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Nationwide builds foundation with live pilot of SAP core banking system

Building society highlights knowledge challenges around legacy softwar

Building society Nationwide has completed the first live pilot of an SAP system for core banking, and is now testing the software further.

As part of a £300 million business transformation programme, Nationwide is moving to SAP banking platforms and a service oriented architecture, in an attempt to improve business processes and launch tailored products more quickly. In the programme, called Voyager, it is working with IBM, Capgemini and KPMG.

Phil McCabe, core platform director at Nationwide, told delegates at the SAP Financial Services Conference in London that the first live pilot for the new setup "took place in January this year", following the start of the Voyager programme four years ago. The next stages will address savings, mortgages and loans.

The banking go-live followed extensive testing, which included linking SAP modules to a raft of legacy systems.

SAP Deposits Manager is now live at Nationwide and the Business Partner system is "loaded with 15 million customers", McCabe said.

"We have seen a significant shift in our product capabilities, and we can offer more tailored services," he said.

"The next stages of the programme are being designed. There are five areas of focus for us in getting it right: communication, governance, collaboration, proper methodology and focusing on the learning curve."

There had been some significant obstacles during the programme, McCabe explained. "The challenge is designing the new while maintaining the old. There limiting factors were the lack of knowledge in some existing legacy systems and processes, and having the right tech people at the right time."

Nationwide is the world's largest building society, and the UK's third largest savings and mortgage provider. It employs 16,000 staff, and runs 800 branches.

It runs 300 applications, 12 mainframes, 4,800 servers - of which 62 percent are virtualised - and has 2,876 terabytes of data storage. It expects a five-fold increase in the number of payments it will process over the next five years.

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