7 Steps to Smarter Integration
Sometimes, change can be worthwhile. The key is knowing what's worth pursuing and what's not.
The financial crisis led to some hasty mergers between financial services companies, including Bank of America's purchase of Merrill Lynch, JPMorgan's purchase of Bear Stearns and Wells Fargo's purchase of Wachovia. Mergers are tough for these companies even in the best of times, thanks to their highly complex and heterogeneous IT systems.
Consider some statistics cited by IT Business Edge blogger Loraine Lawson in a post about banks' integration challenges:
Despite these kinds of historical problems and added pressures because of the high profile of the deal, Wells Fargo's integration of Wachovia's IT systems with its own appears to be proceeding smoothly. Loraine wrote about it last summer, sharing four lessons learned from the companies' strategic approach to the integration project. They are:
I addressed the integration topic in my recent interview with George Tumas, executive vice president and CIO of Wells Fargo's Internet Services Group. Tumas mentioned the target operating model, which helped the company create its goals and timelines. For instance, it was decided Colorado would be the first state with overlapping service areas to be converted, a project that was successfully completed less than a year after the deal between the two companies closed in late 2008. Following that success, schedules for conversions in different lines of the business and different geographies were established.
Another important lesson, which Tumas mentioned to me more than once during our interview, is to focus on the needs of the customer. He said:
A lot of the timing of the conversions was really focused on the customer. We wanted to make sure our customers knew what was happening, from a front-end and back-end perspective. ... One might say, "You're taking a long time to do this, Wells Fargo." But we want to keep our customers in mind, making sure they understand what's happening.
It isn't as if the companies created an entirely new approach to integration. Instead, they relied on project management fundamentals such as frequent communication between business and technology partners. That's been the standard in the Internet Services Group for over a decade. Tumas told me his staff is co-located with the business, which "really helps with resolving issues and getting good camaraderie between the groups." He said:
Not to say there can't be good communication in a more traditional model with business on one side and IT on the other, but I think we've taken it to the next level. Are there disagreements? Absolutely. But there's a true partnership in getting disagreements resolved and moving forward.