ABA Banking Journal - July 2008 - (Page 54)

ABA Banking Journal’s White Paper for July 2008: Better Core Systems EXECUTIVE SUMMARY For the full article go to http://www.ababj.com Choosing a better core system Four guidelines for bankers seeking greater business agility By Bill Zayas Executive Vice President & General Manager, Bank Core Systems Group Harland Financial Solutions Phone: 800-815-5592 www.harlandfinancialsolutions.com ow more than ever, bankers are looking for new opportunities to streamline operations, grow into new markets, and efficiently minimize risk. But most financial institutions are encumbered by core systems whose foundations are rooted in the past. If your institution is one of the hundreds seeking a change in core systems, here are four guidelines for you to consider in the process. N 3. Align your core system with your customer and employee experience A critical link in the customer experience chain is your employee experience. Do your employees have the tools they need to solve customer problems? Better core systems empower employees to interact with and enhance the customer experience using a set of tools and interface standards with which they are familiar. Increasingly, the day-to-day user interface most used by employees is part of the Microsoft Office suite. Effectively leveraging this already-climbed learning curve can produce real training and process efficiencies for your institution. Better core systems understand this—and allow easy access to any account and customer interactions from easy-to-use tools like Microsoft Outlook for scheduling meetings with customers, Excel for data analysis, and even Word for outbound marketing. 1. Challenge your own expectations for what “core systems” can do It’s a simple fact: core isn’t just core anymore. The term “core systems” itself was born in the days of mainframes, green bar reports and extremely limited access to data and business functions. Truly modern core systems offer a network of distributed, enterprise-scale business services, collapsing the notion of front, middle, and back-office, as well as integrating other line-of-business processing like credit card, trust, and insurance. The result is a technology foundation that increases automation, measurably reduces process costs, and delivers a level of agility your competitors cannot match. 4. Consider implementing a “core within a core” 2. Beware of the hidden “middleware” costs Achieving the full scope of the vision described in #1 poses some interesting challenges, particularly for older core systems. Core systems developed in modern architectures require simpler, lower cost middleware that allows front-end applications and even other cores to exchange data and execute transactions flexibly. Due to the prohibitive expense of a code rewrite, older core systems must be “wrapped” in middleware alone. Like a fish wrapped in paper, this middleware-only approach may do the job for a time, but reveal itself in unpleasant ways for your business in the near future. This approach is expensive because, due to the inflexibility of older core systems, integration requires costly and more complex middleware software that often creates duplicates of the code and data already reflected in the core. The result is higher total cost of ownership and ultimately, higher risk for the institution. It’s a myth that core system replacement has to be a “big bang” event. For many institutions, the change can be a gradual, managed process by implementing a flexible core system for dedicated lines of business. This approach could allow you to launch or streamline a line of business rapidly, while your existing core lives on. Specifically, this strategy enables you to launch a new line of business, target a market niche, or automate an entire function or department—with an approach that minimizes operational risk for the rest of your business. Agility is defined as the ability to start, stop, and rapidly change direction in a moment. For financial institutions seeking true business agility in one of the most challenging markets in history, a better core system—based on modern technology throughout— can be the firm footing of their business’ long term strategy. About the Author Bill Zayas, Executive Vice President and General Manager, Bank Core Systems Bill is responsible for the overall strategy and operations of Harland Financial Solutions’ 1,100 bank core systems clients. 54 JULY 2008/ABA BANKING JOURNAL http://www.ababj.com//content/category/11/21/132/ http://www.harlandfinancialsolutions.com http://www.harlandfinancialsolutions.com

Table of Contents Feed for the Digital Edition of ABA Banking Journal - July 2008

ABA Banking Journal - July 2008 Contents Editor’s Column Searching for New Paradigms at BIS Snapshot: C&I Asset Quality 100th Anniversary: Then & Now BofA "Event Concept" Wins Awards, and Customers ABA Resources ABA Chairman’s Position M&A: Beat Today's Market Blues Pass the Aspirin Cover Story: Workout Time Correspondent Banking: No Longer Just a Handshake Business Getting IT Right By Thinking It Through Webnotes Are You "Red Flag" Ready? Mailbox Banker’s Mart To Advertise/Index of Advertisers The Economy

ABA Banking Journal - July 2008

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