Gref is horrified: IT centralization does not allow Sberbank to catch up with the IT companies

The Centralization 2.0 program of Sberbank for transfer of all territorial banks on the uniform IT platform started in 2011 and was complete in the summer of 2015. Its purposes were: reduction of terms of an output to the market of banking products, creation of qualitatively new conditions for further centralization and unification of operating rooms and business functions, cost reduction of Sberbank on IT.

German Gref's Assessment: As soon as we constructed our super data-center, we came to a conclusion that we are absolutely noncompetitive

On January 15, 2016 the president of Sberbank German Gref declared the disappointment with project deliverables "Centralization 2.0" within which the credit institution created the single centralized IT platform. It is going to be changed completely.

It was the largest and  fast project of centralization of IT infrastructure in  the world. But  as soon as we constructed our super data-center, all finished, we came to  a conclusion that  we are absolutely noncompetitive. It was the awful output for  me personally, it was the blow. We run with great strides, but  we see that   we are not in time  — Gref  on  the Gaidar forum (the quote by RBC) said during the speech.

German Gref is disappointed with results of the unprecedented IT project of Sberbank

He reported that he considers by competitors not other Russian banks, but the international IT companies which are selecting at Sberbank "most sweet piece of pie". German Gref emphasized that Sberbank lags behind them on update rate of IT systems. The bank made about 40 thousand changes in 2015 while Amazon does 10 thousand changes of the system a day to the, the banker noted.

The head of the bank, largest in Russia, also told about plans for cardinal conversions of the platform.

All processes should be rebuilt. We need to turn ourselves inside out, we  are not ready to  it at all. We need the flexible platform,  not such huge as  today. If we change any part of the platform now, we need to test two-three months, unclear where  and that  will get out  at the same time, is accident  — Gref told, having added that the new platform will be founded on an open code system using cloud computing, artificial intelligence and machine learning.

German Gref also told that Sberbank takes shares of the Russian-American company which won the tender against such IT giant as Oracle and IBM, and "it appeared 10 times more these largest companies".

As the first deputy chairman of board of Sberbank Lev Hasis specified RBC, it is about GridGain. According to data of the official portal of state procurements,  at the end of December, 2015 Sberbank paid $ 5.6 million for this company^[1]

Results of the program of centralization

Uniform IT platform

To program implementation in each macroregion the set of the main bank platforms from different developers was used, billing systems alone there were seven pieces. Within "Centralization 2.0" in Sberbank was created the centralized IT platform: "zoo" of automated systems of territorial banks was replaced with a number of the unified systems.

Within the project, in particular, the following systems were created:

• Automated system "Branch Sberbank" (AS of FS). In it more than 80 thousand users in all territorial banks of Sberbank work.

• Single corporate system (EKS). At the time of program termination it contains these 2 million accounts of legal entities, 400 thousand loan agreements of clients legal persons, 250 loan agreements of microbusiness. In day in a system about 7 million settlement documents on accounts of legal entities are processed.

• Uniform loan portfolio of private clients. The given more than 60 million agreements from which 15 million agreements – acting are stored in it. Using a system about 80 thousand issues on the credits in day and 600 thousand repayments on the credits in day are carried out.

• Uniform center of processing of deposits of individuals (AS of eTsOD). Contains these 630 million accounts from which 425 million accounts are acting. Through a system about 290 million account transactions daily are performed.

• Uniform payment service (AS of EPS) for implementation of billing payments. Interacts about more than 100 thousand suppliers of different services (municipal services, kindergartens, the energy companies, etc.) concerning which there are about 6 million payments a day.

• The uniform cash center (eKTs) which about 400 cash centers of Sberbank for the whole country use.

All systems are based in uniform DPC Southern port. Branches of Sberbank work with them through the thin client.

In addition to centralization of IT infrastructure of territorial banks "Sberbank" also standardized and unified business processes.

The chief architect of IT of Sberbank Andrey Hlyzov notes that the program was implemented in very short time

Program scales

The program of centralization in Sberbank is called unprecedented on the scale. According to the vice president, the chief architect of IT of Sberbank Andrey Hlyzov, in her framework more than 700 large implementations were performed.

Creation of the centralized IT platform was conducted by forces "Sberbank-Technologies", and in total more than 32 thousand were involved in program implementation human.

As for financing, in one of issues of the newspaper for employees "Sberbank-Technologies" – SBT of Vision Andrey Hlyzov reported that the budget of the program makes more than one billion dollars.

The program reached the final of the tender IPMA International Project Excellence Award 2015 in the Mega-Sized Projects nominations (mega-large projects) which results will be summed up at the end of September.

Andrey Hlyzov emphasizes that at such scales the program was executed rapidly: the project was complete in four years while on average development and deployment of similar programs in the world takes 10-12 years.

Effects of the program

Provide data in Sberbank that the Centralization 2.0 program became cost-efficient and profitable from second year of implementation

As one of the most important results of centralization in Sberbank call acceleration of an output of new products to the market: if before their circulation on average took week, in many cases now — one day.

Speaking about economic effect "Centralization 2.0" provide data in bank that the net discounted income (Net Present Value, NPV) programs was about 8 billion rubles. It managed to be reached at the expense of cost optimization at implementation of the main business processes and cost reductions on IT. At the same time economic effect almost twice exceeded planned: initially in Sberbank expected to receive 4.6 billion rubles.

Reduction of time of technology idle time of IT systems in Sberbank became important result also. During program implementation the technology of online data migration without interruption of services of bank and flexible load control on a system was developed.

As a result of centralization also performance of IT systems of bank significantly increased, note in Sberbank. For horizontal scaling of data processing the Oracle RAC technology which allowed to distribute data processing of territorial banks on several nodes based on three high-end of the IBM Power 795 systems was implemented.

Difficulties of the project

Transfer of territorial banks on a single platform was not smooth. The unavailability of the megadPC to "filling" of systems and limitation of the areas became one of problems on the course of program implementation. Andrey Hlyzov told about it in the corporate edition for the staff of SberTech – SBT of Vision. There were also problems at the programming layer: for example, during creation centralized IASC (the integrated automated system of crediting) of natural persons on the Oracle platform.

The error in software of IBM of 9 months braked the program of Sberbank

In September, 2015 Andrey Hlyzov told TAdviser that at implementation of EKS (a single corporate system) of Sberbank the hard error in IBM AIX OS used in the project because of which rates of program implementation slowed down was revealed.

Implementation of EKS began in 2011. As the computing platform for it the new powerful IBM p795 servers were selected. This model of the server was produced at the end of 2010 and not "rolled" on projects of Sberbank of scale, comparable to the project, yet.

The error in software has an effect at increase in load of the machine on SMT4 mode (a SMT - simultaneous multithreading, SMT4 - a 4-line SMT on a core). For EKS it was going to use three machines IBM p795. At first, at the end of 2011, SMT4 mode was started only on one of them, and at the same time a system normally worked, Hlyzov tells. At that time three banks - the West Ural, West Siberian and Siberian banks were connected to a system. However after connected one more bank to the machine – Ural, serious problems began: a system began to fall, and as it became clear – to fall at the level of OS.

"Actually we faced an undocumented error at the level of the AIX operating system. Finally we resolved this problem only approximately in nine months, - the chief architect of IT of Sberbank tells.

According to him as it was the nuclear problem of OS, decided it jointly with specialists of IBM, American including and also with specialists of Oracle and Symantec by whose software it is also involved in a system, and specialists of bank. Against the background of it it was even created special regulated under - the organization in bank – CritSit (abbr. from critical situation) - on which the problems connected with external vendors and which sorts them at the level of lead engineers of Sberbank are taken out.

According to Andrey Hlyzov, in bank there was a confidence that it will be possible to win against a problem, however this story braked rates of program implementation of centralization: "We removed SMT4 mode, and the situation was stabilized then within nearly nine months we any more added nobody to a system".

After the problem at the level of OS was solved and the bank delivered all updates, including updates of Oracle, Symantec and the application software, SMT4 mode was included again and connection of banks to a system continued, Hlyzov told.

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