Washington Mutual

By Baselinemag  |  Posted 2006-10-15 Print this article Print

Chesapeake Energy, Ruby Tuesday and others explain why they made the rankings.


Washington Mutual: Integration Is Non-Negotiable Headquarters: Seattle, WA
2005 revenue: $21.3 billion
2005 net income: $3.4 billion

Integration of large computing systems is a challenge for any company going through a merger, but few sectors have earned as bad a reputation for getting the job done as banking.

In fact, nothing gets a consumer more fired up than talking about the hoops they have to jump through to perform the simplest transactions following a merger, like cashing a check at an out-of-state branch of their "new and improved" bank.

Washington Mutual may be one of the few exceptions.

Since 1983, it's acquired more than 35 banks and mortgage houses to become one of the nation's largest retail banks, with $351 billion in assets. In most cases, the bank integrates the people, processes and systems associated with each merger within nine months.

The key to success is simple, says chief information officer Debora Horvath: Integration is non-negotiable at WaMu.

"Everyone knows, from due diligence on, that the plan for integration is to move over their corporate systems [to WaMu's systems] as quickly as possible," she says.

That occurs even if the acquired bank's systems are considered to be best of breed. WaMu's core systems include Oracle's PeopleSoft Human Capital Management for its human-resources and payroll operations, the Hogan Integrated Deposit System from Computer Sciences Corp. for deposits, and Fidelity National Information Services' Mortgage Servicing Package for originating and processing loans.

Consider the speed with which it moved on its $1 billion takeover of Irvine, Calif.-based Commercial Capital Bancorp (CCBI). The deal to acquire CCBI and its 32 locations was announced this April and officially closed on Oct. 1. However, in late September, even before the official close, Horvath's department converted CCBI to WaMu's PeopleSoft system.

"We view HR as a priority," she says. "It's one of those systems that can get management all on the same page, and get employees acting like one company."

Washington Mutual has consistently appeared on the Baseline 500 list, and that, too, is a factor of its overall tech strategy.

Horvath says the company employs a standardized approach to evaluating and prioritizing technology projects, based on a methodology it developed internally called Atlas.

The name is derived from the concept of having a collection of "maps," or guides to execute projects. It is achieved over four phases—Initiate, Plan, Execute and Close—with gateways at each phase to scrutinize progress. At the initiate gateway, for example, a high-level business case is presented to executives to determine if the expected return on investment and strategic alignment warrant continuation of the project. Executives can then compare all projects and choose those with the greatest expected returns.

Once a project is completed, WaMu reviews whether the benefits and value associated with a project were obtained as expected, and lessons are harvested from the project.

An example is a product cross-selling system installed in retail branches about a year ago from Infor Global Solutions of Atlanta. Infor's Epiphany customer relationship management technology allows WaMu tellers to take advantage of real-time personalization. When a customer's account information is entered into the system, the software identifies the customer and other products he might qualify for, such as a line of credit. A green button appears on the teller's screen with a suggestion for the customer, such as, why not establish a line of credit?

Horvath declined to disclose the technology's return on investment, but says, "The success rate has been tremendous." By Mel Duvall

American States Water: Liquid Assets


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