The National Australian Bank (NAB) is undergoing a “total environment transformation” with IT, the bank’s officials told media at a recent lunch in Sydney. A central part of the initiative is a move to “infrastructure on demand”.
NAB seeks to reduce risk by moving to industry standard IT approaches, create economic value by lowering the cost of delivery and creating new revenue streams, and become more responsive to change, said NAB group executive, Gavin Slater
Part of NAB's technology transformation is building an internal cloud and changing its IT approach to “infrastructure on demand,” Slater said. “It’s really moving our organisation from where we own all the assets and we have to buy assets to have the capacity for peak periods to where we no longer own the assets ... and we only pay for our consumption.”
“Four years ago we realised that we needed to have a serious look at our infrastructure,” said NAB chief technology officer Denis McGee. Standard servers and data centres “tend to be utilised only 5 to 12 per cent,” he said. “By having multi-tenanted infrastructure on demand we can run it up to about 60 per cent and use a whole lot less power in the data centre.”
Banks have to change their approach to IT, Slater said. In the past, banks built their own systems and “set the agenda for customers,” he said. “But where we find ourselves now, customers are setting the agenda” and banks must look for ways to “empower” them so they can access banking “whenever, wherever and however,” he said.
“If you’re not looking at replacing your underlying infrastructure and your core systems, then I have a question mark because I think at some point you’re going to have to do something. The task is not going to get any easier.”
NAB had eight bespoke data networks, but partnered with Telstra to replace them with an industry-standard, multiprotocol layer service that it pays for based on consumption, Slater said. The bank had nine different voice platforms across the company and this year introduced IP-enabled voice technologies and now runs all its voice on one enterprise system, he said. The platform has enabled NAB to roll out a voice biometrics system to authenticate customers.
The bank plans to have retired about 100 legacy systems over the next quarter, said Adam Bennet, executive general manager of enterprise transformation. The 100 are “kind of the heart, lung [and] spleen of the core operating environment,” said Slater.
The bank has been working for the last three years with Oracle to “re-architect a lot of different applications ... into one core banking system,” Slater said. Also, NAB has recently moved all its enterprise systems to SAP, he said.
Through the Oracle partnership, NAB will be rolling out a “single customer view” for its bankers that shows in one place all the business a customer has with the bank, including with NAB Group member MLC, said NAB executive general manager, David Gall. NAB has done some demonstrations of the product and plans to roll it out in a phased approach, he said.
“In the past, we had been using spread sheets and files to try to construct a single customer view,” Slater said. The Oracle CRM “has significantly upgraded our capability to do that”. The move is also the “first step” in turning off Siebel, he said. “When we roll out the rest of the Oracle origination capability we will turn off the rest of Siebel.”
Among other recent developments, NAB this year upgraded its online trading platform, NAB Trade. Also, the bank partnered with Tiger Pistol to let customers open online stores on Facebook.
NAB estimates 40 per cent of its Internet banking logons are mobile and predicts that figure will soon increase to 50 per cent. NAB seeks to be “device agnostic” to serve the most customers, Gall said.
The bank has partnered with Verifone and over the last three to four weeks has rolled out technology allowing stores to accept payments on a mobile device, he said. Meanwhile, NAB is about to launch mobile capabilities for NAB Connect, its online platform for businesses. The mobile service will be a website accessible from phone browsers, eliminating compatibility issues, Gall said.
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