In the wake of its recent reorganization of its software division for distinct market sectors, IBM
is rolling out five new
middleware packages designed specifically for the crucial financial
IBM officials said the new packages, which include 15 modules in all,
are designed to help customers in financial markets, banking and insurance
industry integrate, manage and automate the business processes — and
attack IT problems — that are unique to that industry.
Doug Brown, director of industry marketing for IBM’s software group,
said many financial industry players are faced with a new set of
compliance deadlines under the federal Sarbanes-Oxley reporting
regulations this year. So the idea is to help banking and
financial vertical customers “turn compliance from a necessary evil into a
business advantage,” he said.
For example, Brown said, IBM’s new Risk and Compliance middleware
package provides customers with infrastructure that helps manage regulated
processes such as internal controls, data retention, financial publishing
and operational risk management. Other packages include Front Office
Insight, Trade and Order Management, Financial Information Interchange
and Post-Execution Integration.
The wholesale payments line helps customers centralize and manage
repeatable payments processing by consolidating access to external
financial networks such as the international payments system known as
SWIFT. One key aspect of the messaging system offered by IBM helps
customers eliminate duplication of the process as well as monitor
potential points of failure.
In the retail banking sector, Brown said the offerings include IBM’s “Branch Transformation Solution,” which helps far flung bank branches streamline how they interact with customer data, while at the same time helping them to migrate from outdated and difficult to manage branch IT systems.
For an industry that still recruits many programmers for the COBOL programming language that drives its legacy systems, the banking sector offerings arrive amid
a wave of consolidation among big banks. For many banking operations,
integrating new applications with legacy systems, such as different data silos that can’t interact with other silos in other branches or locations, continues to be a top issue on their IT agendas.
Perhaps the boldest packages among the 15 specific modules are the ones
geared for the insurance industry, widely considered one of the slowest
and most cautious sector to upgrade its IT architecture — within a
financial services sector that historically pursues a “fast follower”
policy of upgrading to the latest information technology techniques as a
form of risk management.
Brown said the insurance packages include five new modules such as
integrated claims management, integrated underwriting, policy management,
channel distribution integration and insurance customer insight.
For example, the channel distribution integration package for the
insurance industry consists of IBM’s WebSphere Business Integration,
WebSphere Portal and Tivoli products. Brown said it was complemented with
industry-specific middleware capabilities provided by the WebSphere
Integration ACORD adapter and the Financial Services Portal Workbench
“I think there are insurance companies that are willing to make
investments that will reduce their cost structure,” Brown said. “They’re
not going to touch their application software, we recognize that.” And
they may not be interested in adding new application servers in their
online systems, he continued. “But they might very well be very interested
in integrating their processes in a much more efficient way in order to
drive their costs down, such as servicing claims faster.”
The sales staff is also focusing on opportunities to help insurance
customers reduce the length of time involved in the underwriting process,
or processing claims in a more timely manner in order to reduce the cost
But Brown said the five new financial services middleware packages,
including 15 modules in all, represent a different kind of upsell
opportunity to Big Blue’s installed base in the financial services
IBM’s WebSphere lines already have a very large presence in the banking
industry. The idea now is to offer customers ways to extend and expand the
features and functions where they have already invested, he added.
The new software packages, announced Monday, are supported by
freshly-trained sales and services support teams as well as
industry-specific applications built by independent software vendors