Embrace Details?and Test Like Mad

The integration of two banks’ IT systems and the mapping and transferring of the acquired bank’s customer data is a painstaking, tedious task. "There are literally thousands and thousands of pieces of data that need to be looked at and touched and evaluated to understand how to merge those systems together," says Dennis Rygwalski, former CIO of FleetBoston and now general manager of financial solutions at Exigen. That means going through each field in each database and figuring out, for example, what the "average account balance" means on each system.

Experienced acquirers have got the integration process down to a science and thoroughly documented. "We have done enough mergers, so we have a pretty good sense of where problems might occur and a well-planned data-mapping process," says Wray at Citizens. Citizens and Southwest Bank of Texas conduct operational reviews at the end of each merger to look for improvements to the merger process. After a merger in which the volume of customer calls and website visits to check account balances reached the upper range of what had been expected in the first few weeks, the operational review unearthed the idea of tapping into Southwest Bank’s disaster recovery facility. By putting that facility into production mode for the first few weeks after a conversion, the bank could avoid paying for extra bandwidth to handle predictable spikes in volume.

Some banks, however, used to skip integration testing. The prevailing mentality on conversion teams, says Tubin, was "f**k it up and fix it fast." Teams used to just go live with conversions and have knowledgeable staff ready to fix problems as soon as they surfaced.

Now that technology has gotten more complicated and banks are striving for no merger-related customer attrition, experts recommend testing each application as well as how individual applications talk to each other. It’s also important to run mock conversions before going live. "We knew from bad experience that if we didn’t adequately test, our customers would test for us, and our customers would be telling us what was wrong," says Wachovia’s Davis. For example, in a previous merger, customers complained that loan payments weren’t getting applied to their accounts because a bug in the cross-reference system prevented the system attempting to apply the payment from accessing the customer’s newly assigned account number. For the Wachovia and First Union merger, Davis’s team conducted six months of testing, running three mock conversions for each of the four deposit system conversions. Through such rigorous testing, they found literally hundreds of errors?and corrected them before they could affect customers.