IT for the Banking Industry

Download Evergreen's Financial Services ITAM brief offer here.

Meeting Today's Critical IT Financial Services Challenges Using IT Asset Management

Today's IT challenges to the financial services sector are greater than they have ever been, primarily as a result of the:

• Sub-prime mortgage market crisis
• Volatility of the stock market
• Overall financial state of the U.S. economy

Recent research on financial services reveals that IT budgets are likely to shrink if economic conditions continue to worsen, but demand for technologies that improve efficiency will continue.*

IT Spending in 2008-All About Efficiency

The research indicates that although there is a general retrenchment in IT spending, the financial services industry will still spend on maintenance activities associated with existing applications infrastructure instead of investing in new technology.

Not surprisingly, research results indicate a strong move toward efficiency in technology investments for 2008. 'Bankers were fairly clear in their desire for investment in areas that will drive efficiency first, but also growth for their business lines.'

Addressing the IT Challenges to Financial Services

The financial services sector will be challenged to:

• Leverage legacy core technologies to reduce maintenance before investing in new technologies.
• Invest in technologies that lend themselves to ROI calculation for comparing in-sourced versus outsourced IT resources freeing up valuable resources.
• Improve fraud prevention and heighten security.

Meeting Today's IT Financial Services Challenges with IT Asset Management and HP AssetCenter™

The challenge for financial services is straightforward - optimize and modernize existing technology assets to free up funds for strategic IT investments.

Evergreen's No-Risk Asset Value Recovery Offer

Evergreen offers clients an IT software license and hardware maintenance solutions that is guaranteed:

• Allowing the organization to better plan software purchases and manage upgrades and new release deployments regularly, saving money and meeting the goals of cutting costs while improving service.
• Enabling financial service institutions to become more competitive by optimizing their existing investment in hardware and software and freeing up additional funding for investment in industry automation and branch improvement technologies.
• Providing for IT projects that yield easily calculated ROI for comparison with outsourced solutions.

Help Is On The Way with Asset Value Recovery

The Evergreen Systems no-risk Asset Value Recovery offer gives your organization a clear path to meeting these IT challenges by combining experienced Asset Management process improvement with HP state-of-the-art AssetCenter technology. It's a 'no-risk' offer that will quickly audit hardware and software license and lifecycle management, reconciling contracts against actual devices and software. It leaves your organization with a detailed assessment of recovered assets, formatted in HP AssetCenter, laying the foundation for your organization's configuration management database and a basis for service catalog initiatives. See our No-Risk ITAM Offer.

* Exclusive TowerGroup Research Report: Bank Tech Spending in 2008, by Jim Eckenrode, Global Banking Research Fellow, TowerGroup, Bank Systems Technology, February 21, 2008.

Download Evergreen's Bank Technology Success Story.

The banking industry faces challenges and opportunities unlike any they have faced in the past, including:

• Increased competitive and margin pressures
• More stringent compliance regulations
• Need for continuous availability in order to satisfy increased customer demands
• Intense pressure on IT infrastructure to support the transition from paper to electronic based records forcing significant new investment in security, network capacity, system performance and storage and server management and provisioning.

IT trends underpinning these challenges include:

• Open data/messaging standards for the transfer of inter-institutional data
• Multi-channel integration following a flurry of mergers and acquisitions putting significant pressure on organizations to integrate IT infrastructures with multiple, disparate technology platforms
• Intense pressure on eCRM systems to provide a '360 degree' view of customers for customer service and retention
• Controlled legacy conversions of older platforms that still perform valuable and mission-critical functions, requiring middleware and SOA (Service Oriented Architecture) solutions. Like universal translators, these versatile tools allow institutions to expand new technologies effectively while still harvesting benefit from older systems, for a longer period of time.
• Centralized technologies that address identity management, data security and enterprise-wide compliance.

Integrating all of these changes into both the enterprise, as well as the IT infrastructure, is the challenge faced by all major banking institutions today. Addressing these challenges will delivery substantial cost and efficiency benefits to the industry. Not addressing them could mean failure to keep pace with the changing face of the market. Successful financial institutions will address these challenges through:

• Powerful, customer-focused IT infrastructure that addresses the customer from a '360 degree' eCRM system(s)
• Transparency, when it comes to regulation. IT systems that make compliance 'transparent' to IT and IT infrastructure will be necessary for survival

Case Study

Cleveland-based KeyBank is one of the nation's largest bank-based financial services companies, with assets of approximately $93 billion, and provides investment management, retail and commercial banking, consumer finance, and investment banking products and services to individuals and companies throughout the U.S. and internationally.

In the fall of 2004, KeyBank's Enterprise Technology Operations (ETO) organization engaged Evergreen Systems, Inc., an ITIL consulting firm headquartered in Sterling, Virginia, to assist ETO in developing a successful IT Asset Management (ITAM) program. ETO recognized there was an opportunity for significant improvement to the effective procurement and management of IT Assets and had made a commitment to standardizing critical processes around the ITIL framework. Evergreen brought their knowledge of ITIL® best practices to the table to help jump start the ETO program.

The Challenge

KeyBank's server inventory in their two primary data centers and their remote locations was unreliable. The ETO server environment was growing at an average of 25 servers a month and had rapidly reached a total of approximately 2,150 servers in the data centers. With no strong asset management discipline in place, additional servers were being purchased when there were existing unused servers that could satisfy the new demand. Additionally, new data center projects were kicking off that would require accurate, up-to-date information about the IT assets.

'As a result of several large infrastructure projects requiring a complete inventory of our data centers, we determined we needed a more efficient way to provide accurate inventory data. We engaged Evergreen Systems to help us blend our current processes with ITIL best practices to come up with an effective ITAM program. We are now able to produce accurate information regarding data center assets in a matter of minutes rather than weeks. While this is a huge accomplishment, we believe it is just the tip of the iceberg for the benefits we'll derive from this program,' said Lindy Losowski, Vice President, Enterprise Capacity Services, Enterprise Technology Operations.
KTS and Evergreen decided to take a systematic approach to the challenge, defining the following phases for the project:

• Assessment
• Process Reviews
• Recommendations and Solutions
• Design and Implementation

Assessment

Based on industry best practices, Evergreen evaluated the ETO ITAM approach including policies, processes, and enabling technologies. The assessment revealed that improvements could be made in:

• Governance over ITAM responsibilities
• Establishing consistency in the procurement, receiving, maintenance and retirement processes
• Asset spending through better tracking and reclamation of IT assets
• Costly manual physical inventories
• Redundant IT asset repositories housing multiple technology verticals

Recommendations

Evergreen recommended that ETO :

• Establish a framework for the ITAM organization incorporating the strategic development, governance, institution and management of ITAM Policies and Processes on behalf of KeyCorp.
• Develop a definitive IT asset repository for managing the physical, financial and contractual information pertaining to IT assets throughout their lifecycles.
• Define an ITAM program for procuring, installing, maintaining and retiring IT assets including policies, processes, roles and responsibilities and enabling technologies.

'We have been evolving our asset management processes pertaining to PCs over the past few years. What we needed was a complete lifecycle program across all asset classes. Partnering with Evergreen enables us to do just that', said Paul Huss, Manager, IT Asset Management.

Implementation

Evergreen and the ETO ITAM team developed an overall project plan to implement all aspects of the ITAM program including:

• Establishing goals for the overall program and short-term and long-term objectives for each core process.
• Forming a governing body to review and approve all outputs of the ITAM deliverable.
• Assisting in the development of policies and standards for ITAM.
• Assisting in designing the global ITAM processes.
• Facilitating the comparison of current processes and gaps against the global process.
• Facilitating the design of the new processes applied to specific asset classes.
• Coordinating the development of an ITAM guide and the training and adoption plan.
• Providing knowledge transfer so that the ITAM team can continue to grow the ITAM improvements over time.
• The assessment highlighted several processes for review:
• Request process
• Procurement process
• Receiving and deployment process
• Maintenance and retirement process

Evergreen and the ITAM team evaluated the current process against best practices and designed recommended process changes through a set of iterative workshops. The following is a summary of the key recommendations and implemented solutions for each core ITAM process.

Request processes formalize the control of asset requests, eliminate unauthorized purchases and reduce the number of unnecessary asset purchases. Existing KeyBank request procedures and processes were resulting in inefficiencies in the effective use of asset inventory and data center capacity. By establishing a standard process for checking inventory availability and capacity, ETO was able to avoid purchasing unnecessary servers.

Procurement processes should formalize the approval process and procurement policies, as well as automate integration between purchasing and the asset repository for catalogs, new purchases and shipments. Improvements in ETO vendor information, approval processes and asset records were identified as opportunities for improvement. By updating vendor information, integrating systems and standardizing approval and shipping processes across disciplines, ETO was able to improve efficiency by creating a standard procurement process for all servers.

Receiving and deployment processes are intended to formalize a process that accounts for the receiving and installation of all servers in the data center and remote locations and strives to achieve a 98% level of accuracy regarding asset data in and through all server repositories. This level of accuracy is achieved only through asset tracking at the time of installation and throughout the asset lifecycle. Integrating vendor shipment records through automated vendor interfaces and using bar code technology for recording the receipt and installation of an asset yielded vast improvements in efficiencies of the receiving and deployment process.

The ITAM maintenance and retirement processes improve asset utilization and reuse through recycling of servers and more effective disposition of decommissioned assets. ETO needed to improve its asset identification because asset tracking of maintenance was not done at the serial number level. In addition, ETO needed to integrate multiple asset repositories. These requirements were addressed by reducing the number of data repositories, integrating asset management with change management and establishing a more formal change order process. Through the use of asset management reports and process disciplines, an immediate improvement in asset lifecycle management was achieved.

Once all process and technology changes were implemented, Evergreen and the ITAM team developed a detailed ITAM user guide with detailed process and procedures for both the business processes and the enabling technologies. The ETO ITAM team developed a formal user adoption and training plan, developed training materials and led all training classes. This last step ensured final knowledge transfer from Evergreen to the ITAM team, enabling them to take on additional asset classes without Evergreen's assistance.

Results

The benefits of a successful implementation of an ITAM program at KeyBank were sweeping and included:

• Clear governance for ITAM.
• Increased efficiency in business operations.
• Proactive management of IT assets.
• Introduction of continuous improvement processes.
• Increased fiscal responsibility.
• Introduction of operational metrics and measurements.
• Better employee focus and enhanced productivity.

Beginning with servers, Evergreen and the ITAM team have established a solution that will realize all these benefits over time as ITAM applies these new processes to each asset class.

ETO has also engaged Evergreen to assist in taking asset management to the next level and developing a Configuration Management program that will define the physical and logical relationships of the managed assets. They are working to automate and improve processes through enabling technologies and ongoing process improvements to implement a Configuration Management Data Base (CMDB).

'Our Distributed operations have grown large and reliable, but unstructured. ITAM, Configuration Management, and the ITIL framework are giving us the tools and roadmap to optimize this environment. I expect a 24 month payback and a much more finely tuned appetite for computing resources in the future as a consequence. Evergreen takes a practitioner's approach to interpreting best practices and helping us adopt nothing more than what we need to achieve our objective', said Al Coppolo, KeyBank, Executive Vice President, Enterprise Technology Operations.