In 2008, Wells Fargo embarked on the largest acquisition in banking history when it announced plans to snap up Wachovia. Thus began a 3-year effort to integrate the technology infrastructure used by the two giants.
At the Gartner Data Center Conference in Las Vegas today, Scott Dillon, EVP and Head of Technology Infrastructure Services for Wells Fargo, answered questions from Gartner managing VP Ray Paquet about the keys to success in integrating the two giants and safeguarding the $1.2 trillion in assets the combined company now has.
First, Dillon was clear that culture played a big role in the merger; that is, being respectful of each company’s culture and not trying to impart one on the other. Toward that end, when it came to which legacy infrastructure to use, the company made a conscious decision to split it up 50/50. Decisions were made according to what was best for each business unit, and always with what’s best for the customer in mind (a point he made many times). Wachovia, for example, had a larger brokerage business than did Wells Fargo, so it made sense to go with Wachovia’s infrastructure for that unit.
Communication was also a focal point, both within the organization and with customers. Wells Fargo migrated on a state-by-state basis, beginning with Colorado, which it deemed a good test case because Wells Fargo had a large footprint there and Wachovia’s was relatively small. That allowed Wells Fargo to gauge customer reaction “under a microscope” and adjust processes accordingly. In some instances, customers were alerted three years before the switch took place, such as if a customer had a brokerage account with Wells Fargo that would be switched to a Wachovia system but their retail bank was in a state that wasn’t slated to switch until late in the 3-year cycle.
What was truly stunning was the effort IT folks put in. Many of them had to work weekends frequently for three years. To keep them engaged, business heads would go out of their way to show appreciation, through simple thank you notes and the like. Any conflicts were dealt with head-on. And as opposed to the exit interviews that HR frequently conducts when an employee leaves, Wells Fargo performs “stay interviews,” to let employees know how valuable and appreciated they are and to ask how they’re doing. The strategy worked, according to results of employee surveys that found solid improvement in the level of IT employee engagement with their jobs– even after all those working weekends, Dillon said.
Performing the migration gradually over the 3 years also enabled Wells Fargo to put in infrastructure and process standards in place – either chosen from one of the legacy organizations or developed fresh if necessary – that everyone worked toward, with the ultimate goal being “cloud-like” computing. That meant if systems for a particular business unit or application were ripe for refresh, they would be replaced with the new standard infrastructure. Gradually, that will put all IT units on the same page.
But Dillon was clear that the company was willing to take the time to do it right. That makes sense when you consider the size of his infrastructure, with some 50,000+ servers and that they deal with 10,000 changes every month. When you’re dealing with numbers like that, it’s best not to rush things.
9 years ago
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