SBT's 'in-house' solutions better than outsourcing

For Kerala's premier public sector bank, State Bank of Travancore (SBT) 'outsourcing' does not hold as much charm as developing software solutions 'in-house'. Over a period, it has paid off in terms of reliability, cost savings and efficiency.SBT's achievements include BoS (Bank's Own Software), in-house solutions for internet banking, Y2K compliance, an administrative Web page for internal use, e-MIS system for business and performance tracking for decision makers on an ongoing basis. SBT has become a 'role-model' for several banks for implementing IT solutions without relying much on outsourcing.

Leading the IT pack at SBT is the enthusiastic TG Sudhakar Rao, CM (Systems). "In 1994 when we wanted to implement a retail banking solution, those available in the market had certain limitations. We examined the products of Kale, Infosys, TCS, BancMaster, understood their drawbacks and implemented a user-friendly solution called BoS," Rao said.

It took 10 months and six people to develop BoS, thus entailing 60 man-years as against the normal 120 man-years of work required for such a solution. "It is important it should be technically perfect but also be user friendly because it is operated by clerks. The system should take care of the clerk's mistakes and not the other way," Rao said.

BoS could have been commercially marketed but for banking regulations that restrict banks from undertaking any non-banking activity other than through a subsidiary.

Now BoS has been deployed across 220 fully computerized branches in SBT with a near zero failure rate. Rao said his stint as an engineer at ISRO being part of a team that develops mission critical applications has helped a lot in banking. He also took the pains to learn banking theory, practice and operations after taking an MBA in Finance. "As in space applications a small error in banking software and systems can also result in huge loss of money and customer confidence," he said. The projects could be implemented because SBT Management had confidence on the capabilities of the Computer Policy and Planning department and given operational autonomy. Moreover, the department is filled with managers with banking expertise and engineers selected from select institutions who had experience in implementing critical projects, Rao said explaining the SBT's in-house successes.

Moreover, employees in branches co-operated to computerization largely because solutions were designed "in-house' and they did not require outside help for maintenance.

When banks spent lakh of rupees outsourcing their Y2K compliance problems SBT did it in-house at a lesser cost. Similarly, for implementing the Internet banking solution, the CPP department struggled with Web page design and other features for over four months. The result was a first in-house banking solution for Internet banking. Now it has 5,000 satisfied customers spread out in Saudi Arabia, UAE and US logging into sbt.co.in for account browsing. 

Another first, e-MIS, is now under pilot testing. Under this 'third generation' MIS, data will be uploaded from the branches through a Web browser to the corporate Web server (www.sbt.co.in). This will be stored in an optimized database engine with a navigator capable of producing effective summaries. The most vital statistics created by the branches referred to as Flash Data or Dash Board Data (DBD) will be forwarded from the corporate Web server.

The DBD will be instantaneously available for analysis by decision-makers in any geographical location by logging on to the corporate Website. Online submission of data avoids repetitive data entry at different levels due to incompatibility of data formats and data demand at various levels of decision hierarchy. With this decision makers at different levels will get a summary of the branch wise and overall performance figures related to credit, deposits and other income updated to the last month at the click of a mouse.

The bank had earlier introduced an administrative Web page for internal use whereby branches can download software, chat, send and receive directives. The bank is not enthusiastic about networking of branches because world wide only three percent of bank customers need 'anywhere money' facility. When 'networked ATMs and internet banking' can provide customer's most urgent requirements why waste lot of money on networking. 

(CNS)