Software Testing Strategy: In Conversion of Complex Financial Systems

Software Testing Strategy: In Conversion of Complex Financial Systems

Fatma Molu (R&D Department, Kuwait Turkish Participation Bank, Kocaeli, Turkey)
Copyright: © 2014 |Pages: 14
DOI: 10.4018/ijesma.2014040103
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Abstract

Complex financial conversion projects with large budgets have many different challenges. For companies that want to survive in conditions of tough competition, legacy (old) systems must continue to provide the required service throughout the project life cycle and in some circumstances even after project completion partly. In this case, the term coexistence comes into prominence. During this period, testing phase takes more critical role while integration systems' complexity and risk amount increase. Determining testing approach to use is essential to make sure both transformed and legacy systems provide service synchronously. In this paper, testing practices applied in the long conversion processes are discussed. Primarily, the basic features of the critical financial systems are addressed and then the main adoption methods in the literature are summarized. Then a variety of testing methodologies are presented depending on those adoption methods. These samples based on real-life experiences of transformation project. The most extensive example of real-time online financial systems is core banking systems. This paper covers the testing life cycle process of the large scale project of core banking system transformation project of a bank in Turkey.
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2. Reasons Of Conversion

Managing financial systems requires to act quickly and decisively to improve the efficiency and effectiveness of the finance functions. The aim is to align the finance function with the company’s strategy to manage through the expected recovery by creating a more flexible, cost efficient finance organization. Many finance organizations are comprised of inefficient, manually intensive processes, disparate systems and data structures that are not integrated. These organizations need to renew their systems and perform conversion process (Limberg, 2013).

In financial industry, the main reasons for conversion of the systems are developing technology, flexibility to meet the new requirements and survive in the market. Moreover performance and scalability issues and maintenance cost are also crucial reasons of transformation.

A survey done in USA shows the numbers of the firms changed their banking infrastructures. The Figure 1 indicated that only in this country in three years about 1100 banks transformed their infrastructure (Crossman, 2011).

Figure 1.

The number of firms in the USA changed the banking infrastructure (Adapted from Aite Group)

Although there are several crucial reasons for conversion of financial system, there is high risk in this operation, especially in large size companies. To transform core banking system is like open heart surgery for banks (Shimeall, 2002). To minimize the risk testing strategy should be define clearly and it should align with business strategy and objectives.

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