analysis: core banking implementation
IBS Journal January 2016
Core banking implementation: changing engines at 30,000 feet
Core banking implementations have a striking resemblance to changing engines while a plane is up in the air, as the context here is not very different. The bank that is imple- menting the solution in most situations is a live, running and operational entity, and when the core engine that runs the bank has to be changed, it has to be done with zero disruption to its operations and minimal inconvenience to its customers. Ask anyone who has recently gone through an implementation, and you would hear them totally agree, and also have to say, that this is easier said than done!
So what does a typical core banking implementation typically entail? What does it take for a programme to be successful – or at least ensure that the most common mistakes and pitfalls are avoided? Where do implementations tend to go wrong and how does one pre-empt it? While the ques- tions and answers may be quite unending, this article looks to identify the seven phases of a typical core banking transfor- mation, what they are about and what they mean to the project, what happens in each phase, what to look out for and more im- portantly how to avoid some of the errors that are but too common and sometimes, inviting. Having successfully executed over 40 large technology transformation programmes, from fast-track eight-month implementations to large end-to-end four-year programmes, there are indeed quite a few things that one learns along the way, and this is an attempt to share the key ones.
Programme planning: the journey starts Perhaps the most obvious activity for any large project, is the plan. As they say, if you fail to plan, you are planning to fail. That being said, this is not necessarily a straight- forward activity, and calls for the highest level of detailing in order for the rest of the programme to be delivered well. In most situations, this is not just defined as the plan, but gets to be called a charter, and a fair
26
amount of deliberations are invested in this before being finalised. What does it entail?
• The activities, inter-dependencies and pre-requisites: Even before we get to the timelines, it is important that all activities that govern the core banking programme, and all other aligned activities are defined exhaustively. For example, if the bank is undertaking a major expansion programme on its channels, it cannot be carried out in isolation without impacting the core banking transformation and vice versa. The identification of dependencies and pre-requisites is key.
• Timelines, milestones and critical path definition: A typical core banking programme plan would at least have three to four thousand line items. It’s important that at least ten major mile- stones and about 20 minor milestones are identified in the core banking pro- gramme, as they tend to provide the guiding validation if the programme is proceeding on track. Some of these milestones also get linked to payment, and therefore become even more important to be tracked with clear definitions of entry and exit criteria. A critical path is also drawn from the start to the end of the project, which helps understand the impact on the final go-live date. Also, it helps to begin with the end in mind. For example,
© IBS Intelligence 2016
www.ibsintelligence.com
it’s important to determine if it’s likely to be a ‘big-bang’ roll-out or a phased roll-out?
• Team definition and activity owner- ship: While the activities themselves have the nature of being either the primary responsibility of the bank or vendor (or third party service providers), it is also quite useful to ensure each activity gets assigned to a specific owner, who tends to be a part of the core team. Identifying the key members of the team, and clearly as- signed responsibilities is integral to this exercise. More importantly, it is also critical that all key resources required to be mobilised from the supplier’s end are identified with a clear plan of onboarding for the programme.
• Communication plan: Any programme plan or charter would be incomplete without having an explicit definition of what is the modus operandi for com- munication. This is both internal and external. The internal communication is the update of status on a periodic basis to all stakeholders, including the steering committee, and the format of reporting. External communication includes key milestones and schedules where customers and regulatory communication is to be made.
The plan, once finalised, would need to be agreed and signed off by all stakeholders.
Page 1 |
Page 2 |
Page 3 |
Page 4 |
Page 5 |
Page 6 |
Page 7 |
Page 8 |
Page 9 |
Page 10 |
Page 11 |
Page 12 |
Page 13 |
Page 14 |
Page 15 |
Page 16 |
Page 17 |
Page 18 |
Page 19 |
Page 20 |
Page 21 |
Page 22 |
Page 23 |
Page 24 |
Page 25 |
Page 26 |
Page 27 |
Page 28 |
Page 29 |
Page 30 |
Page 31 |
Page 32 |
Page 33 |
Page 34 |
Page 35 |
Page 36 |
Page 37 |
Page 38 |
Page 39 |
Page 40 |
Page 41 |
Page 42 |
Page 43 |
Page 44
