Blog / Dec. 5, 2019

From Start to Finish: A Timeline for Choosing and Integrating a New Core

The decision to undergo a core conversion is never taken lightly. And why should it be: it’s an intensive process that requires countless hours and numerous resources. But, when contract renewal rolls around, every bank should perform due diligence to ensure that its core platform supports its long-term objectives. We’ve compiled a comprehensive timeline, complete with questions that facilitate discussions, to help you more easily maneuver through this sometimes-overwhelming decision.

Risk vs. Reward

As vital as technology has become to banks’ ability to compete and operate profitably, the prospect of changing core processing solutions can be overwhelming, from a cost and complexity standpoint. But, industry experts agree, putting off a needed system change likely poses more risk than any risk associated with conversion.

So, whether your bank has already identified core conversion as an option when renewal rolls around, the first step is to engage your current provider in a candid conversation. If that provider doesn’t meet your minimum requirements or align with your strategy, it’s time to start evaluating others.

Indications for a core change include when your current provider:

  • Can’t meet your minimum requirements
  • Doesn’t align with your strategy
  • Isn’t changing fast enough with the times
  • Has multiple core platforms and isn’t making strategic investment in the one you’re using

A core solution is among the top three line items on a bank’s budget. When banks don’t get the service and support level that the expenditure warrants, it’s more than a red flag. It’s time to find a new system, and a new technology partner.

The Pre-Search

The search for a new core solution should begin at least two years before the current contract ends. Institutions should allocate at least one year for evaluation, due diligence and making the selection. Then, spend another year preparing for the change. This time table provides not only adequate time to evaluate the options, but also sufficient time to prepare bank staff for the transition. Allowing for this time will save unexpected surprises down the road.

Things to consider when identifying the objectives of this transition are:

  • Nice-to-haves vs. need-to-haves
  • Where you are vs. where you want to be
  • Your culture vs. the provider’s culture
  • Your customers vs. the solution’s capabilities
  • Bank objectives vs. IT objectives

Coordinate a Multi-Disciplined Search Team

Now that you know what you’re looking for on a strategic level, the next step is assembling the right team to conduct the search. It’s a business decision that cuts across all parts of the institution. In short, any department that will be affected by the system change or its ancillary products should be represented on the search team. This inclusive approach brings an additional benefit: when the chosen system is implemented, departments are more likely to embrace the change because they were represented in the selection process.

Who should you include on the core search team?

  • Head of Customer Service
  • President/CEO
  • CIO
  • CFO
  • Core Conversion Head
  • COO
  • One person from each functional area that uses the solution

To ensure a successful selection process, the search committee should have the following components: a designated leader; a standardized way of sharing individual opinions; and a clear understanding that, although they’re representing their functional areas, the ultimate goal is to find the best solution for the bank as a whole.

Conducting the Search

To help in your search, request a complete customer list—not a list of references—and ask a variety of questions, including:

  • How many pre-integrations are built out already?
  • What percentage of your platform is exposed to APIs?
  • What is your technology strategy and vision for the future of banking?
  • How many customers does each account manager support?
  • How frequently will your account manager come on-site?
  • How many tickets do you log each week, and how many are resolved the same day?
  • How do your measure the quality of your customer support?
  • What’s your average contract length?
  • What’s your process for adding an enhancement, and do you charge for that?

Implementation Process

There are two distinct parts of a core system conversion: the technical aspect and the people aspect. However, the technical aspect often receives all the attention. Getting your staff ready for and enthusiastic about the change is as important as an effective file transfer. The most successful change management strategy has three key parts: communicate about the change, find advocates and engage with the staff.

Immediately after signing the contract with your new provider, you should:

  • Notify your current provider
  • Resolve any financial liabilities (if you’re converting prior to contract expiration)
  • Put a non-disclosure agreement (NDA) in place with your new provider so that the team can get test files early in the process

Here’s what you might expect from your new provider:

  • Post-Sales Meeting: This is an in-depth meeting to set conversion dates and discuss the overall process.
  • 180-150 Days from Conversion: The initial activity begins once the technical conversion team is assembled.
  • 175-135 Days from Conversion: The technical conversion team begins to work through test files and reports.
  • 90-60 Days Prior to Conversion: Training begins on the new system; onsite operational assessments occur.
  • 30 Days Prior to Conversion: Install telecom, review test results and get ready for “go live.”
  • 1-2 Weeks Prior to Conversion: Instructor-led application training occurs on the new system.
  • Conversion Day/Two Weeks that Follow: Conversion happens over a weekend, and various teams stay onsite to assist with a smooth transition.

Want more info on Core Solutions? Check out our Definitive Guide to a Successful Core Partnership white paper to learn more about the process of cultivating this vital relationship.

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