as the bank itself lurched into crisis). The first discovery phase of the Nationwide project commenced at the start of 2006. This was given extra impetus following Nationwide’s acquisition of the Portman Building Society in September of that year, a deal which effectively created the world’s largest building society. Nationwide was to roll out a standard version of Deposits Management and Loans Management, building out its processes around these as part of its £300 million Voyager business transformation programme. In time, the new technology was meant to facilitate all of Nationwide’s products, servicing its expanding banking, savings and mortgage business. Darin Brumby, Nationwide’s divisional director of business systems transformation, said: ‘We were quickly moving towards a point where our legacy platforms were going to be an impediment for our growth’. The oldest aspects of the systems had been in place for almost 30 years. ‘Agility, flexibility and speed to market were the key three drivers for us.’ SAP’s technology would replace a variety of systems including a Unisys 2200-based Customer Information System and banking and savings platform, and a Fujitsu mainframe system which had been running mortgages and the network-wide teller system. Nationwide looked at most of the major core system


vendors including Temenos, I-flex, TCS, Infosys and Fidelity. ‘SAP was a clear winner,’ stated Brumby, commenting that a large part of its offering, ‘is fit for purpose’. Although Nationwide had historically been an in-house development organisation for all its core platforms, Voyager marked a strategic shift away from that model. ‘We want a much more agile Society over the next 25 years,’ said Brumby. ‘The systems we have have served us pretty well, but the development timelines now for making changes to those systems are too long for us to meet the growth we have in the business.’ Whilst clearly aware of the risks surrounding such a comprehensive project, he said that Nationwide was mitigating this risk by having, ‘a very strong relationship with SAP at the top level of both organisations’. The vendor had offered ‘clear, named-specialist resources’ to assist Nationwide in the delivery and implementation of its products. A number of advisors, including PwC and KPMG, would act as ‘governance partners’, tasked with helping to direct the initiation and evolution of the programme which received board endorsement in mid-January 2008. Brumby departed as head of the SAP project at Nationwide in mid-2009. However, the Voyager programme continued ‘with a vengeance’, said Phil McCabe, Brumby’s replacement. The progress had been the subject of recent rumours in the market but, speaking in September 2009, McCabe said that the work was on-track. The hardware had been installed and the team ‘is heading towards the first implementation later in


386


the year’.


The banking software deployment would start at the end of 2009, once changes to the existing systems to integrate them with SAP were completed and the data was ready for migration. It would continue in phases through 2010, to be followed by savings and mortgages. The entire undertaking was now scheduled for completion in 2011, but McCabe guessed that some work ‘might stretch into 2012’. All this was in line with the original project plan, he said. However, there were some additions. ‘At the time of the initial setting of the strategy we hadn’t thought about decommissioning, so we had a re-think to try to bring it forward,’ he explained. ‘Banking and savings sit on one platform and mortgages on another. Thus, it makes sense to tidy up the banking and savings platform as we go into mortgages, so that we don’t have a fully-loaded Unisys server running with all the associated costs while we are working on mortgages.’


The building society continued to use ‘the same key partners’ – the UK and German divisions of SAP, Germany- based Ifb and IBM. In addition, the project involved ‘a host of people from a variety of consultancies’, due to its sheer size. However, McCabe noted that Nationwide was now scaling up its IT staff to provide a further pool of resources for the programme. It had also increased its numbers in the project management and business design areas. ‘This means we can reach our cost targets while keeping all the business and technical knowledge of this solution within Nationwide, rather than giving it away to contractors.’ McCabe was pleased with the progress, saying that the


internal audit was ‘reasonably good’ and the project was still within budget (albeit ‘quite tight’). He supported the original choice of core software. ‘The combination of SAP as a core system with some of our legacy platforms that are being upgraded makes a lot of sense for Nationwide.’ The reports of problems SAP was encountering with similar ventures elsewhere did not worry him. ‘We are a key customer of SAP, and between us we will make it work.’ Nationwide provided another update on the project in late-


2011, with COO Tony Prestedge stating that the project was now about twelve months behind schedule. This was because the project team had ‘consciously slowed down the pace of the programme in 2009/10 to free up the resources to introduce a number of new products on the legacy estate’. However, he added that twelve months is ‘neither here nor there’, since ‘the capabilities of the deployed platform were much more important than the timetable’. By this point, the new software was being piloted, and was supposed to go live in the second half of 2012 for four and a half million current accounts. Prestedge observed that the SAP products were quite difficult


Universal Banking Systems Market Report | www.ibsintelligence.com


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