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Syam Pillai of Habib Bank AG Zurich.
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Internal research & development work is seen as inefficient, time
consuming, costly and even risky. According to conventional wisdom,
packaged solutions are the way forward, even if some companies find
themselves having to compromise on functionality or integrate a
third party application.
Habib Bank AG Zurich (HBZ), on the other hand, has stuck to its
internal development track, delivering solutions both internally to
its user base and externally to customers, and eventually reaching
a unique status of vendor independence. Currently, HBZ’s
backend consists of a large Sun Solaris machine that acts as the
Sybase database server, and a series of Red Hat Linux application
servers, delivering the group’s Java-based business
applications to the user community. “Many other banks have
multiple vendor dependencies… when they want to make changes
to their environments they have to be careful not to disrupt other
systems,” says Syam Pillai, vice president, information
technology, HBZ.
“This is one of the major differences here — by having
everything developed in Java we are not dependant on any
vendor… any machine can run the [core banking applications],
” Pillai explains.
Admittedly, the internal development
path isn’t necessarily the smoothest route. The bank spends a
‘substantial amount’ in R&D every year, as it evolves
its IT environment.
Currently, the 15-man IT team is split roughly into two sections
— one half continues the Java development, while the other
takes that development work, integrates it into the current
application framework and maintains the environment.
Regardless of the resources thrown into the bank’s R&D work
not all of the investment results in workable solutions. “
It’s the price you have to pay to maintain the
environment… we have to invest in research or we won’t
be able to evolve,” says Pillai. “R&D is
continuous… [we] have to spend a lot of money and conduct a lot
of experiments.”
However, whatever the bank invests in evolving its IT environment,
it is able to regain through its adherence to open source software.
Most recently, the bank began a project to deploy Linux to the desktop
for its 400 users in the UAE. By the end of 2001, the corporate bank
had migrated approximately 300 users to the open source operating
system.
Although HBZ intends to migrate the rest of the users to Linux in the
coming months there is no firm timetable to do so, due to the limited
nature of IT resources available to conduct the migration.
The bank’s plan to migrate its user community to Linux is aided
by the limited use of Microsoft software. Pillai estimates that
approximately 10% of the user community are actually using Microsoft
technology. The rest of the users just accesses HBZ’s Java-based
core banking applications, via thin client machines.
“We’re just replacing Windows on the client machines with
Linux… There is no change in the application — that remains
the same. Very few of [the users] are using other applications, such as
spreadsheets. For that purpose users run either Sun Office or K-Office,
which is part of the Linux distribution,” says Pillai.
HBZ’s Dubai-based IT-shop is already investigating the possibility
of rolling out Linux to the other eight countries that it’s
responsible for. However, the work to convert users will depend on how
quickly they can be convinced to give up their Windows applications.
The extensive use of Linux, initially at the server level and now
increasingly at the client level, has helped HBZ to significantly reduce
its hardware expenditure. Until last year, the corporate bank was still
using 286 machines to access its core banking applications. The antique
boxes where only replaced when Windows demanded more powerful machines.
The same fat Intel machines are now using Linux, which says Pillai,
delivers enhanced performance. “We have found that Java under
Linux runs better than Java under Windows,” he says.
Core to Habib Bank’s whole platform independent ethos has been the
extensive Java development that has been ongoing since 1996. Since that
time the bank has developed a massive 18-module suite of banking
applications — internally described as the banking enterprise.
From the outset the bank realised the ‘freedom’ that Java
could offer them.
“We saw a language that was going to be supported by the industry.
We saw the capability that Java gave us to accelerate development time
and help simplify the architecture,” comments Pillai.
With the accelerated development time provided by Java, the bank shrugs
off suggestions that internal development is both time consuming and
expensive. In October 2000 Habib Bank delivered Internet, SMS and WAP
banking. More recently, HBZ became the first bank to offer online letters
of credit. According to Pillai, the timely delivery of such services
proves that the in-house development track works and that the application
infrastructure is both flexible and scalable.
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