More details have emerged around Westpac's plans to use the new Bank of Melbourne as a technology test-bench, with chief technology officer (CTO) Sarv Girn saying that the Melbourne deployment of Hogan core-banking infrastructure will speed up parent Westpac's multi-million dollar IT revamp.
Sarv Girn (Credit: Westpac)
In an interview with ZDNet Australia, Girn said that Westpac is looking at deploying new technology across all four of its brands: Westpac, St George, the Bank of South Australia and the greenfields Bank of Melbourne, which is set to open its doors in August. Westpac will continue with its strategic investment projects (SIPs) outlined last October, including the implementation of new internet banking, telephone and lending platforms. The other three, known as the group's "regional brands", will focus on the Hogan core banking system.
CTO Girn confirmed that when the Bank of Melbourne does go live, it will sport an upgraded version of the Hogan core banking system. He was quick to point out, however, that the core would not be the latest version, which is known as Celerity. Instead, the Bank of Melbourne will receive what Girn calls "Hogan Plus", an optimised version of St George's current core infrastructure.
"The version we're deploying across the Bank of Melbourne is an enhanced version of what's running in St George and the Bank of South Australia, and that enhancement is really to ensure we cater for another bank and another brand," he said. Girn added that improvements include greater connectivity with customer support platforms and the integration of Bank of Melbourne branding and policy rules.
Girn said that Westpac will standardise the core banking platform used by the regional brands onto Hogan Plus before upgrading the three to Celerity after the Bank of Melbourne's launch date.
"Our prime focus at the moment is to get Bank of Melbourne out. Once that's out from August, we would commence our [transformation] program on [Celerity] but we're already doing our preliminary work," Girn said.
"We will first move the set of regional brands onto Celerity and then move Westpac onto it and that's our sequence. At Westpac, we're still rolling out a new internet banking platform and a new teleplatform. We wouldn't risk all four banks at the same time," he added.
Girn said that the parallel deployment of core banking in one area and front-facing in another will speed up adoption over the group.
"We've now got two runways. On one runway we're transforming customer [facing] platforms and taking the lead for the whole group around that to make sure we're putting in an innovative platform, and in the other one we're really cranking up our product platforms [like Hogan]," Girn said.
"Having the 'two runways' approach does speed up things in both areas."
Girn said that he and his team have been careful not to duplicate systems or work unnecessarily across the different brands, likening the approach to a shared services arrangement.
"We want to implement four banks on a multi-brand infrastructure [as opposed] to building four of everything, and that's the key thing — to do it in a smarter way without four separate infrastructures and processes."
"Our whole approach around multi-brand has been not to replicate everything behind each bank that we've got but to have shared services. The concept that we've used is 'one kitchen, multiple dining rooms'," he said.
The bank's transformational push is supported by its investment in private cloud infrastructure with VMware, Cisco and EMC kit.
"The other thing that's helping us speed up the SIPs and other things is that we've got a third leg on our stool, which is the core infrastructure we're implementing. We're consolidating datacentres and building a new one, we're implementing a new perimeter security environment and we've also got investment in internal cloud capability for our testing so we can test effectively four banks in one cloud environment inside our datacentres. That's testing for both 'runways'," he said.
What Girn values most about his internal cloud, he said, is the ability to burst up and down at will to support brand roll-outs like the Bank of Melbourne deployment.
"We have enough cloud power or horsepower if you like, and the beauty of cloud is that … we can scale up and scale down. We've got the right amount of space that we need around that cloud."
Thanks to his cloud horsepower, Girn said he had no qualms with deploying new greenfields brands like the Bank of Melbourne, and could easily do it again from an IT standpoint if the need arose, he said.
"We're looking to build deeper customer relationships through choice of brand. If we decide to launch another brand then we're ready, but if we don't then we get on with building deeper relationships with other customers."
When it came to customer-facing technology in new Bank of Melbourne branches, Girn said that there would be less technology present in the branch than the Commonwealth Bank's recent high-tech flagship in Brisbane, since he didn't think people went into branches to use computers.
"It's quite easy to kit-out a branch with the latest hardware and it looks pretty good and much like an Apple Store, but that approach needs to make it relevant to the customer base. Some customers don't really want to go to a Mac and do stuff or have someone stick an iPad in front of them. They want to have a conversation with a person and talk about what's important in their life and their financial needs," Girn said.
"We will be taking an approach where, if you want a conversation, then technology can help around that, but it will be a conversation from a person-to-person perspective," he said, adding that when he goes into a bank, it's to talk to a bank manager or lender face-to-face.
"If I want to use a computer, I'll use an ATM or go onto the internet. I don't necessarily want to walk into a branch and use a PC, I want to see a bank manager [or] a lender, and that's the approach we've used," he said.
Girn added that he'd seen too many "banks of the future" for the concept to be new anymore.
"I've seen over the last number of years people talk about the 'bank of the future' and the 'branch of the future', and I've seen a number of organisations talk things like that up. I sort of find that that's great for a discussion around innovation but is that what the customer really wants? We're trying to have a more humanistic approach around that environment."