System Access - A Little Firm Makes Good in the Global Banking Industry

Singapore-based Systems Access, a "back office" software provider for the banking industry, could be defined as the classic entrepreneurial success story. Founder Leslie Loh launched a one-man software firm in 1983. The following year, he was able to offer global banking giant CSFB a PC-based solution for one-twentieth the price of a typical competitor. Four years on, System Access was well on the way to becoming an industry leader, mainly by exploiting new IT systems to offer banks highly affordable solutions. Affiliate Professor of Operations Management and Entrepreneurship and Family Enterprise Michael Pich relates how Loh and his fast-growing workers so readily grasped the implications of the enormous changes then affecting the global banking industry.

by Michael Pich
Last Updated: 23 Jul 2013

Singapore-based Systems Access, a "back office" software provider for the banking industry, could be defined as the classic entrepreneurial success story. Founder Leslie Loh launched a one-man software firm in 1983. The following year, he was able to offer global banking giant CSFB a PC-based solution for one-twentieth the price of a typical competitor. Four years on, System Access was well on the way to becoming an industry leader, mainly by exploiting new IT systems to offer banks highly affordable solutions.

Affiliate Professor of Operations Management and Entrepreneurship and Family Enterprise Michael Pich relates how Loh and his fast-growing workers so readily grasped the implications of the enormous changes then affecting the global banking industry. Deregulation was making the sector far more competitive. But most major players chose to focus far more on revenue generation than on cost cutting, and also often tended to rely exclusively on back-end solutions in doing so.

The firm's introduction of Symbols, the first customer relationship management (CRM) software application designed exclusively for the wholesale banking sector, had enormous promise. It immediately established itself as one of the most technologically advanced and comprehensive back-end core banking solutions. If Symbols could become one of the industry's standard CRM systems, Systems Access could have a wide vista of highly lucrative market segments, in which it had yet to enter, before it.

Pich offers a concise, but thorough analysis of the affects CRM systems have had within the banking sector overall. CRM systems have revolutionised the handling of customer information, enabling banks to exploit the data in efforts to maximise both short- and long-term revenue. Not only can banks or other institutions now respond to customer needs in real-time, but CRM solutions can also even allow customers to have input in the R&D and product design phases of new product development.

However, as Symbols project manager Giridhar Nayak well appreciated, delivering reliable, cost-effective CRM solutions is often difficult. Perhaps a half of all CRM systems fail, costing the users more than the anticipated savings. Implementation times can be far longer than forecasted. Pre-packaged, generic products can also prove hard to adapt. Bottlenecks, often inherent in the design of CRM processes, are also commonplace.

Symbols had proven adept at being able to address many of the legacy-based problems that had typically created bottlenecks within other CRM systems, having been designed from the outset with a streamlining process. The author succinctly explains the technical differences between certain custom-built, "middleware" software systems that often crashed and could be tediously slow, and the superior performance of Symbols. The latter is able to insert a common transaction handler between a system user's front and back ends, thereby avoiding the patchwork constraints of most middleware systems.

Symbols was far from an easy system to design, however, and Pich relates the various issues regarding technological constraints that needed addressing by Giridhar's team before the system's release. The smooth handling of transactions, whether initiated by the client or by the bank, demanded a highly sophisticated two-way information flow.

Designing a back-end legacy system that was both interoperable and fast was also easier conceived of than realised. And naturally, it might simply be asking too much for such cutting-edge systems designers to always be keeping the client's bottom line cost-effectiveness considerations at the mental forefront when coming up with such revolutionary designs.

Pich concludes by discussing the critical trade-offs that Giridhar's designers were contemplating when designing Symbols, its siloed legacy database, the Enterprise Operation Center (EOC), and the Enterprise Application Integration Framework module. What factors determined how much of the system should be moved to a node, or should be kept at the EOC? What were the trade-offs among issues such as the system's cost, speed, storage capacity and functionality? And were there any drawbacks to the paradigm of replicating data housed in silo legacy systems, vis-à-vis real-time data access? If so, what were they?

INSEAD 2004

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