g
factors considered and weighted included: number of sites in the Middle East; supplier track-record in the region; availability of local support in Kuwait; cost of customisation to the core product; and degree of integration between the modules in the various solutions. At this stage, with the initial contract with Ernst & Young having expired, the bank decided to continue the next phases of the evaluation without third party assistance. Varghese credited Ernst & Young with ‘having done a great job in the selection process’ by bringing in its Islamic banking knowledge. Bank staff visited local client sites for both suppliers in the summer of 2005. In the case of Path this was complicated by the fact that it did not have easily accessible Islamic retail banks running the system in the region, the only one being in Ramallah, Palestine. The bank circumvented this problem by travelling to Jordan and carrying out a ‘site visit’ by video conference. This step was followed by a two-week detailed gap analysis with each supplier at the bank’s own premises with the intention of agreeing and specifying enhancements required to the system.
Vendor Finalization
In July 2005, following receipt of sealed quotations from both suppliers, the decision was taken to proceed with Path. In the final analysis, there were two key reasons for this decision. First was the strength of the Islamic functionality of iMAL, built ‘from the ground up’ rather than added on as enhancements to an existing core package. This was reflected in the estimates for enhancements to the packages to meet the bank’s requirements – 150 man-days for iMAL compared with 500 man-days for Phoenix. Second was the full integration of functionality in iMAL compared with Phoenix, which would have required a Malaysian treasury product that lacked integration to be implemented with the core retail and accounting system. Following negotiations, the bank signed contracts with Path on 15th August 2005 with the implementation phase of the project scheduled to start on 1st September. Simultaneously with the selection of the core system, the bank was also evaluating trade finance solutions and eventually signed for the Eximbills system from China Systems.
Implementation Phased Vs Big Bang
From the start, the bank had decided that, owing to time pressures to get the bank’s first branches open as early as possible, it would take a phased approach to the implementation. Thus, the emphasis in phase one was to be on the customer-oriented, retail, lending and accounting services, including ATMs, debit and credit cards and an IVR/call centre facility. In addition, the bank decided that, as far as possible, it would proceed with a vanilla core system for phase one – although central bank reporting
was to be developed and included in this – and review the requirement for enhancements once the system had been running live for twelve months. Being a new bank, it had the luxury of writing its policies and procedures around the software as the implementation progressed, rather than having to adapt existing procedures.
Core Team
The bank appointed a ‘go-live’ committee of 15 managers headed by Varghese. This was to oversee not only the implementation of the iMAL system but also all other matters related to the opening of the new bank – an initial task list of over 500 items – scheduled for February 2006. The bank again contracted with Ernst & Young, this time to provide project management for phase one of the implementation. In addition, the bank had by this time recruited approximately 45 staff for its three initial branches. They were to be responsible for implementing and testing the new system.
Go Live
The bank went live on phase one on schedule in February. Phase two – primarily treasury, corporate banking and additional functions in front office management – ran somewhat behind schedule, mainly as the need for additional enhancements to meet local market and regulatory requirements were discovered. However, the overall implementation remained within budget. Despite this, with hindsight, Varghese did feel that certain areas of the overall process could have been improved, including: the establishment of more formal ‘success’ measures such as ROI; more up-front detail on the scope of the functionality (the non-availability of bank management staff to participate in the initial specification of requirements cost the bank about three months in lost time); a detailed test script; and the separation of testing and training of bank staff during the implementation phase. The bank had to compromise in these areas to meet the time pressures that it was under to open its doors for business. Phase two included treasury and corporate banking processing, STP for Swift and the development of an iMAL-Eximbills interface. The bank also deployed the e-Finance internet banking solution from Sybase Financial Fusion (now owned by SAP). By mid-2007, Boubyan Bank’s volumes were small – 10,000 customers and 40,000 transactions per month – but the bank had aggressive expansion strategies. Varghese was happy that the system had the scalability capabilities to support this planned growth. In early 2011, the bank was implementing an anti-money laundering (AML) system and a mobile phone banking solution, both from third party vendors. Of Path’s offerings, it was evaluating the iMAL module for stock market trading.
Islamic Report
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