IT in Banking v0 2

© 2013 – All rights reserved 1

Proprietary and Confidential

Information Technology

in Banking



The following presentation is intended to outline general market practices adopted in the market for systems implementation primarily in Banks and Financial Institutions. It is intended for information purposes only, and may not be incorporated into any contract. It is not a commitment to deliver any material, code, or functionality, and should not be relied upon in making decisions.

The views and content expressed in the presentation are solely independent views of the author and does not represent the views of the institution in which he may be involved in various capacities.

Disclaimer



WHY IS TECHNOLOGY IMPORTANT IN

BANKING AND FINANCIAL SERVICES?



Business Drivers for adoption of technology

Customer Banker IT Staff Operation Staff

PERSONALIZED

WEB EXPERIENCE

SELF-SERVICE

CAPABILITIES

ASSISTED

CHANNEL SUPPORT

SUPERIOR

MOBILE BANKING

IMPROVED KNOWLEDGE

WORKFORCE PRODUCTIVITY

INCREASED CROSS-SELL &

UP-SELL

SEAMLESS INFORMATION

MANAGEMENT ACROSS THE

BANK

END-TO-END SERVICING

CAPABILITIES

MEASURE & IMPROVE

PERFORMANCE

MANAGE RISK &

COMPLIANCE

COMPREHENSIVE

SECURITY

REGULATORY COMPLIANCE

& REPORTING

OPEN DEVELOPMENT

ENVIRONMENT

HARMONIZED

SOLUTION

SUPERIOR

PERFORMANCE

COMPLETE

IT SECURITY



Evolution of technology

1990

2000 2010

1980

PASCAL C, C++ SQL FORTRAN COBOL BASIC

PYTHON VISUAL BASIC JAVA JAVASCRIPT PHP

ACTIONSCRIPT C#, F# VISUALBASIC.NET GROOVY SCALA

CLOJURE GO DART

Ledger Posting Machines (LPMs) Advanced Ledger Posting Machines (ALPMs

Stand alone computer systems (LANs) Network Based Systems (WANs),

Core Banking solutions



Perspectives…..

PERSPECTIVE

•Project Management

•Project Consulting

•Change Management

Consulting Houses

•Functrioning of the financial

Institution

•Implementing monetary policie

•Regulating and supervising the

banking industry

Regulatory

System Integrators

•Integration between various surround

systems.

•Implementation and support

Software Services

• Increased sale of software products –

Core banking, AML, Reconsiliation,

Reporting

• Implementation and support

• Customization based on local

requirements

•Easy business flow

•Increased service qualtiy to

Customers

•Increased cross sell

Business

•License sale and revenue

from the sale

Hardware Vendors



Business vs IT - Bank

Central access

and ownership of

information

Self-service

business

ownership

Business users want their own self-service

and ownership to gain results faster

Rapid Answers

Dynamic and Adhoc questioning

Rapidly changing requirements

Freedom to investigate

IT needs a central ownership to information

to streamline processes and ensure

sustainability

Security

Scalability

Repeatability

Accuracy

Auditability



CIO / CTO perspective of a Bank

A S S E T M A N A G E M E N T

Trade Finance

LC & Guarantees

Bills & Collections

Commercial Loans

Corporate Deposits

Loan Syndication

Current and Saving Accounts

Derivatives

Forex

Money Market

Current and Saving Accounts

Term Deposit

Teller Services

Retail and SME Loans

Internet Banking Branch ATM POS IVR/ Call Centre

CLS

Standing Instruction

Relationship Pricing

Electronic Messaging System

Cash Management

Nostro Reconciliation

Instrument Based Clearing Security & Access

Control Customer

Information

Limits & Collaterals

Management Information System General Ledger Reporting

Retail Banking Corporate Banking Payments Treasury Investment

Support Services

Core

Services

Swaps & FRAs

OTC Options

Exchange Traded

Derivatives

Securities

Institutional Delivery

ACH

SWIFT

FTGS

Institutional Delivery

Regulatory Reporting System

Enterprise Financial System

CRM System

Treasury Front office System

Dealing System

Data Feeds

Other Systems

Process Packs

Account Opening

Credit Lines (Origination,

Renewal, Closure)

Local Payments

RTGS

Collections

Fast & Urgent Payments

SWIFT

Local Payments

RTGS

Fast & Urgent Payments



Spot

Front office – Treasury

Deal Input

Exchange Traded

Derivatives

OTC – Options and Derivatives

Forex

Money Market

Securities

Forward Swaps NDF Placement Borrowing

Hedge Trade Contract Buy Sell

Securities

Exchange Traded Derivatives

Futures Options Bonds Derivatives Commodity Interest Rate Currency Equity

Derivatives

Forward Rate

Agreements Interest Rate Swaps

Cross Currency

Swaps

Foreign Exchange

Fixed

Interest Bonds

Floating

Interest Bonds

T-Bills /ZCB/

Corporate Bonds Discounted

Instruments Equities Rights Warrants Banker’s

Acceptance

Repos/

Reverse Repos

Money Market



Middle office – Risk Management

Product/ Contract

Accounting Limits Advices Charges/

Brokerage Settlement Messaging MIS Reporting Tax SWIFT

Multi Currency

LIFE CYCLE

FEATURES

FRAME WORK

Book Revalue Close Reversal Matching Expiry Excercise Assign

Termination Liquidation Rollover Amendment Confirmation Extend Reassign Settlement

Deal Enrichment

Authorization Message

Generation Tax

Processing Charges Netting

Brokerage Calculation

Holiday Processing

Payment Settlement

FX, Money Market

Coupon Processing

Dividend Processing

Rights Warrants Redemption Portfolio Processing

Revaluation Costing Accrual

Processing Accounting

Securities

Cap Floor Collar Corridor Payer

Swaption Receiver Swaption

Plain Vanilla

Binary Digital No

Touch

Interest Rate Options Swaptions Currency Rate Options



Back office – Accounting and Messaging

INSTIUTIONAL DELIVERY

ACH

SWIFT

GIRO

CENTRAL BANK REPORTING

ZENGIN

CLEARSTREAM

/CEDEL

RATE FEEDS

INTERNET BANKING SUITE

PORTAL

RETAIL

CORPORATE

INVESTOR SERVICES

BROKER

3rd PARTY INTERFACES

CRM

DEALING SYSTEM

OTHER INTERFACES

Bills and collections

Deposits Loans CASA Letters of Credit

Foreign Exchange

Money Market

Dealer Investor Services

Cash Liquidity Management

Asset Management

Derivatives Securities Loan Application Processing

Loan Syndication

Signature Verification

Funds Transfer Standing

Instructions Electronic

Messaging System

Workflow Management

Nostro Reconciliation

Fixed Asset Management

Expense Processing

Risk Management

Clearing Management Information

System

Customer Information

system General Ledger

CORE MODULES

COMMON FACILITIES

FUNCTIONAL MODULE



Trade Flow



Back office – Retail Banking

Retail

Servicing

Cash Management

• Multi branch

• Multi Currency

• Multi Account

• Standing Instructions

Instrument Processing

• Cheque

• Demand Draft

• Banker’s Cheque

• Travelers Cheque

Savings Account

• Multiple Account types

• Transaction Types

• Flexible Interest calculation

• Multi Currency Payment

• Teller

• POS

• Kiosk

• ATM

• Internet

• Call Center

• Mobile

Current Account

• Overdrafts

• Escrow Processing

• Project Account

• Multi Currency

Deposits

• Term / Recurring / Auto

• Flexible Interest calculation

• Multi Currency

• Dual Currency Deposits

Mortgages

• Acquisition

• Initiation

• Servicing

• Payments and Settlements

• Tracking

• Collections

• Risk Management



Back office – Corporate Banking

Corporate

Servicing

Collections

• Incoming/ Outgoing

• Usance / Sight

• Documentary

• Clean

• Under LC

• Not under LC

Overdraft

• Risk Management

• Collaterals

• Interest Calculation

Guarantee

• Facility to issue

• Shipping Guarantee with linkage

to LC and Bills

Term Loans

• Acquisition

• Initiation

• Servicing

• Payments and Settlements

• Tracking

• Collections

• Risk Management

Cash Management

• Multi Account structure

• Pools and Sweeps

• Online Sweeps

• Multi branch

• Multi Currency

Nostro / Vostro

• Correspondent bank accounts

• Statement Generation

• Reconciliation

Letters of Credit

• Import / Export

• Revolving / Non Revolving

• Clean

• Open Ended

• Back to Back

• Standby

Financing & Hedging Services

• Pre Shipment

• Post Shipment

• Buyers credit

• Trust Receipts

• Adhoc finance

• Hedging - Bill Linkage to FX Deal



Back office – Finance and Accounts

Finance

and

Accounts

General Ledger

• Parameterized / Multi-level GL

structure

• User-definable MIS entities for

reporting

• Period accounting and reporting

• Multi-currency Profit and Loss

Reporting

• Flexible Reporting

- At Branch / RO / HO levels

- Reporting from any GL level

- MIS classification Reporting

Reporting

• Cost Centre Reports

• Ratio Analysis

• Cash Flow

• Receivables

• Payables

MIS

• Profitability

• Deposit growth

• Loan growth

• Non funded

• Business growth

• Relationship management

Budget



Channels – ATM, Internet, Telephone/IVR, Mobile



Analytics – Credit Risk, Market Risk, Operations

risk, channel

Performance

Management

Customer

Insight

Governance

& Compliance

Risk

Management

Treasury Risk

Credit Risk

Governance and Compliance Regulatory Compliance (Financial Crime)

Channel Insight

Analytical CRM

Anti-Money Laundering

Trading Compliance Broker Compliance

Fraud Detection Operational Risk

Retail Credit Risk

Corporate Credit Risk

Portfolio Analytics

Marketing Analytics

Service Analytics

Channel Usage

Channel Performance

Economic Capital

Regulatory Capital

Liquidity Risk Stress Testing

Economic Capital Advanced (Credit Risk)

Operational Risk Economic Capital

Performance Management and Finance Accounting Hub

Activity-Based Costing

Consolidation Profitability

Budgeting and Forecasting

Hedge Management IFRS 9 – IAS 32/39

ICAAP

Customer Profitability

Stress Testing

Asset Liability Management

Market Risk

Basel II

Retail Portfolio Risk Models and Pooling

Funds Transfer Pricing

Loan Loss Forecasting Pricing Management

RAPM

Balance Sheet Planning

Know Your Customer

Reconciliation



Payments – RTGS, Fast, High Value, Normal

Receive Process Release

Currency Services Accounting

Services Messaging Services

Settlement Services Holiday Processing Charge Services

Local Payments Cross-Border Funds Transfer

Payment

Initiation

Teller

ATM

Call center

Internet

Kiosk

POS

Mobile

Sw

itch

Payment

network

ACH

RTGS

SWIFT

CLS

Sw

itc

h

Customer Limits

Relationship Pricing

Accounts

General Ledger

Transaction

Reconciliation

Standing Orders

MIS

Reporting

Customer

Information File



Technical Architecture – 2 tier, 3 tier, n-tier



Business Logic and Entities

Data Access Components

Presentation Layer

Business Layer

Data Layer

Mobile Application

Data Source Application /

Services

Mobile Application Server

Data Interchange

UI Components

Flat Files/

SQLite

Se

cu

rity

Co

re

Con

figu

ration

Data Synchronization

GPRS/3G/Internet

ASCII/XML

files

Technical Architecture - Illustrative

Core Banking System

DB Server

Machine

Agent Mobile

App download



Software components

APPLICATION

FIDELITY

FNIS

TEMENOS T24

Software Product vendor

Application

INFOSYS

FINACLE

TCS

BANCS

REPORTING


OBIEE, BIP

Hyperion System

SAP

BUSINESS

OBJECTS

IBM

COGNOS

SAS

ENTERPRISE

BI

PENTAHO

BI

ENVIRONMENTAL


MS SQL

Server

My SQL Sybase

Teradata



HARDWARE

IBM

HP

DELL


CISCO

SUN

INTEL

Market Players – Hardware



HARDWARE


MS SQL

Server

My SQL

DB2 Informix

Sybase

Teradata

Market Players – Environmental



Market Players – Application

CORE BANKING SYSTEM

FIDELITY

FNIS TEMENOS

T24


Application

INFOSYS

FINACLE

FISERV

ICBS TCS

BANCS

MISYS

BANKFUSION

SAP

CORE BANKING

JACK & HENRY

SILVERLAKE

POLARIS

INTELLECT

SUITE

SOURCE:CELENT

0 200 400 600 800 1000 1200 1400 1600 1800

North America

Europe

APAC

LAMEA

CORE BANKING MARKET SIZE

2011 2010 2009



Market Players – Reporting

REPORTING


OBIEE, BIP

Hyperion System

SAP

BUSINESS

OBJECTS

NETWEAVER BI IBM

COGNOS

SAS

ENTERPRISE

BI

MICROSOFT

BI TOOLS

PENTAHO

BI

JASPERSOFT



Market Players – ATM

ATM VENDORS

NAUTILUS

HYOSUNG

NCR

TRITON DIEBOLD

WINCOR

NIXDORF



Market Players - Telephone

TELEPHONE

BANKING

FIS

SDS

Automated

Systems

FANAP

Euronet

Software

Solutions

Convergys

Rubik



Market Players - Mobile

MOBILE

FINANCIAL

SERVICES

PROVIDERS

M PESA

TRUE MONEY

SMART MONEY

GLOBE CASH MASTERCARD

VISA

GOOGLE



WHAT ARE THE BUSINESS DRIVERS

FOR SYSTEMS REPLACEMENT?



Drivers for Technology Adoption

Depreciation and Useful Life cycle of the software

Growth of Business/Market

Condition

Legacy System Replacement

(usually done after 10 to 15 years)

Existing Software Vendor Out of

Business



System selection process

Finalize Vendor

Shortlist Vendors

Conduct Initial Evaluation

Request for Information

Request for Proposal

Proposal Submission

Initial Shortlist

Proof of Concept/

Product Walkthrough

Commercial Negotiation

BID

If non of the

systems qualifies

If non of the

systems qualifies

1 system recommended

Award

Contract

Revisit to the

screening process



Point or Universal?

Niche Providers Universal Banking Solution Providers

TRADE FINANCE

SOLUTIONS

LOAN

ORIGINATION SOLUTIONS

FINANCE &

ACCOUNTING SOLUTIONS

TREASURY SOLUTIONS

MORTGAGE SOLUTIONS

TRADE FINANCE MODULE

CORE MODULE

LOS MODULE

DIRECT BANKING MODULE

EMS MODULE

LOANS MODULE



• The vendor should have a verifiable track record of:

financial stability

staff stability

customer satisfaction (contactable client references)

accurate & on-time product implementation

accurate & on-time delivery of enhancements and fixes

• The vendor must provide adequate on-site support during the analysis and implementation phases

• The vendor must provide adequate ongoing client service support in the geographical locations and/or time zones of the planned implementation

Process of Evaluating technology vendors (Cont…..)

Company Profile



• The product should support list of current and future planned products

• The system must support global processing

– Multi-currency

– Multi-entity

• The system must support strategic business initiatives

• The vendor solution must be:

– Modular

– Component-based

– Open (communications via industry standards)

• The vendor solution must comply with technology standards for hardware & software

• The vendor solution must support real-time data transfer between applications

• The vendor must have a documented process for bug reporting and fixing, system enhancements and release schedules

• The vendor solution must support the projected transaction volumes & metrics

Functionality Fit

Technological Fit

Process of Evaluating technology vendors (Cont…..)



• Initial tabulation of RFP results

• Working team review of tabulation and selection of vendors for on-site demos

• First round of on-site demos for broad product overview

• Working team review of vendors post first round demos & selection of preferred vendors for second, in-depth review

• Final recommendation

Vendor short list review process

Process of Evaluating technology vendors



RFI / RFP – Role of consultants

CONSULTANT

PROGRAM

MANAGEMENT

PROJECT

GOVERNANCE

VENDOR

EVALUATION

SCORING of

RFI/RFP SOFTWARE

Pricing Profile of Team

Domain

Knowledge

Local Market Knowledge

Track Record

Criteria for Choosing

Consultants



POC / PWT

PRODUCT

WALKTHROUGH

AGENDA/

SCHEDULE

TESTCASES

LIVEWIRES/

FRAMES

CONDUCT PWT

RESULTS/

EVALUATION

RECOMMENDATION



Components of a commercial proposal

Core Banking System

Cost

Additional Technology

Licenses Cost

Hardware Cost

Components of a

Commercial Proposal

Application License Fees

Annual Maintenance

Fees

Implementation Fees (Migration, Customization,

Training)

Others

(Onsite Support, Out of Pocket Expenditure)

Database server

, Reporting Database

Server cost

Application Server, Web

Server & Reporting

Server Cost

UAT/DEV Server and Secure

Backup Cost

Other Value Add Costs like Real

User Experience Insight Cost

Production Site Cost (Database, Application & Reporting

Servers, Webserver, Storage System, Back Up Server, Other

Value Add costs

Disaster Recovery Site Cost (Database, Application &

Reporting Servers, Webserver, Storage

System, Back Up Server, Other Value Add costs

UAT/DEV Server Cost



Model adopted by market players

Product

Licensing

• Component Licensing with user based, usage based and enterprise based licensing metric

• Custom Applications Suite

• Enterprise Licensing

Product Implementation

• Fixed Price – deliver the project on agreed cost & timelines, based on mutually agreed acceptance criteria

• Time & Material – suited for ongoing projects where there is a need to maintain a team to service the regular flow of requirements

Application Management

• Flat Rate – yearly renewal with defined SLAs

• Percentage based – based on a certain percentage of licensing fee, renewable yearly with defined SLAs

P

R

I

C

I

N

G

M

O

D

E

L

S



Project Budget - Illustrative

$293,015

$64,463

$770,750

$22,250

$121,000

$135,000

$- $400,000 $800,000

APPLICATION SOFTWARE …

SUPPORT FEE

TOTAL IMPLEMENTATION COST

TRAINING

ON-SITE SUPPORT

OUT-OF-POCKET EXPENSES

Core Banking System Cost

$259,317

$110,508

$25,417

$- $100,000 $200,000 $300,000

PRODUCTION SITE

DISASTER RECOVERY SITE

UAT/DEV SERVER

Hardware Cost

$549,549

$57,096

$- $200,000 $400,000 $600,000

MANDATORY COMPONENT(SERVERS, SECURE

BACKUP)

VALUE-ADD COMPONENTS

Technology Licenses Cost

$1,406,479 , 58%

$606,645 , 25%

$395,242 , 17%

Overall Budget for Project

Core Banking SystemCost

Technology LicensesCost

Hardware Cost



Steering Committee OC Status review Task I Mgt Comm introduction meeting Mile stone based sign offs W Workshops

Key Activities

System Installation

User Acceptance

Testing (UAT)

Go-Live

Business

Requirements System Configuration

PWT & User

Training

Application UBS installation

Environment set up for Training,

Map products, chart of accounts , static parameters etc

Mobilise Implementation vendor team and gather artefacts from Jamuna Bank

Baseline project plan and align project team (Implementation vendor & Bank)

Engage Core team in User Training

Product Walk through to Senior management

Prepare test strategy, UAT on base product, data conversion

Test cases, scripts, run charts, logical days, expected results

Regression testing etc . UAT on migrated data

Production Environment deployment & preparation

Project Initiation

Live cut-over

Post-Live &

Handover to

Software Product

vendor

Post-live Production Support

Analyze bank products & services

Interfaces & reports (if any) SIT / Unit Testing

Present findings, discuss handover & next steps

1 11 2 3 4 5 7 6 8 9 10 12 13 14

Month starting September 2013

S

S

S

S

S W W

W W

W W W W

W

W

W

Project Sign off

W

W

W

W

S

W

S

S

Project Implementation – Illustrative schedule



Pre-requisites

Contract Signing

Identification of Core team from the bank

Project Plan Review and Rework

Hardware, Software and Work Facilities

Readiness



Illustrative Implementation methodology

Migrate Test Design

STA

GE

KEY

AC

TIV

ITIE

S K

EY D

ELIV

EAB

LES

PLANNING

PRODUCT WALK THROUGH

GAP ANALYSIS

Application INSTALLATION

Project Initiation Document Product Walkthrough document

TRAINING DATABASE

PRODUCT CONFIGURATION AND STATIC SET UP

SYSTEM PARAMETERIZATION

SHELL DATABASE

UAT DATABASE

TEST STRATEGY AND PLANNING

TESTING

ACCEPTANCE AND SIGN OFF

1

Initiate

2

DEPLOY

PARALLEL RUN

HANDOVER AND SUPPORT

POST IMPLEMENTATION REVIEW

Implementation methodology is based on a phased delivery based approach leveraging best practice tools and

methodologies

Training agenda / Calendar, feedback forms Configuration templates

4

5

3 Application Installation

manual

Test Strategy Document Test Scripts

6

7

8 Defect log Reports

Migration Strategy Document Handover Report to Software Product vendor

9

10



Overview

Implementation methodology Keynotes

Application domain

This Quick Reference Guide describes Implementation vendor’s methodology for

systems implementation projects. It covers the whole project lifecycle from initiation to

deployment

The methodology is designed to be scalable and portable: it can be applied for large

programs as well as for relatively small projects

This delivery methodology has been developed keeping process and business

functions as the necessary elements to bridge the gap between the business

requirements of the bank and the package to be implemented

Implementation of core banking systems is expected to improve operational

efficiency, increase savings, improve control and enhance service in the back-

office of financial service firms

Structure and terminology

The methodology is structured along programs, projects, stages, activities, tasks and

steps

A typical project consists of 5 stages: initiation, design, test, migration and

deployment. Each stage consists of one or more activities. Activities consist of tasks.

Tasks can be split in steps. Tasks lead to well-defined deliverables

Guidance

This methodology does not impose a rigid framework on the project

team. Instead it is intended to support and provide guidance to their

sound business judgment in arranging the project work into

manageable chunks.

The methodology allows the project manager to structure the work

freely along the activities and tasks, while preserving complete

flexibility and freedom: activities, tasks and steps considered

superfluous for the project at hand can be omitted. Activities can be

re-iterated as needs occur.

This methodology is strong on sequence of activities and information

flow, but is less articulated in terms of “who does what” (i.e.

role/action perspective). This is intentional since program structure is

dictated by the client’s organization and the terms of Implementation

vendor’s assignment, which vary considerably from project to project.

Deliverables are marked mandatory (M), recommended (R) or

optional (O). Again this is merely based on industry best practice and

intended to guide the sound business judgment of the project team on

their specific project.

The one concrete objective targeted with this methodology is to

establish a common terminology amongst project stakeholders,

leading to a mutual better understanding when discussing project

deliverables, assignments, status and progress.



Profile of Implementation team from Bank

BA

NK

’s IM

PLE

MEN

TATI

ON

TEA

M BUSINESS UNIT HEAD

FINANCE TEAM

RISK MANAGEMENT TEAM

OPERATIONS TEAM

TECHNICAL TEAM

MARKETING TEAM

SYSTEM ADMINISTRATOR

REGULATORY and COMPLIANCE TEAM

QUALITY MANAGEMENT TEAM



Deliverables

Product walk thru

document (M)

Feasibility analysis (O) Requirements list

(functional & non-

functional) (M)

Use cases (diagrams &

descriptions) (M)

Walkthrough results (M)

Requirements

document sign-off (M)

Increment and delivery

plan (M)

2.1 Define objectives of

bank

2.2 Describe current

technology environment

2.3 Define budget and

staffing constraints

2.4 Define integration

requirements

2.5 Map proposed system

against objectives,

constraints,

environment &

integration

requirements

2. Feasibility study

(optional)

3.1 Define stakeholders (bank, Software Product vendor, Implementation vendor, III party vendors etc)

3.3 Organize interviews (Finance, IT, Retail, Corporate, Payments, Operations)

3.4 Discuss current product and service offerings

3.5 Gather future business requirements

3.6 Develop functional requirements

3.7 Develop non-functional requirements

3.Requirements

elicitation and

specification

5.1 Group new

requirements into

Phases based on

feature criticality

5.2 Define iterations within

each release

5.3 Produce a release

based delivery plan

5.4 Review task

deliverables

5. Plan releases

4.1 Organize requirements

walkthroughs by

stakeholder and

viewpoint: check for

validity, consistency,

completeness, realism

and verifiability.

4. Requirements

validation

1.1 Define how system will

be demonstrated

1.2 Define how traceability

from system features to

business function

mapping will be handled

1.3 Get a high level

understanding of the

bank (Vendor, Public

domains etc)

1.4 Confirm deliverables

1.5 Plan for project phase

(Estimate workload, resource,

schedule, baseline plan)

1. Planning

Product walk through

Senior Managers, BU Heads etc

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Product walkthrough

Keynotes

Key deliverable contents

Application Product walkthrough Document

Background of the bank

IT Landscape (Systems in production mode)

Details of Legacy system

Bank structure

Number of branches to be rolled out

Static parameters

Business units to be covered

Product requirements under various asset, liability and service

classes

Interface requirements

Classification of gaps (CFL, NTH etc)

Prerequisites

Sales note / work order

Interview schedule with business users

Objectives

Mapping of Application system with business requirements

Documentation of gaps

Classification of gaps

Effort required to bridge the gaps

Guidance

PWT is a critical activity as part of systems implementation.

This activity provides the bank with a first hand understanding

of the product features

From a implementation perspective it provides a first hand

understanding of whether the system can be implemented,

whether any work around is necessary

.



Application Installation

1.1 Ascertain whether bank

has procured the

necessary hardware

1.2 Ascertain server is in

the bank premises and

ready to be

commissioned

1.3 Gather information on

hardware architecture

(Model, Server sizing,

space availability, disk

partitioning etc)

1.4 Identify IT resource/ for

co-ordination

1. Planning

2.1 Ascertain operating software has been installed

2.2 Gather information on operating software installed (UNIX, Windows, version etc)

2.3 Ascertain environmental software has been installed

2.4 Gather information on Software Product vendor version installed and client software (Developer 2000)

2.Operating and

environmental software

installation

4.1 Invoke Application from

client machines

4.2 Logout and Login

4.3 Login in parallel from 20

or 30 machines

4.4 Check for performance

of the system

4. Testing

5.1 Inform IT / Project

management office of

bank on completion of

installation

5.2 Inform Software

Product vendor on

completion of

Application installation

5.3

5. Release

3.1 Install Application

3. Application installation

Deliverables

Sign off from Bank (M)

Installation Manual (M)








Application software installation

Keynotes


Application installation Document

Hardware details (Server size, configuration, partitioning etc)

Operating software installation (Windows, Unix etc)

Environmental software (Software Product vendor version,

Developer 2000 etc)

Citrix installation

Prerequisites

Operating software installed

Environment al software installed

Objectives

Application access for bank users

Get sign-off for installing Application

Guidance

Operating and environmental software installation is outside the

scope of Implementation vendor

Install the version shipped by Software Product vendor from the CD

Inform bank (PM) and Software Product vendor (PM) over email on

completion of this activity

Obtain physical sign-off from Bank project manager

.



User Training – Functional, Technical

1.1 Ascertain whether bank

has identified core team

to be trained

1.2 Ensure core team has

representation from all

departments

1.3 Identify infrastructure

requirements

(Application installation,

desktops, seating,

room, projectors, white

board, flip charts, user

manual, training ppt’s

etc)

1.4 Prepare training

calendar

1. Planning

2.1 Phase out the training program as core components and business

2.2 Use generic case study to explain the features and navigate though the system

2.3 Prepare scenarios to explain all plausible business conditions

2.4 Prepare exercises for hands on session

2.5 Obtain feedback 2.6 Review feedback 2.7 Plan for additional

training

2. Functional training

4.1 Identify users for add

on training from core

group

4.2 Identify and document

areas where add on

training is required

4.3 Conduct add on training

4.4 Obtain feed back

4.5 Review feed back

4. Additional Training

5.1 Obtain sign off from

Bank project manager

5.2 Inform Software

Product vendor project

manager on completion

of user training

5. Signoff

3.1 Modules to be covered

(Security mgmt system

– SMS, EOD

processing)

3.2 Data Back up

procedures

3.3 Data purging

procedures 3.4 Prepare exercises for

hands on session 3.5 Obtain feedback 3.6 Review feedback 3.7 Plan for additional

training

3. Technical training

Deliverables

Training calendar (M) Feed back forms (M)

Additional training

agenda (O)

Feed back forms (M)

Additional training

agenda (O)

Training agenda

Feed back forms (M

Sign off (M)








User training

Keynotes


Application training

Functional training

Technical training

Auditor training

Case studies for training

Exercises for hands on session

Prerequisites

Application training database

User manuals

Module wise training PPT’s

Identification of core group of users to be trained from the bank

Objectives

Good structural understanding of Application for core group

High degree of conceptual and functional clarity

Good grasp of technical architecture

Guidance

Training is a critical activity of product implementations. On

this hinges the success of other stages of the project.

Morning sessions have to be instructor led with PPT’s and

other training aids as necessary. Fore noon sessions to be

focused on hands on training

Training structure and orientation to be based on business

process of the bank for easy understanding

Business cases to be developed based on PWT

Obtain feedback from the users at the end of every session

Review training style and content based on feed back

Obtain physical sign-off from Bank project manager

.



Application System configuration, Parameterization

Finance, IT and Business units

1.1 Finalize interview

schedule with various

stakeholders (Finance,

IT, Audit etc)

1.2 Keep sample product

configuration document

and explain the way

product has to be

configured

1.3 Identify SPC for

various business units

1.4 Keep all upload utilities

ready for use

1.5 Identify IT resource for

co-ordination

1. Planning

2.1 Ensure representation is there from all stakeholders

2.2 Provide a full list of static data parameters to be configured

2.3 Explain the implications, pros and cons of designing the static parameters in different approaches (operational efficiency. MIS etc)

2.4 Refine static data parameters once data is obtained from all stakeholders

2. Static data definition

and configuration

4.1 Upload all static

parameters using tools

and utilities developed

4.2 All business products to

be manually configured

4.3 Identify IT resources for

upload and manual

definition of products

4.4 Keep all static

parameters and

products unauthorized

except the mandatory

tables

4.5 In parallel keep a mirror

image of FC database

4. Application Database

population

5.1 Release Application

database with

populated data to IT

and business users

5.2 Provide FC and BO

reports to ensure

accuracy of data

uploaded and manually

configured

5.3 Modify erroneous data

to reflect correct values

5.4 Post sign off authorize

all records

5. Review and Sign off

3.1 Ensure business users

and IT are represented

in every session

3.2 Explain product features

3.3 Match business users

expectations with

product features

3.4 Document gaps

3.5 Review product

parameters

3.6 Refine and enrich

product configuration

with incremental data

3.4 Iterate the process to

ensure alignment of IT

and business

3. Business products

definition and

configuration

Deliverables

Interview schedule (M)

Static and product

configuration templates

(M)

Static data

configuration templates

(M)

Sign off on static data

(M)

Product configuration

templates (M)

Sign off on product

data (M)

Application Database

with populated data (M)

Mirror image of

Application database

(M)

Obtain sign off (M)








Application system configuration

Keynotes


Static parameter templates

Product configuration templates

Prerequisites

Application shell database

Identification of owners for static, GL and product data

Objectives

First draft of Application database with data configuration as

specified by the bank

Users of system get a first hand understanding of the system

Paves the path for further stages of the project

Guidance

Time consuming activity as the bank has to vizualize exactly

their requirements

Extreme tact and patience is required from the project staff to

configure the product to suit the needs of the bank

Complex areas in general are GL structure and MIS

requirements

Upload data in Application system and allow end users to

manually configure products only after sign off is obtained in

hard copy

Always keep a mirror image of the data configured in a

unauthorized status

Obtain sign off for uploading data in Application (Provide

Application and BO reports to ensure accuracy of data)



User acceptance testing – Functional, technical –

stress, volume, connectivity

1. Prepare overall test

strategy

1.1 Define functional test

cycles

1.2 Define non-functional

test cycles

1.3 Define operational test

cycles

1.4 Define level of testing

1.5 Confirm testing tools to

be used

1.6 Define defect

management procedure

1.7 Review task

deliverables

1.8 Adjust/refine

acceptance criteria

2. Prepare detailed test

plans

2.1 Review increment

milestones

2.2 Determine test

dependencies

2.3 Determine entry criteria

per cycle

2.4 Determine exit criteria

per cycle

2.5 Determine resource

requirements

2.6 Determine test

environments

2.7 Plan each cycle

2.8 Review task

deliverables

2.9 Support preparation of

detailed test plans

5. Execute test cycle

5.1 Review entry criteria

5.2 Execute test scripts

5.3 Verify results

5.4 Log test execution

5.5 Log defects

5.6 Run test statistics

5.7 Review exit criteria

5.8 Support execution of

test cycles

5.9 Perform defect tracking

and bug fixing

3. Prepare test

scenarios

3.1 Refine business test

scenarios

3.2 Define non-functional

test scenarios

3.3 Define operational test

scenarios

3.4 Verify requirements

coverage


test scenarios

4. Prepare test cycle

execution

4.1 Prepare test scripts

4.2 Verify path coverage

4.3 Prepare initial data

4.4 Prepare script data

4.5 Prepare expected

results

4.6 Define test statistics


test cycle execution

4.8 Organize defect

tracking and bug fixing

Deliverables

Test strategy

documents (M)

Refined acceptance

criteria document (R)

Test cycle definition

document (M)

Detailed test plan per

cycle (M)

List of test scenarios

(M)

Detailed test scenarios

(M)

Test scripts (M)

Test environments (M)

Initial environment data

(M)

Defect tracking

procedure (M)

Test execution log (M)

List of defects (M)

Test cycle sign off (R)

Weekly defect tracking

reporting (M)

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User acceptance testing

Keynotes


Test strategy document – Scope of tests – Test cycles breakdown

• Sequence • Scope per cycle

– Overall test schedule • Preparation and execution start and end dates • Dependencies

– Test environments • Environment definition per cycle

– Resources • Teams involved • Roles and responsibilities

– Tools and procedures • Defect management • Control • Reporting

– Risk assessment • Major risks and mitigation plan

Test cycle definition document – Detailed scope of test cycle

• Validation areas • Test scripts linked to requirements

– Test cycle schedule – Test environments

• Detailed test environment definition – Resources

• Individual people involved • Roles and responsibilities

– Cycle entry criteria – Cycle exit criteria

Prerequisites

Solution test completed successfully. Test environments set up before starting test execution.

Objectives

Assess whether the solution matches the requirements. Perform defect tracking and bug fixing.

Guidance

Most of the tasks are under the responsibility of the Client. They are

generally performed by the Client himself. Plan for following test cycles as you see fit: functional, cross-system

integration, operational, migration, performance, volume, recovery, security, archiving, clean-up, system monitoring.

Provide test scripts for both positive and negative testing. Especially focus on boundary cases.

Plan for environment setup and dry-run periods. Plan for rework and retest periods.



Migration of Data

Legacy to Application

1. Planning / Initiation

1.1 Define boundaries of static

data conversion (CIF,

Accounts) with detailed

scope

1.2 Validate stakeholder buy-in

to the above conversion.

1.3 Plan a phased approach for

data migration

1.4 Plan for static & Financial

data migration separately

1.5 Prepare business area wise

migration strategy

1.6 Plan for month end

migration (preferable)

4. Migrate Static data

4.1 Prepare migration scripts to

load static data into

Application

4.2 Migrate data into Application

4.3 Test the scripts multiple

times for the accuracy

4.4 Perform business validation

test by inputting basic

transactions.

4.5 Reconcile 100% data

accuracy

4.6 Generate migration reports

and sign-off with

stakeholders

2. Gather data

requirements

2.1 Define data management

principles & standards from

a Business and/or

Technology perspective

2.2 Agree and sign-off on the IT

systems and business areas

in scope for migration

2.3 Define business rules and

quality requirements

2.4 Map as-is data models and

Document to-be data

models

2.5 Define processes for

cleansing and testing data

quality

3. Cleanse and test data

3.1 Map data fields from

existing legacy systems to

Application

3.2 Codify data quality rules into

usable scripts

3.3 Cleanse and test data

quality using test scripts

3.4 Agree and sign-off

“passed” data to be

migrated

3.5 Archive remaining “failed”

data for audit purposes

Deliverables

Sign-off scope definition

document

High-level data migration

plan

Data migration rules and

acceptance criteria

document

Data dictionary with legacy

to FLXECUBE field mapping

Test scripts for data quality

Data quality assessment

reports

Data migration reports

Obtain sign-off

5. Financial data Conversion

5.1 Prepare migration scripts to

load transactional data into

Application

5.2 Migrate data into Application

5.3 Test the scripts multiple

times for the accuracy

5.4 Perform business validation

test by inputting basic

transactions.

5.5 Reconcile 100% data

accuracy

5.6 Generate migration reports

and sign-off with

stakeholders

Data migration reports

Obtain sign-off

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Migration

Keynotes


Uploaded live data in Application

Migration reports for each module

Prerequisites

Data in format specified needs to be provided by the bank

Identify SPC who will sign off on converted data

Objectives

Post migration ensure balance sheet of legacy system matches with

Application

If balance sheet does not match ascertain reasons and document

the same

Guidance

Conversion of historical transactional data should be avoided

Balances outstanding as of a particular date should be migrated

Plan for conversion on a month end after running EOD in the

legacy system

Ascertain whether the migration can be carried out on a Friday

Normal Business operations might be disrupted – Plan for this event

with the bank and inform appropriate stake holders

Prepare strategy and approach for usage of legacy system

(Exceptions handling. Past client behavior etc)

Conversion account should reflect a Zero balance post migration

If any balance is outstanding ascertain the reasons for the same

There are many conditions due to which balance sheet between

legacy system and Application might not match

Primary differences arise due to Foreign exchange rates used,

Interest accrual methods, holiday treatment etc

Use data provided in templates for conversion and Migration reports

for ensuring accuracy of migration exercise

Obtain sign off on template sheets which contain data to be

migrated and on Migration reports



Live operations and parallel run

Production Environment

1. Planning

1.1 Identify Helpdesk

1.2 Identify SPCs for Ops

1.3 Define approach for

booking transactions in

legacy system

(Manual/Upload).

1.4 Educate user to book

transactions in Application

and then legacy system

1.5 Asses Critical customer

touch points

1.6 Approach for reconciliation

1.7 Agree on period for parallel

run

1.8 Plan for mass customer

communication (Mails, Web

channels)

1.9 Plan for additional staff

deployment

4. Historical Data & Archival

Policy

4.1 Plan for exceptional

situations for accessing

information in legacy system

like customer statement

2. Parallel run

2.1 Execution of daily business

transactions in Application

and then Legacy system

2.2 Reconcile no of transactions

per business area

2.3 Match the Customer

account & GL Balances

(Trial Balance, P&L balance

sheet)

2.4 Match Limit utilization

2.5 Critical areas under

observation – Funds under

clearing, Customer

statements/advices, Nostro

statements, Swift messages

2.6 Analyze the difference if any

and document reasons

2.7 Document & track the

problem over few days

2.8

3. Phase Out Legacy

System

3.1 Suggest alternative

approaches for the

unresolved issues.

3.2 Follow up for business

approval

3.3 Get feedback/sign off from

each business area for final

cut over

3.4 Post cut over observations

on central bank /HO

reporting

3.5 Define access rights for the

legacy system as per legacy

policy

Deliverables

Cut Over Approach

document

Issue tracking sheet

Sign Off templates

Reconciliation Template







Live operations and parallel run

Keynotes


Prerequisites

Help desk with named resources

Identify resource from bank who will sign off on the reports for

accuracy and stream lined operations

“Cut over Approach document “sign off

Objectives

Bank operations to run smoothly

Increase end user comfort on the Application

Ensure transition dissonance is minimal

Manage / end user expectations

Guidance

Very sensitive period as end users might have a resistance to

change

Extremely taxing time as every transaction needs to be entered in to

both the systems

Ensure priority of capturing transactions in Application over legacy

system.

Focus on resolving issues related to customer touch point s like

teller ops, advices, internet / ATM channels.

.

Helpdesk Resource Names & responsibility Area

SPCs (Bank core Team) & responsibility

Reconciliation format – Module, No of transactions, status

Customer mass Communication format & dates



Support Management – SLA Process and procedures

1. Planning

1.1 Engage in discussions with

Senior Mgmt from the bank

and Software Product

vendor towards establishing

parameters and guidelines

for smooth transition from

project to support

1.2 Process notes for handover

to be gathered from iflex

1.3 Introduction/alignment with

key resource SPOC from

iflex Global support and

align the resource with the

Bank Senior management

4. Transition to Global

Support

4.1 Project resources will

continue to remotely provide

information/support for a

short time to ensure smooth

transition and plug all

project specific knowhow

gaps

4.2 Ensure smooth and crisp

knowledge transfer from

project phase to Global

support

2. Project Handover to Global

Support

2.1 Analyze all open

incidents/defects from the Project

phase and ensure clear

documentation and status

handover to iflex

2.2 Provide iflex resource with

process documentation on

release methodology, incident

handling/resolution/escalation

etc.

2.3 Documentation/reference check

points from User Acceptance test

scenarios to be provided for

future reference

2.4 Change request pending

approval/further steps,

background/documentation to be

provided to iflex

Deliverables

Documentation/templates for

issues/incidents/defects and

Change requests

User Acceptance sign off

and test scenarios for future

reference

Project sign-off

3. Project Phase out

3.1 Formal phase out of Project

resources

2. Project Handover to iflex

support/Global Support









Handover Document

Background of the bank

IT Landscape

Application installation Document

Product Design Document

Prerequisites

Live sign off

Bank is operating in production environment for at least a week

Objectives

Implementation vendor implementation scope of work ends and

Software Product vendor to commence post-live support

Get sign-off from Software Product vendor for handover to global

support team

Guidance

Only solution specific documentation and knowledge transfer is

covered here.

.

Handover and post live support

Keynotes



Questions & Answers

Documents

IT in Banking v0 2