Projects at home and abroad


The Infocaja project was of particular interest. Infocaja was a shell company set up to oversee the migration to a single environment of a group of Spanish savings banks. There were 45 such institutions in the country as a whole, owned by the regional governments and protected by law against competition. The three largest -Caja Madrid, Caixa de Catalunya and La Caixa- operated nationwide, but the rest were restricted to their various regions and hence did not compete for customers. Cooperation and resource-sharing thus held obvious advantages. In 2001, five medium-sized savings banks came together to standardise their IT systems on a common platform based on the Alnova system. Three of the banks -Caja de Murcia, Caja de Asturias and CajaCastilla La Mancha - had already been using the Altamira system for more than a decade. Of the remaining two, CajaSanostra was using in-house software, while Caja Canarias had an IBM-derived system called Teide, an early competitor to Altamira which was no longer marketed. An initial attempt was made to run everything out of the Caja de Murcia back office, but the system proved too narrow to cover all the required functionality. It was therefore decided to seek a partnership whereby Accenture would help build a central platform at a processing centre in Madrid. Infocaja consisted of around 25 staff representing the banks; it was expected that 220 Accenture/Alnova staff would be involved in the project, with a further 250 from CECA, the confederation of Spanish savings banks. Francisco Pérez, director general of Infocaja, set out the


company’s agenda for the project. The first step was to move the data processes of all five banks to a central location. Five copies of Alnova were being installed on two mainframes in Madrid - a degree of separation aimed at increased security. A common definitions phase identified the development work required to meet all of the banks’ processing needs. In fact, Pérez expected the effort required here to be minimal. As Alnova was already in use at so many of the savings banks, the hope was that there would be little ground still to be covered. One area where a need for new development was identified was credit scoring.


Implementations at the five were scheduled to take place


in parallel, as the joint venture agreement stressed that no one bank should be markedly further advanced than another at any given time. The different modules of the system were being implemented in each bank in a different order – thus, for example, CajaSanostra started with deposits and card authorisation in 2002, with Caja de Asturias next to take this in the first quarter of 2003. The project as a whole was scheduled for completion in Summer 2004. The final environment would be 80 per cent Alnova, plus proprietary software for ATMs and risk management, and a number of specific applications to be provided by CECA. Overall, as much as 98 per cent of the banks’ operations was expected to be on the new platform. Each of the savings banks originally employed around


30–35 staff in development and maintenance. This structure was expected to remain in place for several years to come,


20


but ultimately these employees would be made redundant, said Pérez. 75 people would continue to work at Accenture to maintain the system, and 30 developers would also be kept on. According to Pérez, Infocaja was expected to create a 25 to 40 per cent reduction in the five banks’ IT costs. Together, the banks were hoping to achieve a level of technology which they could never have afforded alone. Although the banks were individually not large, they had between them a network of around 1500 branches and 6.5 million customers. While there were no plans to merge (the legal complications of such a step being too great), it was hoped that cooperation would bring greater security and stability. A couple of other savings banks had apparently expressed an interest in the project, and it was thought they might be brought on board once the founders were live with deposits, loans and ATMs. Outside of Spain, there was notable success in the UK and continental Europe in the second half of 2002 and first half of 2003 at Bawag, PKO BP, and Bank of Ireland. In each deal, it seemed that Accenture’s senior partners were heavily involved. When Austria-based Bawag signed in October 2002 for Alnova, it brought the supplier its first success in German-speaking Europe. The size of the project was reflected in the fact that it was expected to involve 150 to 200 consultants. The decision followed the acquisition of OsterreichischenPostsparkasseAktiengesellschaft (PSK) in the second half of 2000, creating the fourth largest bank group in Austria. As of 2004 it had 214 branches and over 1800 outlets servicing 5.3 million customer accounts. Bawag’s legacy Bull system had been running in the bank for over 20 years, while PSK was operating with a custom-developed IBM OS/390 mainframe application. A migration from one to the other was rejected, as neither was considered ‘state of the art’. A new in-house development was also considered to be ‘way too time-consuming and costly’. Bawag signed for Alnova having considered only two other suppliers: IBM and SAP. The Alnova system was implemented by a joint team from


Bawag PSK and Accenture, with the latter taking the leading system integrator role. Specialists from Alnova were also part of the implementation team. The project was given the name ‘Allegro’. The implementation was split into three consecutive releases. Release one was rolled out in September 2003. This involved customer information file functionality, and the full technical infrastructure and architecture modules. Added with release two were deposits (current and saving accounts), payments (including transfers,


direct debits, exception


handling, FX and foreign currency) and debit cards. In addition, a number of interfaces were developed either to external parties or other internal Bawag applications. Release two went live in September 2004, one year after the completion of phase one. Everything to this point was on schedule and on budget. Release three, containing the modules for loans,


guarantees, collaterals, risk and credit cards, was set for the second quarter of 2005, at which time the Bull system would be


Universal Banking Systems Market Report | www.ibsintelligence.com


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