If Testing 75 Brands of Bank Core Systems Sounds Intimidating, Relax, I'll Show You How To Do It The Right Way

Over the years, I have developed many good tools that I use to assist banks in the selection of a new core system. The reasons I have accumulated 36 tools containing 814 criteria are two-fold. The first is I can't stand "reinventing the wheel." The second is I don't trust myself to remember everything I did during previous projects. As a result, five months after I begin an assignment, 35 bank employees and I agree on the recommended solution. One year after the go-live date, even the bank examiners agree on the bank's chosen system.For this blog I have decided to take a different approach since you have only fifteen minutes to spare. Rather than tell you all the right things that the 36 tools advise, I'll tell you all the wrong things that some bankers do that end in disasters. Here is my list of most common "don'ts."

1. Don't worry about 75 brands. I list them only as a safeguard to respond to the pharmacist, lawyer, CPA or doctor on the bank's board who read a magazine article praising Brand X and is asking the CEO why the bank didn't choose Brand X. An appropriate answer might be, "Because we are not a BofA, Chase, Citi or Wells Fargo and we eliminated Brand X in the first round of evaluations." An answer like that is far more preferable that, "Brand what?"

2. Don't spend too much time on the losers. Most of the 75 brands can be eliminated with one show-stopper. In four hours, I can lock myself and the bank's project officer in a room and eliminate 70% of the complete list of systems. The reasons are so understandable that I have yet to meet with objections. For example, there are 16 core systems that are appropriate for only the very large banks. That means they are totally inappropriate for 15,500 small banks. When we leave the room we have a list of about a dozen or so systems that deserve further scrutiny for the particular bank being studied. That list includes names my client never heard of, so it deserves careful analysis and consideration. The second cut takes days, not hours. At the end of the first two cuts we have three or four systems that will require very detailed examination because one will fit more closely than any of the others. At this point there's no going back for rediscovery. It's like returning a rental car to the lot. You don't dare back up.

3. Don't ever let internal politics drive any tech decision. Two hours after I enter a bank I can spot the different camps. The systematic approach of the evaluation process will select the right solution. Personal choices, including a consultant's, will never come up with the right choice for the institution and its customers.

4. Don't ever let a consultant tell you which system you should select. As a bank employee you have to live with the choice, and you can't make it work if you didn't like it. If you reach an impasse and can't agree on one system, fire the 35 employees or fire the consultant.

5. Don't be too skeptical of or cynical toward the sales guys. Learn to translate their answers to your questions. For example, if you describe a capability and ask them if their system can handle it, and they respond with, "Why do you want to do it that way?" that means they can't handle it the way you want it. If you hear them say "99% of the time" as an answer, that's just a euphemism for "We didn't just fall off a turnip truck." Hammer away at the answer until you get it.

6. Don't walk into a vendor presentation empty-handed. Before the process started, you should have been trained in how to be educated. The trainer should have supplied you with score cards, lists, challenges for the vendors, and concrete questions for specific answers. By now every good vendor has heard everything, so "I'll get back to you on that" means the vendor sent a newbie to your bank.

7. Don't ever walk out of a vendor presentation without some very strong feelings for or against that vendor. If you're not passionate about the selection process, you should disqualify yourself.

8. Don't ever be a team player when it comes to casting your vote for the preferred system. Be selfish. If you represent the Loan Division, you should do your utmost to make sure the team chooses the core system that includes your preference. If you lose, then only the CEO should explain to you directly why another choice was made. And if your mother ever taught you how to be sweet, put that face on, and ask the CEO to put it in writing.

9. Don't ever copy a respected peer's choice just because it is a respected peer. You should know your bank. And it takes an outsider to tell you what your bank is all about. You will be selecting a system that best fits what your bank is all about. If you define the bank wrong, you will select the wrong system. For example, some of my clients are big in the reseller business of loans. When they hear the presentation on reseller marketing, they salivate at the thought of having access to reporting such as was demonstrated. If you never resell loans, what will that do for you? You just know the respected peer chose the system for them, not for your bank.

10. Don't go partying the night before a vendor presentation. Get a good night's sleep. Go to the gym if it works for you. Eat right. Leave the family baggage at home or dump it on your spouse when you leave for work. Today you are dedicated 100% to the bank. Each vendor is going to throw two full days of details at you. Make sure you benefited from the crash course.

Here's a final don't. Don't change your core system if you can't handle these don'ts.