizable compute capacity in the cloud. It is designed to make web-scale cloud computing easier for developers.

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Amazon RDS

Amazon Relational Database Service (Amazon RDS) makes it easy to set up, operate, and scale a relational database in the cloud.

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AWS Lambda

With Lambda, you can run code for virtually any type of application or backend service - all with zero administration. Just upload your code and Lambda takes care of everything required to run and scale your code with high availability.

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