As one of the earliest adopters of the DNA core platform — first offered by Open Solutions and later acquired by Fiserv — KeyPoint Credit Union ($938M, Santa Clara, CA) had seen years of customization take its toll on this crucial system.
Within a decade, its system held more than 1,400 account types, including 75 separate accounts for certificates alone and a heap of residential loan variations such as non-conforming super jumbo mortgages.
CU QUICK FACTS
KEYPOINT Credit Union
data as of 09.30.14
HQ: Santa Clara, CA
CORE PROCESSOR: Fiserv DNA
HOME BANKING: Digital Insight
MOBILE BANKING: Digital Insight
“There was no practical value in maintaining that type of architecture,” says Sam Tuohey, the credit union’s chief operating officer. “Our DNA core had been customized to the point where Fiserv couldn’t support it and the system couldn’t take advantage of new modules for things like report writing for loan participations or activity managers for workflow processes.”
In light of these limitations, KeyPoint decided to undergo a core conversion … to the same platform … and has been working for the past year on what it calls a core “re-conversion” to go live on Feb. 2, 2015.
When the process is complete, the credit union will be managing approximately 80 account types, which offers efficiencies on and off the balance sheet.
Moving Forward While Staying Put
“Remodeling your house can be inconvenient while the work is being done, but moving to another house is often even more disruptive,” he says. “DNA is a good system and Oracle is a good database, but we weren’t using them as efficiently as we could. We had customized it for years based on the needs of the moment and it just got too unwieldy.”
To date, the most labor-intensive part of the process has been deciding how to reconfigure the accounts.
When Tuohey arrived at KeyPoint in late 2013 as one of several new managers hired by incoming CEO Brad Canfield, who had replaced longtime leader Tim Kramer in 2012, the credit union was already thinking about reconverting. It held the project’s formal kickoff meeting and launched the RFP process in February 2014.
KeyPoint considered other vendors, but according to Tuohey, Fiserv’s Open Solutions team “didn’t have to go through the whole, grand, dog-and-pony show, and the negotiations weren’t so long and wicked.”
No Pain, No Gain
KeyPoint is approaching this re-conversion more as an elaborate form of housekeeping. Open Solutions, however, is following much of the same processes it uses for full-on core conversions, including enlisting its own conversion specialists.
And although both parties do anticipate some slight bumps in the road, to date, the most labor-intensive part of the process has been deciding how to reconfigure the accounts.
“We’ll do a data slice and send it to Open Solutions,” Tuohey says. “They run it through their system and send it back to us for our testing.”
The re-conversion process itself might be unusual, but the factors that prompted it are not.
When asked why KeyPoint did not simply switch cores, Tuohey likens the decision to choosing between moving to a new home or renovating an existing one.
Running its own software through the conversion is a new experience for the Fiserv specialists and has required some trial runs to prepare. There’ll be a learning curve in-house, too, Tuohey says, but not a steep one because much of the front-end will look the same as before, only easier and more intuitive.
“We won’t have nearly the training initiative we’d need if we were converting to a brand-new system,” Tuohey says.
In fact, the only real potential obstacle identified so far has been how to manage connections between the core and ancillary software such as home banking and mobile apps.
“We’ve revisited every interface we have,” Tuohey says. “Many were fine, but some had to be tweaked and others had to be rewritten. Given that we’re migrating to a conventional version of DNA, our third parties are well equipped to support these changes.”
The re-conversion calls for new hardware; however, the existing server system will continue to run the current DNA software while the credit union’s new account processing system is configured and tested. Extensive due diligence testing will take place through the process, Tuohey says, and when all is finally ready, the credit union will go dark on a Saturday and come back up on the following Sunday.
“After that, things will essentially look the same to members because our online banking is staying the same,” Tuohey says.
Although downtime has not been a problem with the current system, staff can expect to see faster backups and searches once the credit union deploys the new platform.
No Looking Back
The re-conversion process itself might be unusual, but the factors that prompted it are not. After all, both credit unions and banks are trying to meet evolving operational and compliance needs. And although some of the system modifications that prompted the re-conversion were necessary, others were probably overkill, Tuohey says, adding that it’s easy to second-guess what was done in the past.
“I wouldn’t want our organization to think we’re never going to customize software again,” he says. “Sometimes you have to. If you have the right people, take the right amount of time, and test it properly, generally you’ll do OK.”