The first mistake in searching for a new core system - Finding the best system

By Art Gillis

Trying to find the best system is indeed a mistake. Best system according to whom? Is the best system for Citibank the best system for a de novo? Is the best system in California the best system in Maine? Don't be too quick to answer that one. The answer may be yes. Is the system with the largest number of users the best system? Every bank deserves the best fit, not the best system. And the process begins with what I call, "Know thyself."

There are 71 marketable core solutions available in the U.S. marketplace. The list consists of solutions for commercial banks, thrifts and credit unions. Some solutions operate as in-house mode only, outsource mode only, and both-ways mode. A few operate in the large banks arena only, and many operate very well for small and mid-tier banks (de novo to banks with a few billion dollars in assets). Some solutions are so good that the competitors of the solution's creator use it to drive their own business. Some solutions are not so great, but other vendors want to drive them for banks that outsource. A license to run the Hogan System is like having first draft picks on Ted Williams, should he ever come alive from his cryogenic state. Some solutions are used by thousands of banks; others are used by less than 50. Some vendors own as many as 18 core solutions; others own just one. Some solutions are locked into one hardware platform; others will run on several.

It's like the auto industry. There's a right car for everyone, and it's not the Bentley. Take the time to examine the bank and maybe a dozen of the 71. When you come up with the right FIT, then you'll know you made the right choice. In-the-lab assessments of the "best" system can be left to marketing departments, salesmen and research firms.