GonzoBankers, I learned an important lesson this week. Although it seems that simple, economically sound technology decisions made today should not affect future system choices, they very well may. Consider this scenario:
Gonzo parent firm Cornerstone Advisors is currently facilitating a system selection engagement. We have worked hard with the client to define requirements, draft the RFP, and prepare to select a solution.
As Cornerstone documented the technical infrastructure employed by the bank, it occurred to us that the uniqueness of the infrastructure warranted a discussion with vendors whose solutions were being considered to determine whether they had experience with similar infrastructures.
When the bank expressed an interest in visiting operational sites to observe the systems in use, Cornerstone contacted potential vendors to determine if they could meet the requirements to operate in the bank’s existing environment. Several vendors with top quality functional systems were eliminated because they could not demonstrate an ability to do so.
Think about this for a moment. Your bank is about to select a vendor to provide systems to operate core functions for the next five or more years. From a limited number of choices you discover several have been eliminated for purely technical reasons. What technologies could cause a vendor to be unable to definitively commit its solution to operate successfully in a particular environment? The list is almost endless, but it includes hardware, networking equipment or software, and unique printers.
Was the management team aware of the future implications when the decision was made to deploy specific technologies? I bet they were not. So when you find yourself in this position, what can you do? Here are three possibilities:
The easy way out is to accept the fact that you have limited choices and make the best of the hand you dealt yourself. However, expect this solution to leave a bitter taste in the mouth of business units that may not be using the best product.
Include in your selection process vendors that were unable to demonstrate an ability to meet your specific requirements. If one of these vendors is ultimately selected, make the vendor contractually commit to making its solution work at your bank. If you go this route, start early on your “beta site” PR campaign with the Board and make sure your flak jacket still fits.
Stare down the CIO and insist the problematic technology be eliminated so that functionality, not technology, can drive the decision. Anticipate this alternative to be expensive, risky, and very unpopular with the folks in IT.
The truth is, none of these “solutions” really solve the problem. So, let’s consider how we can reduce the chance of ever getting into this position in the first place. To do so, we need to roll back the clock to the time the decision was made to implement this particular technology:
CIO “Terry” determines the bank can save money if the new and very unique Beelzebub teller terminal device is deployed in each branch. Terry makes a convincing case that the bank’s existing devices are at the end of their useful life and due to be replaced. According to Terry, the Beelzebub will reduce branch equipment costs by 25 percent over its lifetime. The business case proves Terry’s case, and the decision is approved by the Steering Committee.
Think about the last time the IT Steering Committee approved a major technology investment. Were satisfactory answers provided to the following questions?
If you run a bank or one of the business units of a bank or financial institution, don’t let your future choices be limited without clearly understanding the impact of technology decisions. Ask to become a member of the IT Steering Committee (or whatever organization approves major technology initiatives) and make sure the right questions are asked. Today’s technology choices may limit your choices in the future.