Keeping up with current technologies can present problems in any business, especially if the organization is used to doing things ‘the old way’ with limited resources.
Introducing mass changes to a business that is set in their ways can be challenging, but with dedicated efforts, training and expert guidance, the old way of doing things can be successfully transformed into new efficiencies and technologies.
Here is a case study demonstrating how First Hawaiian Bank overcame its outdated systems and limited island resources to reimage itself as a digital bank not only for Hawaii, but for Saipan and Guam as well.
Quick Company History: In 1858, Charles R. Bishop and William A. Aldrich responded to a need for a responsible banking system brought on by the growth of the whaling industry. The two created Bishop & Co. in a small corner office near Honolulu’s waterfront. Achieving statehood in 1959, Hawaii grew economically, fueled by sugar, pineapples, and tourism. The bank changed its name in 1969 to First Hawaiian Bank and has 54 branches in Hawaii, Saipan, and Guam, with over $20 billion in assets.
First Hawaiian Bank’s Dilemma: A Need for Modern Systems, But Limited Resources to Move Forward
Situation: First Hawaiian Bank needed to outsource its onsite Systematics Core & Mainframe because of several deciding factors:
- System obsolescence
- Increasing maintenance costs
- Talent scarcity
It was also time to reimage First Hawaiian Bank as a digital bank for Hawaii, Saipan & Guam.
Problem: These are all good ideas:
- Outsourcing core banking to FIS
- Switching from Systematics to IBS…
- Performing a digital transformation with Digital One
- …And keeping it all balanced
However, if finding the required skills is hard on the mainland, it’s even harder on Oahu. Remote support services and mainland staff augmentation help, but they cannot replace the necessary banking talent of the existing staff.
First Hawaiian Bank is a 175-year-old bank set in its ways. Introducing massive changes in processes, job functions and systems is challenging – doing it with overworked employees is even more difficult.
Implement Needed Changes to Move Forward
As with any organization, especially those with set-in-stone ways of doing business, change is difficult. Compound that with limited resources and employees that are already strained – and implementing change can be arduous – but definitely not impossible.
Steps Taken to Move First Hawaiian Bank Forward
Step 1: Build a foundation for change with one big heavy lift for existing employees, then pass requirements to outsourced teams to create and perform.
Step 2: Use testing activities and implementation events to train staff on new systems, processes and enterprise balancing.
Action: Here’s a concise summary:
- Use existing employees to map and document processes for current systems being affected by core outsourcing and digital replacement.
- Describe 3rd party interfaces, both existing and new.
- Reimagine and map the processes for a new outsourced core and digital presence.
- Establish new GL and balancing processes for a new general ledger and enterprise.
Keep the momentum going strong:
- Establish outsourced development teams to create 3rd party interfaces and controls.
- Organize internal FHB subject matter experts with FIS support teams to configure IBS and Digital One.
- Develop end-to-end testing scenarios with subject matter experts and use the testing experiences to train staff.
- Use Readiness Review sessions with FIS to train both teams to work with each other.
Finally, teach bankers through the implementation process how to balance the applications, enterprise, and individual GL accounts.
Outcome: Mission accomplished. It took 28 months to perform outsourcing and transformation with existing staff, without customer impact:
- Successful implementation of well-documented new processes
- Trained staff members experienced and working with the outsourced systems and vendor teams
- New GL system updated for the new systems and processes with experienced, well-trained balancers
Time frame: 28 months to perform outsourcing and transformation with existing staff – and without customer impact.
Patrick Martin is an industry expert in banking technology, deciphering the elements that work collectively towards progress – and building a roadmap for successful execution. Contact him today to see how he can use his innovative strategies and industry expertise to help your organization.