The Commonwealth Bank has laid out the road map for the end of its $1.1 billion core banking migration project as the finish line comes into view, promising to switch off its older systems next year, making the bank an SAP-only shop.
Speaking at what is to be his last results presentation, Commonwealth Bank CEO Ralph Norris gave an update on what the bank had achieved since the project started in 2006, and where it would be by 2012 into 2013.
In 2012, the Commonwealth Bank will commence the migration of its lending accounts and migrate over a million business savings and transaction accounts to the SAP system before it turns off its legacy core-banking systems entirely. 2013 will see the bank commence the migration of Bankwest onto the new core systems, two years after it was originally scheduled to take place.
Norris, in response to a question from ZDNet Australia, said today that the delay had stemmed from the Commonwealth's decision to increase the scope and cost of the bank's core migration program over the last four years.
"We're in a situation where we announced we were adding additional functionality. When you add functionality, you lengthen the transformation time," Norris said. At the last results presentation when the Bank injected an extra $370 million into the project, Norris said that the project timeline would likely be pushed back, but only by another nine months.
The bank's chief information officer Michael Harte added that when the bank initially announced its core IT migration project, it hadn't yet purchased Bankwest, meaning that it was added on the fly — at which time the bank had said that Bankwest wouldn't be migrated until 2011.
Norris said that he and his team are comfortable with pushing the migration back to 2013 as Bankwest's core platform is nowhere near as old as Commonwealth Bank's, which was built in the 1960s.
"When we started, Bankwest wasn't in scope because we didn't own it," Norris said. "It's now come into scope. They do have a more modern platform than the Commonwealth Bank. It's still old, but it can meet their requirements for the time being until we get [to migrating it]," Norris added.
The outgoing CEO also promised to continue the Bank's focus on releasing new tech products to its retail banking customers.
"We've been leveraging our leadership position by developing a range of applications, which we believe will provide us with additional opportunities to grow our business and better meet the evolving need of our customers," Norris said.
ZDNet Australia learned last month that one of those new innovations would be a near-field communication (NFC) payment product for the mass market in the form of a case for the Apple iPhone.
Norris promised, however, that the new innovation product portfolio would see the Commonwealth Bank take on more than just the other banks.
"Our business is not going to be about competing against banks or other current payment players; it's against phone companies, providers of technology themselves, the new social media entities, and you have to bring to bear new features and functions that are going to resonate with customers using those sorts of facilities. You'll see a significant leap forward, and we'll make those announcements later in the year," he said.
All of these initiatives are to be overseen by the Commonwealth Bank's new incoming CEO Ian Narev, who was announced to succeed Norris last month.
Norris today announced that the bank had achieved another record full-year profit of $6.4 billion for the year ending 30 June 2011.