1. finance
2. bank

25 years
of Digital
Transformation
Research Insights by
FOREWORD
25 years
of Digital
Transformation
SILVERLAKE AXIS 25 years of Digital Transformation
2 The Journey Toward a Digital Economy Transformation
6
case study
Bank Islam Brunei Darussalam
10
case study
Bank Muamalat Malaysia
14
case study
CIMB Group
20
case study
OCBC Bank
26 Staying Ahead and Breaking New Ground
Back in 1989, Silverlake was launched upon Mr Goh Peng Ooi, our
Executive Chairman and Founder’s conviction that the mathematical
Group Theory was the best approach to building core banking systems.
Today, we are a multibillion dollar organization operating in over 20
countries across Asia/Pacific and Middle East.
In celebration of our 25 years in providing core
banking software to financial institutions, we have
The way forward
partnered IDC Financial Insights to share our story in
for Silverlake Axis
this booklet. I want to take this opportunity to thank all
is to expand from
our customers, partners and ‘Silverlakers’ for their trust
Core Banking to
and support throughout this journey.
Digital Economy
The way forward for Silverlake Axis is to expand
Transformation
from Core Banking to Digital Economy Transformation
Partnerships.
Partnerships. We have ventured beyond our strength in
Core Banking and we now deliver collaborative Digital
Economy offerings that cut across the banking, insurance, payment,
retail and logistics industries.
To all our esteemed customers, we look forward to our continued
partnership over the next 25 years.
To our potential customers, we look forward to starting our next
25 year journey with you.
Dr Raymond Kwong
CEO and Group Managing Director
Silverlake Axis Limited
1
1989
1999
Silverlake axis
The Journey Toward a
Digital Economy Transformation
25 years
of Digital
Transformation
Discovering New
Capabilities
Unlimited
Opportunities for
Innovation
Over its 25-year journey, Silverlake Axis has
built an impeccable track record of successful
core banking implementations. Founded in
1989, Silverlake Axis has delivered operational
excellence and enabled business transformations
at over 100 organizations across Asia, including
40% of the largest banks in Southeast Asia.
Over these last several years, the Group has
ventured beyond its core banking strength, rapidly
2000
2009
Unlocking New
Opportunities
Conquering New
Shores
Milestones
Through
1989,
the Last Since
Silverlake Axis
Decade
has provided
expanding aggressively through acquisitions and
partnerships to reinvent capabilities and broaden
its horizon into new industries and markets.
Recent acquisitions include Merimen Group, a
cloud-based software as a service (SaaS) platform
for insurance companies, and Cyber Village which
offers converged self-service banking solutions
across Web and mobile platforms. Both transactions
were made in quick succession in mid-2013.
In December 2014, Silverlake Axis acquired
2010
2014
Quantum
Transformation
Solutions that
Power the Digital
Economy
Finzsoft Solutions, an Auckland-based financial
technology company which develops and
implements core and vertical specific solutions for
banks and financial institutions. Finzsoft Solutions
serves to further expand its geographic reach into
the Australian and New Zealand markets.
Such value-accretive investments further
strengthen the Group as a leading provider of
digital economy solutions and services to major
organizations within the banking, insurance,
payment, retail and logistics industries.
2
3
core banking
software
enabling
key financial
institutions
across the
region to grow
and transform.
25 years
of Digital
Transformation
Silverlake Axis’ Journey
2014
• Acquired Finzsoft Solution Limited (A provider of solutions for
banks & financial institutions in New Zealand & Australia)
• Acquired Merimen Group (Insurance Claims & Policies Processing
Software as a Service Platform)
• Acquired Cyber Village Sdn Bhd (Mobile & Internet Solution)
2013
2012
• Disposal of Silverlake Axis (Beijing) Co. Ltd.
• Entered Africa Market
• Transferred from Catalist to the SGX Mainboard
• Acquired IIPL (Enterprise Payment & Integration Platform)
2011
2010
• Acquired Structured Group (Structured Software Maintenance & Project Services)
• Acquired QR Group (Retail & Logistic Solution)
• Transition to Catalist sponsored-supervised regime
• Acquired remaining 75% stake in Silverlake Japan (formerly known as SBI Card Processing Co. Ltd.)
2009
2008
• Signed technology partnership
with Zafin Labs
2007
2006
• Appointed as Microsoft Gold Certified Partner
• Invested in Unisoft/Global InfoTech, China
• Expanded licensing of SIBS into Capital Markets Industry
• Expanded licensing of SIBS into Shared Services Outsourcing Business
• Acquired Silverlake’s Banking Software Business
• Entered Japan Market
• Invested in SBI Card Processing Co. Ltd., Japan
• Entered Middle-East Market
2005
2004
2003
• Established Beijing office
• Listed on the SGX Sesdaq
• Entered China market
• Entered Sri Lanka market
2002
2001
2000
• Expanded into rest of Asia and into Middle East
1999
•Regional operations span Southeast Asia:
Malaysia, Singapore, Thailand, Indonesia, Vietnam
1998
1997
1996
• 16 banking clients in short span of 7 years
1990-1995
1989
• Founded in Malaysia by Mr Goh Peng Ooi
4
Silverlake Axis’ Digital Economy
Capabilities
Banking Solutions
Silverlake Axis’ Digital Economy Transformation
is driven by the Silverlake Collaborative Capability
and Intelligence Model (SCCIM). Solutions are
configurable to meet a set of business objectives
and empower transformation and business agility.
The Group’s SCCIM technologies enable the
financial, business, and social relationships for
today’s digital world, delivering these through the
four core pillars centering round Collaborative
Computing, Mobility, Intelligence and Cloud.
Silverlake Axis has an expanded portfolio of
solutions covering all aspects of the financial
subsector. Silverlake Axis’ banking solutions include:
• Collaborative Computing
Silverlake Axis Collaborative
Architecture provides for
seamless collaboration
between its suite of banking,
insurance, payment, retail
technologies, and to every
component of contemporary
technologies, connecting
agnostically across new
and existing platforms and
applications.
•Cyber Village Converged Internet and Mobile
Platform.
• Mobility
Technologies from the
Group facilitates customers’
mobility strategies by
providing mobility through
devices, experience and
context. This converged
Internet mobile platform
from Cyber Village
offers transformational
features across key
industry sectors to help
organizations manage the
digital experience for their
customers. Its omni-channel
real-time synchronization
across Web and mobile
enables operational agility,
increases customer
convenience, and thereby
engages them across their
ecosystem from acquisition,
to upsell and retention.
• Intelligence
Silverlake Axis’ business
intelligence technologies
are driven by its strength in
the single view of customer
information (CIF) capability
across geographies and
channels, allowing for
consistent and real-time
synchronized experience
and information flow. With
the advent of the digital
economy, these customercentric engagements further
incorporate unstructured
data from social media,
intelligent sensors and
other customer interactions
information.
• Software as a Service
In tandem with demands
for more dynamic and
cost-effective technology
architectures, Silverlake
Axis built and acquired
technologies to provide
shared resources, software,
and information to
organizations on demand
through a pay-as-you-go,
utility-style model. The
Group offers such delivery of
hosted services (Software as
a Service) over the Internet
for the motor insurance
industry though Merimen’s
eClaims and ePolicy
engines.
•Silverlake Axis Integrated Banking Solution (SIBS)
•Silverlake Axis Integrated Islamic Banking
Solution (SIIBS)
•Silverlake Axis Cards System (SCS)
•Silverlake Axis Enterprise Payment Platform, and
These platforms provide high-performance banking
and digital innovation straddling core applications
and integration, enterprise-to-enterprise
collaborations, and omni-channel services.
The Group continues to expand its range of solutions
beyond the financial sector to meet the needs
of major organizations in the retail and logistics
industries.
Ecosystem of Partnerships
Over 40% of the largest banks in Southeast Asia
currently run on SIBS with it being the core system
platform partner of choice for 3 of the 5 largest
ASEAN super-regional financial institutions. It
also has a pristine 100% success rate for project
implementations of over 100 core banking, payment
and retail solution migrations in Asia and Middle
East, and is compliant with 20 countries’ banking
ecosystem which includes e-government, financial
exchanges, and payment gateways. With its
extension into the insurance, retail and logistics
arena, the Silverlake Axis ecosystem will also
expand to ensure it brings critical business expertise
and resources to meet the needs of its customers.
5
Silverlake Axis’
banking partnerships
with Bank Islam
Brunei Darussalam
in Brunei, Bank
Muamalat and CIMB
in Malaysia, and
OCBC in Singapore.
I D C Case Study
25 years
of Digital
Transformation
On the Mobility Track
Bank Islam Brunei Darussalam
BY THOMAS ZINK
While mobile banking has become a
standard for most banks in the region, most
banks still struggle to move beyond plain vanilla
transactional services and, more importantly,
with its monetization. Today, there is a clear shift
toward adding new forms of mobile payments and
a mobile commerce capability to embed loyalty
and rewards management.
The biggest potential for mobility in financial
services lies in the convergence of big data and
mobility resulting in a personalized, contextual, and
real-time interaction with the customer. Clearly, this
will have the most impact on marketing and loyalty
management, but it will also benefit merchant
acquisition, transaction banking, and customer
service. While some banks have made impressive
progress in this regard, the industry still stands only
at the beginning of this journey and IDC Financial
Insights expects considerable investment, as well as
solid returns, in the next five years.
In this case study, IDC Financial Insights
looks at the implementation of Silverlake’s Digital
Economy Model Suite (SDEMS) as well as its
Mobility Lifestyle Ecosystem Backbone (MLEB) in
Bank Islam Brunei Darussalam (BIBD). SDEMS is
a customer platform that allows a bank to deliver
all business services to its customers across all
channels in a consistent manner. It also delivers
sales and service support capabilities to customerfacing staff and delivers a consistent channel
experience across both self-service and manned
channels.
6
7
Solution
Snapshot
Organization
Bank Brunei Darussalam
Operational Challenges
Driving customer centricity and
operational excellence by upgrading
core systems in order to empower digital
channels to cater changing customer needs,
compliance requirements and improve cost
efficiency and competitive positioning.
Solution
Implementation of Silverlake’s Digital
Economy Model Suite (SDEMS) as well as
its Mobility Lifestyle Ecosystem Backbone
(MLEB).
Project Duration
20 months
Benefit
With a target market for digital banking
services estimated at 45,000 payroll
customers, the app was downloaded more
than 36,000 times in 2013. The mobile
application has unlocked new revenue
sources for the bank, adding mobile topups and merchant discount fees as well as
increasing utilization of credit and debit
cards through a better positioning of its
reward and loyalty program.
25 years
of Digital
Transformation
SITUATION OVERVIEW
The transformation program, which BIBD launched
in 2011 in partnership with the Silverlake group, set
the bank on the journey toward customer centricity
and operational excellence. The bank invested in
a large-scale program to upgrade core systems
enhancing product sets and processes, improving
technology infrastructure focusing on getting
business intelligence right, and boosting IT security
and business continuity.
A core section of BIBD’s Transformation
Program (see Figure 1) lies in its Mobility and Digital
Economy Engagement Program with the main
objective to bring digital services to its customers,
making it the first bank in the country to provide
comprehensive banking services on mobile devices
(smartphones and tablets).
The bank sought to address challenges and
leverage opportunities driven by changing market
forces such as customer needs, compliance
requirements, and the need for higher cost
efficiency, business consolidations, and competition.
Solution Overview
While Silverlake’s forte lies in its core banking
proposition, SDEMS (see Figure 2) and MLEB were
functionally separated from the core platform
to ensure that business capabilities driving the
customer experience are flexible and can be aligned
across all users and channels.
This setup provides customers with a
consistent “look and feel” across all digital and even
nondigital channels, while giving the bank flexibility
in the back office facilitating security governance,
platform administration, and introducing a “build
once, deploy everywhere” concept for business
services. This customer experience is what sets
BIBD apart from the typically fragmented frontline
experience of the competition.
The mobile application was soon enriched with
enhanced rewards redemption for bill payments and
top-ups, allowing customers to use reward points for
instant redemption or making payments with reward
points at merchants.
The bank also launched a digitized merchant
acquiring platform for mobile payments at retail
outlets and introduced state-of-the-art ecommerce
and mcommerce features to optimize functional
possibilities of mobile banking. The latter allow
customers to pay at selected merchant online stores
directly from their bank accounts or with reward
points via quick response (QR) codes on BIBD Online.
Merchants are also provided with a marketleading cash management feature that allows them
to monitor online transactions via online banking
from the time a transaction is authorized until
transactions are settled.
Finally, a mobile advertising platform using
interactive content and the push (marketing)
messaging capabilities put BIBD into a strong
position to engage its customers. It helps the bank
to reach out to the relevant target market with
interactive content, promote new products and
services, and educate customers in an easy way.
BIBD’s mobile application took the small Brunei
market by storm. With a target market for digital
banking services estimated at 45,000 payroll
customers, the app was downloaded more
than 36,000 times in 2013. Given BIBD’s strong
position as the country’s largest bank, there is still
considerable upside potential within its existing
customer base and beyond. Its new customercentric strategy has set BIBD apart from its Islamic
competitors and puts it into an excellent position to
further expand its market dominance.
The mobile application has unlocked new
Deployment of BIBD Mobility and Digital Economy Engagement Program
April
2012
OCTOBER
2012
January
2013
November
2013
December
2013
Project Kick-off
BIBD Mobile
Banking
Application
Digital Merchant
Platform
Enhanced Reward
Redemption
Mobile Advertising
Platform
Enable payment at
merchant outlets via
mobile devices
For bill payments
and top-up services
With interactive
content and push
messaging
Silverlake Digital Economy Model Suite
Silverlake Customer Platform
USERS
Devices
Presentation
PC
Integration
Socket Services
(HTTP)
Tablet
Kiosk
Customers
Call Center PC
Web Services
(XML)
Smartphone
Strip/EMV
Chip Reader
Employees
Content Streaming
ATM/CDM
Passbook
MLEB*
QR/Bar Code
Reader
External
Messaging
Gateways
(SMS, email)
Merchant POS
Silverlake Card System
Sales &
Services
Aggregation
Product Application
Customer Holdings
Credit Approval
Customer CRM
Loyalty & Rewards
Execute Campaign
Product Pricing
Browser
Phone
FUTURE OUTLOOK
Figure 1
8
Figure 2
IVR
RFID
HSM
Card Embossing
Card Activation
Profile Info/Balance
Card Distribution
Reload
Transaction
Drill-down
Card Management
Cross-sell/Up-sell
Dashboard
Acquiring
Channel Services
Statements
Application
Account Creation
Products &
Transactions
Risk
Management
Terminal Creation
Clearing/
Settlement
Cards
Unit Management
Mobile Wallets
Credit Policy
Reload Services
Sales Compliance
Fulfillment
Trust Account
Transaction
Exceptions
< External >
Messaging
Card
Personalisation
Collections
Help/FAQ
Partners
Generic Search
Issuing
Authorization
Fraud Detection
AMLA
Common application Services
Application
Processing
Transaction
Management
Credit Payment
Exception/Dispute
& Chargeback
Blacklists
Payment
Regulatory Reports
Syndication
Other Protocols (e.g. Mobile SMS)
Merchant Management
GL Entries/Accounts
Management
Identity – various Authentication Methods and Access Directory Management
Suspension
MIS Management
Payment Gateways
* Please refer to Technology White Paper (Rev. 4): A Universal Mobility Enabler for Mobile Internet Commerce, October 2013
revenue sources for the bank, adding mobile
top-ups and merchant discount fees as well as
increasing utilization of credit and debit cards
through a better positioning of its reward and
loyalty program. Moreover, it comes with intangible
benefits of lower operational costs, for instance, by
offloading transactions from the branch to low-cost
channels and higher customer satisfaction, which
eventually may benefit the acquisition and retention
of customers.
CONCLUSION
many. BIBD’s approach to build a consistent channel
experience across both digital and traditional
channels will largely benefit the customer
experience and help the bank to manage its
operations more efficiently by allowing it to flexibly
adapt to change and implement new products.
IDC Financial Insights expects that more
banks will move toward an orchestrated channels
strategy, playing into the specific strengths of
each channel while allowing customers to define
their experience according to their individual
preferences.
Mobile is moving to the core of channel distribution
of banks, yet it remains only one channel out of
9
This Silverlake Axissponsored IDC case study
(IDC #FI020822V) was first
published in February 2014
and republished here with
permission.
I D C Case Study
25 years
of Digital
Transformation
Leaping into a Bold New Phase
Bank Muamalat Malaysia
by Michael Yeo
Bank Muamalat Malaysia, headquartered out of
Kuala Lumpur, Malaysia, is a fully fledged Islamic
financial institution providing Shariah compliant
services and products. Founded by an amalgamation of Islamic banking assets from three legacy
institutions in 1999, the bank was the second
full Islamic bank to be incorporated in Malaysia.
DRB-HICOM of Malaysia is the current majority
shareholder, with Khazanah Nasional Berhad also
holding significant interests. The bank currently
has over 60 branches and 250 ATMs spread across
Malaysia. Assets at year-end March 2014 stood at
approximately US$5.5 billion.
Bank Muamalat operates under dynamic
market conditions, against a backdrop of strong
domestic and global demand for Islamic banking
products. Being one of the smaller banks in
Malaysia and serving specific demographics in its
customer base, the bank’s proposition to its existing
customers has had to remain somewhat distinct
to that of the largest banks. The bank’s Islamic
foundations give rise to perceptions of a trustworthy
and socially conscious financial partner which
serves its customers with diligence and fairness in
its proceedings.
New market opportunities abound as
customer-banking requirements have evolved.
Over the last few years, the bank has continuously
adapted to meet new customer expectations. Today,
its branch-based services have given way to a multichannel approach, with an eye on delivering an
“omni-channel experience” of consistent customer
experience across the telephone, ATM and online/
mobile channels. These customer requirements,
coupled with the ever-evolving industry regulations,
dictated the need for a new core banking
infrastructure. Thus began the process of searching
for the correct technology solution and partner who
could support them in their next phase of growth.
10
11
Solution
Snapshot
Organization
Bank Muamalat Malaysia Berhad
Operational Challenges
Total replacement of an ageing core banking
system that could no longer meet both
external and customer requirements – while
still maintaining Shariah compliancy.
Solution
To develop and integrate a new Shariah
compliant modern and future-ready core
banking system via a ‘big bang’ approach.
Project Duration
18 months
Benefit
Master customer information file (MCIF)
in place, quicker turnaround times, reduced
time to market for products and reduction
in errors and risk for the bank. Increased
competitive standing in the Malaysian
banking market.
The Challenge
Bank Muamalat’s existing infrastructure before the
core banking infrastructure refresh was somewhat
unique. Being a product of historical mergers of
other banks meant that its mainframe core was
parked next to that of another bank. This sharing
of physical space presented an issue. While still
operating on separate systems and although there
was no sharing or intermingling of data between
the banks, this situation no longer met with Bank
Negara’s security and risk requirements. It became
imperative that a new core banking system was
needed to meet regulatory compliance and for new
business growth.
25 years
of Digital
Transformation
The previous solution was also complex in
its nature, having been constructed in a somewhat
piecemeal fashion over the years. In total, there
were 15 systems (mostly payments systems and
related applications) which were used to run key
functionalities within the bank and fed into one
general ledger component (GL). The streamlining
and modernization of the GL module was thus
identified as another critical and prioritized
component of the long overdue core banking
system update.
The Solution
Local knowledge of
conventional regulatory
requirements from Bank
Negara, and from the
requirements set out by
the Malaysian Shariah
Advisory Council was
deemed key to Silverlake
Axis’ success.
At the operational level, change was
also much sought after. Staff at all levels of
the organization who were exposed to the enduser interface found that the infrastructure was
inadequate. User experience was deemed lacking
and its overall ability to quickly configure new or
existing products was deemed to be insufficient
for the growth that the bank was looking for. At
the heart of the issue was the lack of a master
customer information file (MCIF), enabling staff to
quickly identify and prioritize customer information.
Data regarding the customer was still being kept in
separate file formats and systems which required
multiple support skills sets interfering with the
creation of the much needed MCIF.
12
Bank Muamalat’s management took the decision to
explore a total system refresh for their core banking
system and sought the help of capable vendors. Over
30 global vendors responded to their request for this
“rip and replace” effort. Silverlake Axis was chosen
as the eventual partner due to their prior experience
in the Malaysian market as well as their standing in
dealing with the product differences and terminology
present in Islamic financial institutions. Silverlake
Axis’ record of successful implementations with no
major disturbances also stood strongly in their favor
as well as their history of providing comprehensive
on-site support during post implementation phases.
Local knowledge in this instance was deemed key
to Silverlake Axis’ success. Local knowledge both
of conventional regulatory requirements from Bank
Negara, and from the requirements set out by the
Malaysian Shariah Advisory Council on Islamic
finance related matters.
Silverlake Axis’ solution was dubbed the
“Muamalat Banking Solution” with the Silverlake
Axis Integrated Islamic Banking Solution (SIIBS)
being chosen as the core banking framework
which would drive the transformation of the bank
while still adhering to Shariah guidelines. SIIBS is
built and optimized on the IBM i operating system
(previously known as AS/400) – a tried and tested
architecture already in use in multiple major
financial institutions globally.
The solution required 18 months of work,
spanning from 2013 to 2014. Silverlake Axis,
together with Muamalat, decided to implement
with a “big bang” approach. All key systems and
applications were to be replaced in one phase
rather than the multi-phase approach selected by
other institutions. Bank Muamalat’s smaller size
meant that the big bang approach was optimal in
reducing disruption and effort involved in the switch
over. A phased approach where relevant modules
are turned on in sequence over a designated
period of time would have added unnecessary
complexity and effort to this operation. Silverlake
Axis’ previous experience with such similar
implementations also added confidence that this
method could be used to effectively bring systems
online as quickly as possible.
Work began in 2013, and one of the major
issues to be first tackled were the multiple customer
information files being used to track and record
relevant customer information. The bank’s previous
state included a number of different systems in use
for differing business units. Customer information
regarding deposits, hire purchases and financing
was kept in silos across different business units
and in seven different systems. Data across banks
was extracted and cleansed from various data
silos and migrated to a single consistent data
file for all customers. Inconsistencies in data
were filtered out to leave a data resource which
would enable a bankwide consistent view into the
relationship that the bank has with that customer.
Opportunities for cross selling of products as well
as groupwide visibility of customer account risk are
now possible. This places the bank in a stronger
position to capitalize on growth opportunities across
its channels as well as to more clearly act upon
perceived risks and to holistically mitigate them.
The diversity of systems running in the
background proved to be a major challenge as
they were all fed into one common general ledger
(GL). This myriad of systems and applications
required separate teams with different skill sets
for operations and maintenance. Over time, this
situation had started to become a major barrier
to integration at all levels in the bank. Costs for
maintaining such a broad range of technology had
also become unattractive. Silverlake Axis Integrated
Islamic Banking Solution (SIIBS) simplified these
workflows and replaced legacy systems with the
relevant integrated modules of their own solution.
These efforts served to streamline overall system
complexity and the associated possibilities of
failures at the multiple interaction points in the
infrastructure. At the same time, this new robust
architecture also goes much further in reducing the
support effort and costs which were required in the
previous state.
The Result
The system switchover from old to new took
place in June 2014 after 18 months of work, nine
separate data migration trial runs and four rounds
of operational readiness tests which tested every
facet of the switch on process. The “big bang”
activation approach went on to proceed smoothly
and seamlessly with no major glitches or errors
encountered. Bank Muamalat, with their new
banking business engine, is beginning to see the
benefits of their investment. Turnaround times
for day-to-day business have improved and new
products are brought to market at a faster pace than
before. Existing products and services, which need
changes to parameters, can now be reconfigured
and sent back to market more quickly. Senior
management at Bank Muamalat now speaks of
clearly seen reductions in data
errors and loss of data – likely
a result of the simplified and
Senior management
integrated architecture that is now
at Bank Muamalat
in place. Bank Negara’s regulatory
now speaks of clearly
requirements as well as Shariah
compliancy are now fully met.
seen reductions in data
In addition, future changes to
errors and loss of data
regulation from both bodies are
– likely a result of the
able to be quickly implemented.
simplified and integrated
While updating the bank
architecture that is now
to meet current demands was
in place. Bank Negara’s
the primary concern, SIIBS
also takes into account future
regulatory requirements
needs and is able to integrate
as well as Shariah
seamlessly with new modules for
compliancy are now fully
newer technologies which may
met. In addition, future
arise. Bank Muamalat already
changes to regulation
has in place dual modules for
from both bodies are
both consumer and corporate
online banking and will be looking
able to be quickly
forward to implementing a
implemented.
mobile banking application in the
near future. While the bank already has business
intelligence and analytics capability in-house,
they are also looking in the future to expand on
this capability (now made easier with MCIF firmly
in place). The SIIBS is able to adapt to these new
business demands via its modular approach and
integrate them cleanly and efficiently into the
new core. New technologies as they emerge,
should theoretically pose no major issue for future
assimilation.
Most importantly, the new core has seen the
bank take important steps towards its ultimate aim
of increasing customer satisfaction and experience
and in using these pillars to increase its market
share. In a hyper-competitive domestic and regional
banking environment, institutions of all sizes must
be innovative and seek new growth opportunities
This Silverlake Axiswhere others may not yet have explored. For
sponsored IDC case study
Muamalat, their new core has given them the
(IDC #AP7919017X) was first
published in February 2015
leverage with which to meet new business demands
and republished here with
head on and find their place in the market.
permission.
13
I D C Case Study
Innovating on a Super-Regional Platform
25 years
of Digital
Transformation
CIMB Group
by Sui-Jon Ho and Michael Araneta
Malaysia’s CIMB Group Holdings Berhad (CIMB
Group) presently has one of the most farreaching super-regional operations in Southeast
Asia, with a presence in nine of the 10 member
nations of the Association of Southeast Asian
Nations (ASEAN). CIMB provides a universal suite
of financial products extending across retail,
commercial, investment and Islamic banking,
while maintaining a strong market leadership in
the latter two segments. Through the decade,
the bank has undertaken a series of aggressive
expansions, through both well-timed acquisitions
and strategic partnerships.
CIMB’s regionalization initiative has seen
success, with the bank having clocked in significant
loan and deposit growth from key holdings outside
Malaysia. In Singapore, CIMB’s loans and deposits
registered a 40% and 22% year-on-year growth for
2013 over 2012, while Thailand saw a year-on-year
growth of 12.2% and 8.1% respectively for the
same period.
As of 2014, CIMB Group had total assets
of MYR391.6 billion (US$121 billion). The Group
has been publicly listed on the Bursa Malaysia
main market for 27 years, and its current board
of principal shareholders comprises Khazanah
Nasional with a 30.1% stake, the Employees
Provident Fund (EPF) with 15.9% and Mitsubishi
UFH Financial Group with 5.0%.
The Challenge
It is somewhat easy to credit CIMB Group’s
remarkably steep growth trajectory to the
opportune mergers and acquisition deals and
partnerships outside of Malaysia. However, what
is often overlooked is how new operations have
been successfully integrated into the bank’s
core business, allowing it to take advantage of
efficiencies and economies of scale.
CIMB Group’s regional strategy is also unique
in another way: while many of its peers have focused
on channel expansions and regional outreach alone,
14
15
Solution
Snapshot
Organization
CIMB Group Holdings Berhad
Operational Challenges
Staying ahead of fast-changing customer needs
and expectations by extending banking services
and solutions beyond conventional delivery
channels and into new geographical markets;
ensuring risk management and compliance.
Solution
Implementation of Silverlake Axis Integrated
Banking Solution.
Budget
MYR1.1 billion (US$307 million)
Project Duration
20 months
Benefit
Launched its commoditized and more
sophisticated financial products with
minimal backend disruptions; projected
cumulative benefits valued at a total of
MYR1.5 billion (US$418 million) over the
course of 10 years from going live.
the bank embarked simultaneously on technology
integration projects as part of its overarching
growth strategy. In this manner, more efficiencies
and economies of scale could be obtained. New
efficiencies and synergies aside, IT innovation
played a particularly vital role in allowing the bank
to capitalize on its myriad expansions quickly, by
integrating once-independent entities into a single,
coherent business operation.
Like many banks over the last decade, CIMB
Group was presented with manifold opportunities
and confronted with challenges brought on by not
25 years
of Digital
Transformation
just the near-implosion of the financial industry
during the global financial crisis, but on needing to
tackle the growth of demand within the consumer
markets. On the latter, the bank saw a change
in customer behavior and preferences with them
becoming much more mobile as they regionalize,
with financial demands that extend beyond
conventional channels and geographies. This
brought upon added stress to its technology office
with its core banking system hardly adapting to the
fragmenting business requirements of the bank
and customers alike, let alone new drivers of risk
management and compliance, emergence of new
channel touch-points, and requirements for less
commoditized, albeit more personalized products.
Bangkok, Thailand: The 1Platform system was first implemented at CIMB
Thailand and CIMB Singapore.The Group’s relatively small business footprint
in these countries meant that both were ideal candidates for a pilot.
16
The Solution
CIMB Group’s technology-centric approach to
business optimization has persisted since its last
major restructuring exercise in 2006, from which
the group’s full-fledged financial service practice
was conceived. Even the earliest initiatives by the
Group Information and Operations Division (GIOD)
were suitably ambitious for its time. Unlike many of
its peers which typically adopt short-term horizon
planning, most of CIMB’s projects were initiated with
a medium- to long-term focus, trading immediate
benefits for business sustainability through
innovation. While most programs-of-work in the
initial three years revolved around calibration of data
management, collection and archival systems, these
served only as the foundation for more complicated,
region-wide projects to come.
January 2009 was a turning point, as CIMB
saw the finalization of a long-deliberated core
banking strategy for the Group. At that time, IT and
business decision makers agreed that the bank
ultimately needed to have a centralized, robust
manufacturing engine capable of delivering a
standardized level of service and experience to all its
customers, regardless of market and geography.
It was quite easy to perceive that the
1Platform core banking system (as it was boldly
envisioned from the beginning) would prove
to be the centerpiece of CIMB’s technological
endeavors for the subsequent five years. MYR1.1
billion (US$307 million) was budgeted solely for
the 1Platform initiative, accounting for 52% of the
amount allocated to the Group’s entire regional
transformation blueprint spanning 2010 to 2015.
The bank quickly developed plans of action,
with resources (both internal and external) made
ready. Despite the characteristic aversion of
banks in general to highly disruptive projects
(core banking projects are most disruptive, and
CIMB’s context at that time also included economic
uncertainties brought about by the global financial
crisis), the bank’s technology leaders persisted.
They were to some extent motivated by the
acquisition for CIMB Thailand and the merger of
PT Bank Lippo and PT Bank Niaga of Indonesia to
create CIMB Niaga, which was already the sixthlargest bank by assets in its country upon inception
(and currently the fifth).
It was unsurprising that CIMB Group
commissioned a vendor whose geographic coverage
and competency aligned with its own. Silverlake
Axis, which already had a tried-and-tested,
regionally viable solution, was contracted for this
purpose. To comply with the bank’s definitions
of a regional operating model, the bank and its
vendor partner decided in 2010 on the creation
of a customized core banking solution that was
based on the Silverlake Axis Integrated Banking
Solution (SIBS), but substantially redesigned to
accommodate CIMB Group’s specific requirements
as a burgeoning super-regional player.
In terms of both implementation and
usage, the 1Platform system consisted of two
main components:
•A regional core: Built upon an enhanced
SIBS (Version 10) framework, this central
system was co-developed alongside CIMB
in order to directly meet specific operational
requirements for individual countries. As
its namesake implies, the regional core is
maintained centrally as the “single version
of truth.” All critical software developments
and updates are first deployed at this level;
the binary files are then distributed to each
country for implementation, according
to master data management (MDM)
conventions.
•A localized core: This alludes to the creation
of localized capabilities for each country
that CIMB Group is present in. Support for
local interfaces, as well as provisions for
compliance with domestic technology and
reporting regulations are all accounted
for in these in-country business rules.
Technology-wise, such rules are explicitly
maintained outside of the regional core by
utilizing SIBS “user hooks” that essentially
serves as entry- and exit-points for deeper
customization. The demarcation between
localization source codes and the regionallevel code libraries occurs on both a virtual
and physical basis; when local binary files
are to be deployed, they are initially hosted
on testing/production boxes, isolated within
the database layer.
Given its scope, the 1Platform system
was implemented in phases, by each country in
succession. CIMB Thailand and CIMB Singapore
were first to undergo this overhaul. The Group’s
relatively small business footprint in these countries
meant that both were ideal candidates for a pilot,
such that any risk, be it in operations, service
disruptions, or in the integrity of the system itself,
could be contained and managed through the
resources of the region-wide enterprise.
It was also vital that the first deployments
set key project management precedents, as well
as validated them, such that they could be applied
to subsequent rollouts. In Q2 2010, the bank first
instituted a 90-day pre-implementation phase to
evaluate its country-agnostic Project Management
Office (PMO) framework, formalize both local and
ASEAN-wide target operating models alongside
their respective support architectures, and to
collaborate with Silverlake Axis to
perform critical high-level system
gap analyses.
CIMB Group began its
Despite the characteristic
1Platform migration in force by
aversion of banks
August 2010. CIMB Singapore
in general to highly
successfully made its transition
disruptive projects,
onto a simplified iteration of the
CIMB’s technology leaders
core banking system in November
persisted. They were to
2011 on an accelerated timeline
due to regulatory guidelines
some extent motivated by
by the Monetary Authority of
the acquisition for CIMB
Singapore. CIMB Thailand’s new
Thailand and the merger of
core banking system became
PT Bank Lippo and
fully operational four months
PT Bank Niaga of Indonesia
thereafter, and the bank followed
to create CIMB Niaga, which
up on these successes with
the most significant rollout of
was already the sixththe entire initiative – that for its
largest bank by assets in its
behemoth Malaysian operations.
country upon inception (and
This Malaysian leg of the
currently the fifth).
1Platform program involved a
total of five mock runs and four
operational readiness tests before a total of nearly
10 million client records were deemed ready to be
migrated. The “big bang” migration was concluded
in February 2014, with no service disruption, no
significant incident and well within budget. By then,
MYR630 million (US$194.7 million) was attributed to
the project’s ongoing expenses.
CIMB Group is in the process of facilitating
CIMB Niaga’s migration onto the 1Platform system,
which is expected to conclude by Q1 2016 and marks
the final leg of the core banking implementation
across the ASEAN region.
Key Performance
Indicators
As of 2014, CIMB Group has achieved 80% system
and process commonality across all holdings
affected by the 1Platform implementation. The
dividends reaped from the new core banking system
17
25 years
of Digital
Transformation
Looking into the Future
CIMB Group expects the potential benefits of the 1Platform core banking system
to become more evident in light of recent developments in the region. As the
ASEAN Economic Community draws closer to formation, the industry has begun
heeding the potential for “qualified regional banking” licenses to be issued.
are two-fold, encompassing benefits for internal
and external stakeholders. Within the bank, the
streamlined core banking system, complemented
by existing MDM disciplines have allowed the
bank to launch both its commoditized and more
sophisticated financial products with minimal
backend disruptions.
The implications of this point alone are diverse:
Benefits for customers and external
stakeholders include:
•Standardization of region-wide front-end
best practices leading to the delivery of
consistent service experiences and nearuniversal availability of product functions
regardless of geography;
•Automatic product calibrations and/or
transfer can be conducted to accommodate
individual customer lifecycle transitions;
•Ability for the bank to match transactions
across all product systems to a customer
though a central customer information
file (CIF), essentially enabling a true
“single customer view” that can recognize
and reward client relationships more
appropriately (in practice, for example,
a customer’s credit limit can be based
on aggregated collaterals, and interest
becomes charged on aggregated utilized
limits);
•Automatic fund reconciliations for bankto-customer (B2C), interbank and intrabank (treasury), including calculations and
transaction documentation;
•Enhanced recognition of inducements and
favorable customer interaction patterns,
leading to more bespoke product bundling
with lower cost and better incentives;
•Expedited application development and
rollout regimes on the regional core
infrastructure, leading to fewer incidences
of system versioning and technological
discrepancies;
•Improved Group-wide data capture accuracy
via using e-forms and paperless client
documentation; and
•Advanced parameterization rules permit
more diverse, country-specific operation
and risk conditions to be captured, leading
to a safer, broader extension of straightthrough-processing capabilities across
multiple business lines;
•Support tracking and monitoring syndicated
loans as lead arranger and/or participating
bank;
CIMB Group expects the potential benefits of
the 1Platform core banking system to become
more evident in light of recent developments in
the region. As the ASEAN Economic Community
(AEC) draws closer to formation, the industry
has begun heeding the potential for “qualified
regional banking” licenses to be issued – banks
that conform to a set of stricter capital adequacy
and business performance measure may soon
be permitted by regulators of participating
nations to operate with greater freedom across
all countries, with the goal of collaborative
financial enhancement for the entire region. With
1Platform’s technological and business synergies
in hand, CIMB Group will emerge as a favored
candidate to support such an initiative.
Additionally, CIMB Group has also alluded
to intentions of capitalizing on the greater regional
data transparency proposed by the AEC. While the
1Platform architecture can already leverage on
multi-jurisdictional data, being given the regulatory
greenlight and putting this into practice would
make CIMB Group, an already formidable superregional player, well-positioned to realize its panASEAN “megabank” ambitions.
•Branch rationalization, where client
accounts are now branch-agnostic, thus
allowing them to greater flexibility in
conducting interactions otherwise limited to
a ‘home branch’.
•Accelerated time-to-market on a product
level is enhanced by much faster delivery
times on a channel level, through branch
and digital touch point process automations;
and
•Overall cumulative benefits valued at a total
of MYR1.5 billion (US$418 million) over the
course of 10 years from going live.
Jakarta, Indonesia: Silverlake Axis’ 1Platform architecture is able to leverage on multi-jurisdictional data to
achieve its ASEAN “megabank” ambitions.
18
19
This Silverlake Axissponsored IDC case study
(IDC #AP7919018X) was first
published in February 2015
and republished here with
permission.
I D C Case Study
a Truly World-Class Core Banking System
25 years
of Digital
Transformation
OCBC Bank
by Michael Araneta and Cyrus Daruwala
OCBC is Singapore’s longest established local
bank, formed in 1932 from the merger of three
local banks, the oldest of which was founded in
1912. It is presently the second largest financial
services group in Southeast Asia by assets and
one of the world’s most highly-rated banks, with
an Aa1 rating from Moody’s. OCBC was also
recently ranked by Bloomberg Markets as the
world’s strongest bank, an accolade that holds a
lot of credibility given the current financial market
turmoil.
The bank’s consumer, business, investment
banking and other specialist financial services
solutions are delivered through an extensive global
network of over 500 branches and representative
offices in 15 countries and territories, including
more than 400 branches and offices in Indonesia
operated by its subsidiary, Bank OCBC NISP.
OCBC’s subsidiary, Great Eastern Holdings,
is the largest insurance group in Singapore and
Malaysia, while asset management subsidiary, Lion
Global Investors, prides itself as one of the largest
private sector asset management companies in
Southeast Asia. Its private banking services are
provided by subsidiary Bank of Singapore, which
ranks among the top 5 global private banks in Asia.
With a dominant presence in both the
consumer and business banking segments in
Singapore and Malaysia, OCBC is among the core
bancassurance providers in Singapore and features
as one of the top players in unit trust distribution,
home loans, personal credit, small and mediumsized enterprises market and the Singapore Dollar
capital market.
During the late 1990s and the early 2000s,
OCBC Group quadrupled in assets and total
customers and simultaneously, in the various
applications and solutions that it has acquired over
the years.
While OCBC evaded catastrophic systems
failures that seemed to have plagued some of its
peers, it was accepted bank-wide that its solutions
20
21
Solution
Snapshot
Organization
OCBC Bank
Operational Challenges
A technology refresh that aligns with the
bank’s transformational New Horizon vision;
to improve product-to-market, to improve
synergies within the Group, and increase
cross-sell.
Solution
Continued deployment and upkeep of
Silverlake Axis Integrated Banking Solution
(SIBS) as the bank’s core banking platform.
Length of relationship
Since 1994 in Malaysia and since 2001 in
Singapore
Benefit
Quicker time and lower cost to market in
terms of rolling out innovative best-in-class
products and capabilities in Singapore,
Malaysia and the rest of the region. OCBC
has become one of the most prolific sources
of channel, product, and process innovation
in the Asia/Pacific region.
and systems at that time were rigid, and it took a
long time (and an army of programmers) to roll out
new products and services, thus retarding time to
market and escalating operating costs. Then, ongoing
maintenance also continued to weigh down the bank,
contributing to recurring expenses and reliability
issues. All these were in turn, directly affecting the
bank’s efficiency and cost-to-income ratio.
As such, a technological transformation and
refresh was in order, not only to support OCBC’s
New Horizon strategy but to assist the bank in
gaining sustainable competitive advantage by
25 years
of Digital
Transformation
delivering on a differentiated customer experience,
deepen its business presence in Singapore, and
craft further inroads into the rest of the region. This
would for instance, equip the institution to better
expand distribution capabilities in Malaysia and
capture market shares within the Islamic banking
and Takaful insurance markets, grow its burgeoning
businesses across Greater China, and build its
private banking business through Bank of Singapore.
A technology refresh would also work to
better harness aggregated synergies and increase
cross-sell and customer referrals among the
various entities within the Group, including OCBC
Singapore, OCBC Malaysia, OCBC Al Amin, Bank
OCBC NISP, Great Eastern Holdings, and OCBC
Securities.
OCBC and Its Journey
OCBC is Singapore’s longest established local
bank, formed in 1932 from the merger of three local
banks, the oldest of which was founded in 1912. It
is presently the second largest financial services
group in Southeast Asia by assets and one of the
world’s most highly-rated banks, with an Aa1 rating
from Moody’s. OCBC was also recently ranked by
Bloomberg Markets as the world’s
strongest bank, an accolade that
holds a lot of credibility given the
A technology refresh
current financial market turmoil.
would also work
The bank’s consumer,
business, investment banking and
to better harness
other specialist financial services
aggregated synergies
solutions are delivered through an
and increase crossextensive global network of over
sell and customer
500 branches and representative
referrals among the
offices in 15 countries and
various entities within
territories, including more
than 400 branches and offices
the Group, including
in Indonesia operated by its
OCBC Singapore, OCBC
Malaysia, OCBC Al Amin, subsidiary, Bank OCBC NISP.
OCBC’s subsidiary, Great
Bank OCBC NISP, Great Eastern Holdings, is the largest
Eastern Holdings, and
insurance group in Singapore
OCBC Securities.
and Malaysia, while asset
management subsidiary, Lion
Global Investors, prides itself as one of the largest
private sector asset management companies in
Southeast Asia. Its private banking services are
provided by subsidiary Bank of Singapore, which
ranks among the top 5 global private banks in Asia.
With a dominant presence in both the
consumer and business banking segments in
Singapore and Malaysia, OCBC is among the core
bancassurance providers in Singapore and features
22
as one of the top players in unit trust distribution,
home loans, personal credit, small- and mediumsized enterprises market and the Singapore Dollar
capital market.
During the late 1990s and the early 2000s,
OCBC Group quadrupled in assets and total
customers and simultaneously, in the various
applications and solutions that it has acquired over
the years.
While OCBC evaded catastrophic systems
failures that seemed to have plagued some of its
peers, it was accepted bank-wide that its solutions
and systems at that time were rigid, and it took a
long time (and an army of programmers) to roll out
new products and services, thus retarding time to
market and escalating operating costs. Then, ongoing
maintenance also continued to weigh down the bank,
contributing to recurring expenses and reliability
issues. All these were in turn, directly affecting the
bank’s efficiency and cost-to-income ratio.
As such, a technological transformation and
refresh was in order, not only to support OCBC’s
New Horizon strategy but to assist the bank in
gaining sustainable competitive advantage by
delivering on a differentiated customer experience,
deepen its business presence in Singapore, and
craft further inroads into the rest of the region.
This would for instance, equip the institution to
better expand distribution capabilities in Malaysia
and capture market shares within the Islamic
banking and Takaful insurance markets, grow its
burgeoning businesses across Greater China, and
build its private banking business through Bank of
Singapore.
A technology refresh would also work to
better harness aggregated synergies and increase
cross-sell and customer referrals among the
various entities within the Group, including OCBC
Singapore, OCBC Malaysia, OCBC Al Amin, Bank
OCBC NISP, Great Eastern Holdings, and OCBC
Securities.
the solution and the platform will need to scale as
quickly as the bank’s businesses wanted to, and do
so in a secure, robust and complaint manner. Given
these ‘mission-critical’ requirements, the Silverlake
Axis and IBM Power Systems combination stood
neck and shoulder above the rest, as testament from
as many as 50 banks in the region that are enjoying
the strategic alliance of SIBS sitting on a robust and
scalable IBM AS400 (Power System) platform.
The total migration for the Singapore
operations from the Tandem system to a more
flexible and cost-effective SIBS was completed in
November 2001, well on time and within budget,
allowing the bank the ability to enhance product
delivery and transaction processing capabilities,
and deliver innovative products to customers with a
shorter turnaround time.
IBM and Silverlake Axis have hitherto
served OCBC’s technological requirements well,
effectively facilitating the account, offering postimplementation support and continually improving
on its service quality. As such, the bank did not see
OCBC was the first to pioneer a mobile banking
application to customers via the Apple iPad and
iPhone devices in this part of the region.
The Solution
OCBC has been a client of IBM and Silverlake Axis
since 1994 in Malaysia and since 2001 in Singapore.
After an extensive nine month long assessment
of the various options available in the market, and
mapping back to OCBC’s long-term, regional, business aspirations, OCBC decided on the Silverlake
Axis Integrated Banking Solution (SIBS) on an IBM
AS400 (Power Systems) Platform. Choosing the right
platform was a very important consideration. OCBC
knew that a typical core banking platform has a
life-span of 8 to 12 years. The big investment aside,
23
the need to reinvent the wheel and invest in any
massive core banking system overhaul as part of its
latest New Horizon strategy. Instead, OCBC’s Head
of Group Operations and Technology, felt that it was
more crucial to ensure that there was an excellent
integration of the core banking system with all
incumbent working systems internally, rather than
to plug-and-play the newest best-of-breed disparate
applications and expect these to elevate the bank’s
technology platform.
To this end, OCBC conducted a holistic
internal study to revisit its technology platform
in 2008-2009, where it analyzed its core banking,
channels, CRM, branches, workflow imagining,
risk management, data warehousing processes
and requirements, and took stock of its existing
technology portfolio, emerging business demands,
and the key implementations or refresh required.
Following this extensive study, OCBC concluded
that the SIBS and IBM partnership had continued
to integrate well with all client fronting systems
(the Internet, branch, ATM and mobile distribution
Banks that are pushing forward with
core banking upgrades will have to
integrate traditionally “noncore”
areas such as data management and
risk management.
25 years
of Digital
Transformation
channels), and provided for the bank’s evolving
business requirements, especially as it maintains
a concerted focus on delivering a superior and
differentiated customer experience and invests in
design delivery capabilities to gain a sustainable
competitive advantage.
While the SIBS solution framework with
IBM Power System remained the most apt system,
OCBC needed to execute a core banking refresh to
enhance some of the existing functionalities. Such
a continued spotlight on technology at the front-end
system is crucial to the bank as it pursues its core
focus of providing quality customer products and
experience. The latest core banking modules that
OCBC continues to employ from the SIBS are the:
Bank-wide Customer Information Facility (CIF);
Financing or loans system to handle the complete
life cycle of loans from the application stage right
up to the settlement of these loans; and, Funding
or deposit system to craft new deposit products to
meet customer needs.
The Benefits
The benefits are principally measureable in qualitative terms, with OCBC expecting to enjoy operational
efficiencies, and quicker time and lower cost to market in terms of rolling out innovative best-in-class
products and capabilities in Singapore, Malaysia and
the rest of the region. The SIBS continues to serve
its intended purpose by enabling the bank to service
increasingly capricious and challenging customers
better and faster than competitors. For instance,
this is illustrated by OCBC enjoying a first mover
advantage and appearing as technology innovators
by being the first to pioneer a mobile banking application to customers via the Apple iPad and iPhone
devices in this part of the region.
From a business perspective, OCBC continues
to excel in customer centricity and continues to offer
new locations, new channels, new products and
new services to both its consumer and corporate
customers. From a technology perspective, they
evolve, renew and build upon new capabilities to
stay relevant to business demands as it forges
ahead in the financial industry — all the while being
supported by proficient partners - Silverlake Axis
and IBM.
Beyond the ongoing core banking
implementation or refresh, the near to medium
term would see the operational and technology
teams focusing on its roadmap to align technology
with business and on reviewing these plans on an
ongoing basis to ensure that internal strategies
24
are continually in sync. This is the bare necessity
given the fact that today’s business environment
is evolving at break-neck speed and industry
practitioners need to react equally promptly to
financial and competitive challenges, new regulatory
mandates, as well as collaborate with various
divisions on businesses and technology innovation
and on introducing novel products and services to
remain pertinent in the market place.
Essential Guidance
Banks that are pushing forward with core banking
upgrades will have to integrate
to their program of work their
organization’s strategies in traditionally “noncore” areas such
From a business
as data management and risk
perspective, OCBC
management. A truly modern
continues to excel in
core banking system will significustomer centricity
cantly scale up a bank’s capabiliand continues to
ties in these two “hot” areas for
2013 and beyond. A program that
offer new locations,
neglects these areas will create a
new channels, new
run-of-the-mill core system and
products and new
represent a missed opportunity
services to both
for real banking modernization.
its consumer and
Core banking vendors such
corporate customers.
as Silverlake Axis, with partners
IBM, have responded and have
come up with propositions in these same areas
of risk and data/analytics — and others as well,
although some of these “others” like social media
or peer-to-peer functionalities can prove to be
more nice-to-have factors in the meantime. Banks
need to understand what exactly their current
and alternative vendors have to offer in these new
areas and how these fit in the vendors’ view of what
a “new core system” is. Furthermore, how a vendor
addresses the “what is your ‘new’ core banking
vision” question will help the bank in determining
whether the vendor will fall victim to the supposed
consolidation of the vendor landscape.
Finally, while cost blowouts and timeline
extensions are common issues in core banking
projects, they will become more pertinent as core
banking projects regain momentum in Asia/Pacific.
Projects will compete for skilled and experienced
This is an excerpt from a
resources for systems architecture and core banking Silverlake Axis-sponsored
IDC case study (IDC#AP
implementation, ultimately making core banking
#AP772602W), “The Tale of
Two Super-Regional Banks
more painful than it should be. However, it is the
and Their Core Banking
adherence to the old but still relevant principles of
Transformation,” published
in September 2013, and
project management that will keep banks on the
republished here with
permission.
path to success.
25
In conversation
25 years
of Digital
Transformation
Staying Ahead and
Breaking New Ground
As Southeast Asia’s largest homegrown FinTech player, Silverlake Axis
continues to grow from strength to strength. Much of the Group’s 25-year
success lies in Silverlake Axis Founder Goh Peng Ooi’s “out of the box”
thinking which ensures the business continually breaks new ground.
In this special interview, IDC Financial Insights Managing Director
Cyrus Daruwala recounts Silverlake Axis’ journey with Goh, who is also the
Group Executive Chairman and the brains behind Silverlake Axis’ unique
system design and concepts. Raymond Kwong, Silverlake Axis Group
Managing Director, also offers a glimpse at where the Group’s future
business growth opportunities will come from.
Daruwala: Let’s start with the background.
At the time and age when Silverlake Axis started,
there were very few packaged applications
available for banks. What gave you the idea of
starting a solution company — and at a time when
the market in Malaysia was (perceived to be)
not ready?
Goh: In 1989, after working almost a decade at IBM
Malaysia, I discovered that banking and finance
systems were very sensitive to exceptions and
disruptions, relying heavily on ‘what you know and
what you’ve been taught.’ Information technology
business is very much about exceptions rather than
norms. The established way of IT solutions might
be able to handle the first few exceptions, maybe
even the next, but then it reaches a point where
it falls apart. I foresaw the arrival of that ‘point,’
and decided it was time to venture out on my own
in the business world and concentrate on what I
was passionate about — attacking the problems of
exceptions and disruptions using mathematics.
Daruwala: You mention ‘information technology
business is very much about exceptions
rather than norms’ and how everything in IT is
about ‘Symmetry.’ Can you please explain the
correlation?
Goh: The IT industry, and in fact almost all
industries, is built and focused on what we already
know, i.e., the norm. Opportunities arise from
not what we already know we can do, but through
innovation, i.e., exceptions. Today, innovation occurs
at a much faster pace, while the historical focus
on the norm makes for a sluggish reaction. In
order to capitalize on innovation, businesses need
to adapt quickly, while not losing sight of what
they do well. It is a paradox. I believe through an
understanding of mathematics, and the application
of mathematical properties such as Symmetry, we
can overcome this paradox and thrive.
Daruwala: What factor has been the key to your
regional success – in banking – when there is so
much more competition now?
From left: Raymond Kwong, Silverlake Axis Group Managing Director, and Silverlake Axis Founder Goh Peng Ooi.
26
Kwong: We are not just a solution provider but a
transformation partner to our clients. For the past
25 years, our core banking software has enabled
financial institutions to grow and transform in this
region. Our first customer is still our customer
today, and we will continue to partner all our clients
as they expand into digital economy offerings. In
addition, we have 100% successful implementation
track record backed by strong management and
software development teams.
Daruwala: Silverlake Axis has made its foray
into mobile payment services to retailers and
airlines. You are also toying with fingerprint reader
technology which enables customers to make
transactions on smartphones without the hassle
of passwords. Are you betting more on biometrics,
wearables and Internet of Things?
Goh: Biometrics, wearables, Internet of Things
— these are just a few examples of ‘exceptions
or disruptions’ in this era. Since the beginning,
we believe the full scope of these exceptions or
disruptions are too numerous to keep track off.
We apply Group and Category Theory to structure
and model the invariants and changes, enabling
us to create a collaborative environment which can
readily absorb and react to each new ‘exception.’
The Silverlake Collaborative Architecture
enables our customers to adapt faster to new
exceptions or disruptions, and to capitalize on
those opportunities presented. Our foundational
and ongoing application of mathematical models
allows us to repeat our track record of contributing
to the successes of our customers, helping them
navigate obstacles and transform into successful
participants in the digital economy.
Daruwala: What are Silverlake Axis’ expansion
plans in the FSI industry? Are they geographical,
are they more products, or new markets? Can
you also indicate if this growth will be organic or
acquisition-led?
Kwong: It is and will be a combination of organic
and acquisition-led growth. Our value-adding
propositions are being continuously enriched and
enhanced. Acquisitions have added depth and range
to the Group’s portfolio of software solutions and
services to value add and support our customers’
transformations initiatives. Our recent acquisition
of Finzsoft has strategically positioned us in the
Australia and New Zealand markets.
27
Cyrus Daruwala is
the Managing Director
for IDC Financial Insights
Asia/Pacific. For the past
14 years in the Asia/Pacific
region, Daruwala has
been working with banks
and vendors to help them
better understand their
customer base and create
effective go-to-market
strategies.
www.silverlakeaxis.com
Published March 2015