MOORPARK, Calif. – In the intensely competitive credit uniondata processing space, any new credit union client is exciting forprocessors, but some wins are sweeter than others. For XP Systems,it doesn't get much sweeter than the signing of the $3 billionDigital Federal Credit Union, Marlborough, Mass. DCU is one of thenation's most tech-savvy credit unions and typically experiencesabove average growth each year. “It's new ground for us becauseit's the first time we entered into a co-development agreement witha client. We haven't defined yet what that will be, but they aregoing to be working on some projects with us. That's exciting – tohave someone who is high-tech and on the leading edge developingwith us,” said XP Systems President John Edwards. As part of thedeal, DCU's highly-skilled information systems staff will be freedup to work more on developing ancillary products for the XP core.DCU is currently on a re:Member Data system, which was acquired byOpen Solutions Inc. For the last seven years, DCU's IT staff hasn'tused any of re:Member Data's core system upgrades – it has madesystem changes on its own, quite unique in today's environment. “Weuse a lot of resources today just to maintain RDS with compliance,regulatory, tax changes, and other areas. Clearly this will enhanceour ability to become even more innovative,” said DCU VicePresident of Technology Kris VanBeek. VanBeek is excited about whatthis will mean on the programming side. Currently DCU is splitbetween core and non-core programmers. Core programmers are morelegacy oriented and program in proprietary languages or Pascal. Itsnon-core programmers are .Net and Java. “As part of the partnershipand the new XP2 system we will not have to segregate the groups asthey are today. We will be able to allocate resources between coreand non-core based on business priorities. We will have a uniformmodern programming team and at times be an extension of the XPteams. It will be a refreshing change and allow DCU to execute evenfaster,” said VanBeek. VanBeek has been with DCU for about twoyears. He said about a week after he was hired, OSI acquiredre:Member Data and the CU's management decided to look atconverting systems. “It wasn't exactly what I wanted to do havingjust been hired,” VanBeek joked. DCU went through a year and a halfof “soul searching” as VanBeek put it before deciding on XP. Hecited XP's rock solid database system, XP's coming XML-based APIinterface that will allow DCU's IT staff to develop its ownapplications, as key tech reasons for the selection. “We do apretty good job as far as automating interfaces. What they'll allowus to do is custom development using message sets within thesystem,” said VanBeek. He said DCU is hoping to further leverageits current development work. “We have developed a variety ofsystems internally and within our software subsidiary CUSOFiVision. Our plan is to leverage these projects with XP so theycan adopt them and potentially offer them to their full CU customerbase,” said VanBeek. Some of the systems include collections,ticketing, CRM and sales. Symitar is one popular system that hasspurred a number of tech-savvy CUs to form CUSOs that develop appsoff of the Symitar system. Is that what's happening with DCU?Edwards said he's not sure how it will shake out. “It's possible.We're planning a meeting within the next six weeks with a group ofcredit unions to put some structure around things. The mostchallenging part is making sure all standards are adhered to aspeople develop new features and functions.” Speaking of tightintegration, DCU also may utilize XP's Visanet solution, whichallows it to connect directly to Visa. “It's not for everybody. Youneed a large card base to do it, but when you eliminate thepass-through processor, the return on investment is clearly there,”said Edwards. VanBeek said DCU is still considering Visanet, but itdoes plan on using Intercept, XP's ATM driving solution. “It hasbeen around a long time, but has been rewritten, migrated to a newversion,” said VanBeek. DCU's decision did not come from up high,it was driven by the everyday users of the systems, includingtellers, loan officers, member service reps, etc. VanBeek said itwas these in-the-trenches users who vetted all the systemcandidates, and eventually landed on XP. Senior management ofcourse had a say, but DCU wanted its heavy users to be comfortablewith it. A team of about 25 reviewed the systems. “Originally wewere looking at larger banking systems because we're a largecomplex credit union. But our people didn't care for the workflow,and had some concerns about how it would fit in. Because of thatfeedback we went with a much more traditional credit union system,”said VanBeek. VanBeek said he personally was impressed with XP'sdecision to completely rewrite its old Focus XP system, which hasresulted in XP2. He said that showed guts and confidence in theirtechnology. XP2 uses an IBM DB2 database, browser-basedapplications and .NET technology. “That rewrite made a real boldstatement. That's something I could see DCU doing.” Pricing didcome into the decision, but VanBeek said all the candidates werewithin 20% of each other, so it wasn't a major factor. “It reallycame down to what is going to be best five to 10 years out. It'snot about just picking a system today.” But DCU is looking forcommercial functionality, something XP2 doesn't have. DCU is one ofthe ground floor XP clients participating in XP's ComCoreinitiative, which is focused on bringing commercial bankingfunctionality within XP2. DCU and about a dozen other CUs have evenprovided funding for this effort. “It's a group of clients who haveconcluded that they would rather have business services capabilityembedded in the core, rather than interfacing with an ITI or CBS[two Fiserv products]. What they are doing is really prepaying forthe software. We have a marketing agreement with them based on whatwe anticipate in future business from it,” said Edwards. This meansthe involved XP clients could even share in revenue from CommCorewith XP, a true partnership arrangement that VanBeek said isindicative of the XP culture. “It's hard to put into words really,but the whole culture thing was huge. XP's credit union philosophy,support of charities, casual atmosphere and their willingness totalk about things like co-development were all major factors thathelped us feel more comfortable. Some other vendors were hard andfast,” said VanBeek. VanBeek used to work for Fiserv's ITI group,and said he knows all the good and bad about Fiserv, but in the endthe good wins out. “Let's face it, it's almost like the old IBMadage. There's a little bit of a confidence factor in theirfinancial power and their reputation,” he [email protected]