In a venture that will further strengthen the relationship between Absa and the AST Group, the companies have embarked on a R300 million joint project which will allow Absa to improve its cost-to-income ratio without sacrificing service delivery to its customers, and which will place it as a leading bank in the connected world of e-business. The project will be rolled out over a period of 30 months.
Absa is already the leader in electronic banking business, through its Free Internet Access (FIA), Self-Service Banking, telephone banking and mobile banking market position. The proposed solution will improve the co-ordination, collaboration and consistency between all of the customer delivery channels which will ensure a more integrated customer service delivery platform.
The project, called Project e-Preparation, involves the conversion from DOS/OS2 platforms to a comprehensive NT related platform. This includes replacing 18 000 workstations and other non-NT compliant equipment, e-preparing 37 000 network points at 1 050 sites throughout the country, implementing a new Absa delivery system with e-enabling technology and network equipment. A prior press announcement referred to Absa`s choice of IBM PC technology for workstation replacement. In addition, AST will implement a network knowledge management system to further enhance the management of the distributed technology assets.
"The financial services industry is evolving rapidly, presenting institutions with a vast array of new products and technology options for servicing customers, while improving processes for efficiency and effectiveness," explains Louis von Zeuner, Group Executive Director for Absa. "The joint project will allow Absa to take the new technology and exploit it, ensuring that the bank will offer a comprehensive service for customers in a connected society."
Absa understood that IP-enablement of the organisation would ensure that the key issue of cost reduction would be addressed, and the required business benefits would be achieved. "Convergence to a common IP network will result in a reduction in the infrastructure necessary and also offer the flexibility to add capacity incrementally, when and where required," adds Von Zeuner. "Moreover, in order to increase efficiency and reduce complexity, Absa Direct, Internet Banking and the branches will share the capacity of the infrastructure simultaneously."
The integrated services approach will result in flexibility in branch delivery, allowing Absa to reduce the cost of ownership and positioning the bank for greater business agility. In addition, the cohesive solution will allow Absa to react more speedily to customers` needs, to react more effectively to market changes, to reduce operating costs significantly and to increase co-operation with key customers.
"The advantage of business agility and customer collaboration cannot be quantified, but suffice it to say that it represents competitive advantage," comments Von Zeuner.
"This joint venture is further evidence of AST`s excellent relationship with Absa and the success we have already achieved with AST Distributed Technology Services (DTS), our joint venture with Absa," notes Pieter Bouwer, Executive Director of the AST Group.
The project will be implemented and managed by AST DTS. As a result of the joint venture with Absa for the outsourcing of distributed technology, AST DTS already has an intimate knowledge of the Absa branch infrastructure and environment.
Since its establishment in April 2000, AST DTS has had a number of successes in the market, adding new accounts such as Logical Options, Nissan, Investec, Capitec Bank and Government Employees Pension Fund. The physical devices under their management has increased from 75 000 to over 200 000. In addition, AST DTS has won a lucrative roll-out project for the Department of Justice.
This new Absa contract enables AST DTS to gain further economies of scale from its extensive national infrastructure and best practices, entrenching it as the leader in the distributed technology environment in SA.
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In just three years the AST Group has established itself as one of the leading information and communication technology companies on the JSE Securities Exchange. Its consistent creation of value for shareholders, clients and employees has resulted in a steady increase in monthly revenue to the R100 million plus mark.
AST is now the fourth largest South African IT company by market capitalisation, and is one of the top three in terms of physical infrastructure (mainframes, servers, desktops, and networks under management) and geographical footprint with over 62 physical locations. Counting almost 90% of the top 100 JSE-listed companies among its clients, the AST Group services mostly large corporate and government clients, but is increasingly offering services to rapidly evolving small and medium enterprises.
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