Before a core banking project gets underway, it is vital to gather relevant information in order to achieve the desired end result. This “scoping” of requirement as part of presales is critical for successful implementation of a project. In a core banking context, project scope includes the identification of modular components like Trade Finance, Corporate Loans and so on, as well as optional features. Certain solutions, such as AML and Basel II/III are mandatory across banks worldwide regardless of whether or not they are explicitly mentioned in the requirement list.
Vendors should seek any clarifications at the concept stage to better align their products with the banks’ needs, as even the most comprehensive requirement list can have elements missing. Vendors need to ask the right questions and gather pertinent information in order to better design products or solutions. That being said, the stated requirements could be interpreted differently, which could lead to an expectation mismatch. Often, complexities arising from different geographies also compound this problem. Despite being aware of the exact requirements, vendors sometimes tend to interpret them to fit their product profile resulting in scope creep as part of project implementation, increasing effort and cost.
Vendors submit a comprehensive bid document, which outlines the solution capability, design and price, for banks and consultants to evaluate. Since approvals are sought on the basis of this document, the bid price quoted by vendors cannot change drastically after the requirement analysis. Therefore, vendors need to be prudent in pricing their offering and allow for possible mismatch between the requirement analysis and bid document. Low presales pricing, which later increases on account of scope creep during implementation could lead the vendor to over-promise and under-deliver, whereas higher pricing during presales may adversely affect their prospects during evaluation. Presales expertise based on hands-on banking knowledge and sound judgment with fairly accurate assumptions will assist long-drawn core banking projects.
In summary, incorrect solution design with improper scoping will lead to failed implementation or extended delivery timelines, marring the vendor’s reputation; whereas, one that is well thought-out, with detailed analysis and scoping, will ensure smooth and successful project delivery.