1. © 2012 Tieto Corporation
A Practical
Application of
Enterprise
Architecture in
Commercial
Banking – the
Ecobank Example
Kims Šifers
Principal Business Consultant
Cards, Tieto Financial Services
kims.sifers@tieto.com

2. Contents
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Introduction
Strategy
Operating Model
Enterprise Architecture
Engagement Model
Fruits of Unification and Lessons Learned
© 2012 Tieto Corporation

3. Introduction
• Presentation based on Enterprise Architecture as Strategy:
Creating a Foundation for Business Execution (Hardcover)
by Jeanne W. Ross, Peter Weill, David C. Robertson
• A Practical Application of Enterprise Architecture in
Commercial Banking – the Ecobank Example
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© 2012 Tieto Corporation

4. Ecobank Strategy: Build the
platform – 1985-2011
• Pan-African full service banking group
• 32 African countries
and France
• $17.2 billion assets
• 8.4 million customers
• 23,355 employees
• Strategic alliances
• Single IT platform
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© 2012 Tieto Corporation

5. Ecobank Strategy: Develop scale
in key markets – 1985-2011
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Focus on performance:
• risk management
• customer service
• capacity building
• Optimize balance sheet:
• diversify funding sources
• optimize capital allocation
• Develop key businesses
• Proactive inorganic opportunities to build market share
• Target key customer segments
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© 2012 Tieto Corporation

6. Ecobank Strategy: Growth
acceleration – 2012-2014
• Seek to be Top 3 in all markets and #1 in key parameters
• Exploit international opportunities
• Capture efficiency & process improvements through
centralization & outsourcing
• Investment in key growth drivers
• Fill out holes in network
• Enhance profitability & operating efficiency
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© 2012 Tieto Corporation

7. Ecobank’s Strategic Challenge
• In Commercial Banking you need to minimize costs – this
comes from operational efficiency
• Every affiliate (Ecobank country) was doing its own thing
• Very expensive from a procurement and operational point of view
• Uneven risk and quality
• EcoBank and Africa is very large – 29 different countries
and cultures – Africans are different
• Ecobank understood that efficiency had to be improved and
cost reduced
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© 2012 Tieto Corporation

8. Ecobank Strategic Thinking
• The leading Ecobank Information Technology and Operation
Managers come from CitiBank
• Ecobank Managers implemented an Enterprise Architecture
Strategy as they had in CitiBank
• Large Multi-International Customers act in similar ways
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© 2012 Tieto Corporation

9. Steps in Implementing Enterprise
Architecture
I.
Operating model – Global Business Processes are
dependent upon Business Goals
II. Enterprise architecture – This is dependent upon on
the Operating Model chosen
III. IT engagement model – You cannot implement an
Enterprise architecture without project governance
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© 2012 Tieto Corporation

10. I. Operating Model
Business
Process
Integration
High
Coordination
Unification
Low
Diversification
Replication
Low
High
Business
Process
Standardization
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© 2012 Tieto Corporation

11. More Details about the Operating
Model:
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Coordination
Shared customers, products, or suppliers
Impact on other business unit transactions
Operationally unique business units or
functions
Autonomous business management
Business unit control over business process
design
Shared customer/supplier/product data
Consensus processes for designing IT
infrastructure services; IT application
decisions made in business units
Unification
Customers and suppliers may be global or
local
Globally integrated business processes
often with support of enterprise systems
Business units with similar or overlapping
operations
Centralized management often applying
functional/process/business unit matrices
High-level process owners design
standardized processes
Centrally mandated databases
IT decisions made centrally
Diversification
Few, if any, shared customers or suppliers
Independent transactions
Operationally unique business units
Autonomous business management
Business unit control over business process
design
Few data standards across business units
Most IT decisions made within business
units
Replication
Few, if any, shared customers
Independent transactions aggregated at a
high level
Operationally similar business units
Autonomous business unit leaders with
limited discretion over processes
Centralized (or federal) control over
business process design
Standardized data definition but data locally
owned with some aggregation at corporate
Centrally mandated IT services
Low
Business process standardization
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© 2012 Tieto Corporation
High

12. Diversification
• This where EcoBank started through a series of
mergers:
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Few, if any, shared customers or suppliers
Independent transactions
Operationally unique business units
Autonomous business management
Business unit control over business process design
Few data standards across business units
Most IT decisions made within business units
• However, there are cases when diversification should
be applied because e.g. Business unit control over
business process design
• IT must serve business
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© 2012 Tieto Corporation

13. Unification
• This is what EcoBank wanted to Achive – EcoBank
wanted to absorb its mergers
• Customers and suppliers may be global or local
• Globally integrated business processes often with support of
enterprise systems
• Business units with similar or overlapping operations
• Centralized management often applying functional/process/business
unit matrices
• High-level process owners design standardized processes
• Centrally mandated databases
• IT decisions made centrally
• This is preferred because economies of scale are
gained and a common way of doing things – easier to
control and understand
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© 2012 Tieto Corporation

14. I. Ecobank’s Operating Model
Considerations
• Ecobank operates in 32 countries
• Ecobank had strategic goals in relation to Tieto to:
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Improve Risk Management and Customer Service
Build capacity
Get to a single IT platform
• Ecobank, taking into consideration Strategic Goals, chose
the Unification Operating Model
• After choosing the Operating model, the Next Step is to
choose the Enterprise Architecture
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© 2012 Tieto Corporation

15. Strategic Business Reasons for
Unification
• Common Business Processes – but it is not so easy
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Easier to train staff
Higher quality level
Easier Statistical Analysis
Result of Common Business Process are lower costs
• Common Security Platforms – trust is key for the bank
• PCI DSS Certification – based on procedures and their
implementation - harder with different technical procedures
• Chip (Smart) Card – to reduce Fraud losses from counterfeit cards
• Easier to Launch New Products across the Group –
EcoBank is Pan African
• EcoBank Private label cards – upgrading to CPA
• Instant Debit Cards
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© 2012 Tieto Corporation

16. II. The Four Stages of Architecture
Maturity
• Business Silos architecture: where companies look to maximize
individual business unit needs of functional needs
• Standardized Technology architecture: providing IT
efficiencies through technology standardization and, in most cases,
increased centralization of technology management
• Optimized Core architecture: which provides company wide
data and process standardization as appropriate for the operating model
• Business Modularity architecture: where companies manage
and reuse loosely coupled IT-enabled business process components to
preserve global standards while enabling local differences
Enterprise Architecture as Strategy: Creating a Foundation for Business Execution (Hardcover)
by Jeanne W. Ross, Peter Weill, David C. Robertson 256 pages. Publication date: Jun 07, 2006, page 71
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© 2012 Tieto Corporation

17. II. Ecobank Enterprise Architecture
• Ecobank wanted to attain Business Modularity
• You cannot get there at once – “it is a journey”
• Business Silos means every affiliate making their own IT
decisions – this is expensive
• Ecobank firstly implemented Standardized Technology:
• IBM Servers, AIX, and Oracle
• More efficient both from a Procurement and Operational point of view
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© 2012 Tieto Corporation

18. II. Ecobank Enterprise Architecture
• Ecobank then proceeded with implementing Optimized Core
Architecture – in relation to cards: Tieto’s Card Suite,
FlexCube, and Postilion were used
• With this implementation Ecobank had attained Optimized
Core
• EcoBank is now beginning to enjoy the fruits of Business
Modularity
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© 2012 Tieto Corporation

19. II. Tieto’s Contribution to
Optimized Core
• On-line interfaces to FlexCube and Postillion
• Off-line interfaces to Flexcube, MasterCard, and Visa, and
from Postillion
• Affiliate net settlement and clearing
• Merchant Management including Merchant Settlement and
Merchant Service Charge calculation
• Fraud Detection and Prevention – Exceptional Fraud
Management
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© 2012 Tieto Corporation

20. II. Tieto’s Contribution to
Optimized Core
• Account Management for Pre Paid and Credit Cards
• including interest and other account fee calculations
• Account statementing
• Basic collection functionality
• Issuing Authorization including: VSDC, M/Chip, and CPA
• Card Life Cycle Management for Debit and Credit Cards
• Cards transaction (also on-line) and card commission
calculations
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© 2012 Tieto Corporation

21. III. IT engagement model
• It is important that Project goals are tightly aligned with
strategic goals
• Executive Reviews and Steering Meetings allow us to
ensure that the goals are correctly aligned
• Organizations needs to ensure Business Change
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© 2012 Tieto Corporation

22. III. Tieto Contribution to Capacity
Building
• Ecobank defined its business and marketing product
requirements
• Tieto provided business and technical consultations
• Initially, Tieto provided Application Service Management Tieto Employees lived on-site
• 7 Ecobank employees were ready for everyday operations
with Card Suite, an accounting expert has been trained for
Ecobank Operations
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© 2012 Tieto Corporation

23. Fruits of Unification
• 29 affiliates are using Card Suite
• Migrated from HP Unix to IBM AIX platform – also performed stress
tests – less expensive to manage a common platform
• Migrated 29 affiliates data
• Common business and IT practices mean greater capacity and
improved customer servicing
• Fraud Detection and Prevention – Exceptional Fraud Management
• Chip rollout – improved risk management
• In some African countries mandatory
• Reduced Fraud Losses
• PCI DSS Certification has been attained
• PCI DSS Certification was greatly aided because common and
business IT practices were introduced – improved Risk management
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© 2012 Tieto Corporation

24. Fruits of Unification – Instant Debit
Card Issuing
• Started in one Affiliate
• Took 2 weeks for a new customer to get a debit card –
Africa is big
• Business requirement was to reduce card delivery time
• Cards are made without cardholder’s name and with PIN mailer
• The affiliate has its own embosser – to write the cardholder name
• Web Service used to take information from FlexCube and update it
into Card Suite
• Cardholder can now get a personalized card in about 10 minutes
• Improved Customer servicing that allows for increase in customer
base
• This now can be rolled out to other affiliates because there
is a common enterprise architecture
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© 2012 Tieto Corporation

25. Lesson Learned
• Executive Support is Key
• For Large Projects Intensive Cooperation is Required
• Large Customers strive to implement Business Modularity
Architecture and Unification Operating Model
• It is in everybody’s interest to define appropriate functions to
appropriate systems
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© 2012 Tieto Corporation

26. © 2012 Tieto Corporation
Kims Šifers
Principal Business Consultant
Cards, Tieto Financial Services
kims.sifers@tieto.com