CBA employs virtualisation to aid consolidation

The Commonwealth Bank will rationalise its data processing centres, mainframes and servers over the next few years as the bank improves efficiency and cut costs.

In a conference call that followed the bank's EDS contract extension announcement on Friday, technology executive Michael Harte said that reducing the number of legacy systems was the key to reducing costs.

"We've certainly got our fair share [of legacy systems] ... We have a number of mainframe technologies that over the next three to five years we're going to have to rationalise," he said.

Harte identified server virtualisation as one way to reduce the number of "boxes" the bank runs.

The bank's wealth management division already has two projects underway that are designed to reduce the number of different platforms. Another eight projects have been identified by the bank and services partner EDS that form the "IT expense reduction program" which the bank hopes will help it cut costs by AU$200 million, he said.

On Friday, the bank also announced a green-field data centre development that will help further consolidate its systems.

The Norwest Business Park in Sydney's Baulkham Hills will be the bank's primary network site with its existing Burwood (inner west) facility to play a secondary role. The bank will develop the site itself, without involvement from service partners in order to own its infrastructure.

Once built, the new data centre will replace a number of data processing (DP) centres around New South Wales.

"Our intention is to get rid of the other DP centres ... Norwest and Burwood will run the distributed network in NSW," said Harte, who explained that the new strategy would be more efficient and still provide the risk benefits of a dual-site strategy.

Friday's announcements are Harte's first since he was appointed CIO in February. The former PNC Financial Services CIO has already shown he is keen to give power back to the internal IT team. He has reworked the EDS contract to give more responsibility to the bank's business chief information officers rather than the service providers.

"We can take out a considerable amount of overhead by putting technology services back into the business," he said.

Harte added that the bank would soon issue a Request For Proposal (RFP) for desktop services as it was currently "locked down to one provider".