CACEIS, THE BANKING GROUP OF CRÉDIT AGRICOLE (FRANCE), DECIDED TO CONSOLIDATE ALL ITS INFORMATION TECHNOLOGY (IT) PRODUCTION AT CSC IN LUXEMBOURG. A SINGLE INFORMATION SYSTEM, A SINGLE SERVICE PROVIDER! EVEN THOUGH THE CONTRACT REGARDS THE MANAGEMENT OF INFORMATION TECHNOLOGY PRODUCTION INFRASTRUCTURE, IT SPECIFICALLY STIPULATES THAT CSC MUST CONSOLIDATE AND TRANSFORM THE ENTIRETY OF THE CACEIS IT PRODUCTION INFRASTRUCTURE IN THE VARIOUS COUNTRIES IN WHICH IT IS ACTIVE. AN ENORMOUS PROJECT.
Merge, integrate, transform. CSC has already carried out the exercise over a dozen times for the CACEIS group, which is specialized in providing financial services to institutional investors, fund management companies and large corporations.
The most recent project was the acquisition of the activities of HSBC Securities France (custodial services and valuation/accounting management for UCITS). Several months before that, it was Olympia Capital International. This acquisition enabled CACEIS to extend its geographic coverage to North America, reinforcing its service offering for alternative products for its international clientele. “Things move quickly,” confirms Christophe Pierron, CIO of CACEIS Luxembourg. “Crisis or not, we continue to grow. And we chose an IT partner that is not only experienced in our core business, but also able to provide us with guidance.
For HSBC France, for example, we decided together with CSC not to take over the IT infrastructure. The integration was completed in less than six months.” The story of CACEIS goes back to 2005, initially to the combining of the securities operations of the Crédit Agricole and Caisse d’Epargne groups. Five years later, the group – 85% of which is today held by Crédit Agricole, and the balance by Natixis – is present in 11 countries. All its IT systems are consolidated and outsourced to CSC in Luxembourg, which holds the offi cial status of Financial Sector Professional.
A FUNDAMENTAL CHANGE
Until now, CACEIS effectively functioned via three GIEs (Groupements d’intérêt économique – a consortium of related businesses which formally pool their efforts for competitive advantage) and an internal production department. “Consolidation was a major step in the transformation of our business model,” comments Christophe Pierron. “We have four primary objectives: reduce operational costs by industrializing, standardizing, and realizing synergies; reduce the level of operational risk; simplify and homogenize management processes; and finally, improve the quality of service.” CACEIS fi rst signed an agreement with CSC in June 2007 – for seven years. The contract relates to the management of the production infrastructure. The contract stipulates that the supplier must consolidate and transform the entirety of the IT production infrastructure of CACEIS in Europe, by putting in place an optimized operating environment. Using its proven methodologies and processes, CSC will be responsible for the operating and monitoring of the information system, the design of the architecture and support of all technical platforms – major systems (mainframes) and mid-range machines (open) – as well as the corresponding hardware maintenance. Basically, a migration project in which major operational and financial outcomes are at stake. The first decision – and one of the most important – was to adopt an approach by type of activity, given that the majority of clients are provided with specific services which they also wish to have when using the new platform.
The project required the coordination of three internal aspects: commercial (customer relationships and services), operational (organization and processes) and information systems (reduction of functional differences). An additional element of complexity for CSC was to build a close relationship with the client, and to persuade and guide the client from beginning to end, while respecting the need for a commercial dialogue but also the requirement of meeting very tight deadlines. The process thus consisted of working very closely with each entity to evaluate its specific situation and needs. Workshops then made it possible to develop, explain and jointly validate the goals and roadmap for the project. Lastly, the migration process was set in motion with a phase of preparatory work in order to receive clients in the target environment. The migrations were carried out at a rapid pace: roughly one every two months! “Today most of the migrations have been completed,” explains Christophe Pierron. “Now that the transformation is behind us, we’re focusing more on an approach based on continuous improvement. Recently an audit by Crédit Agricole confirmed the soundness of our choices, even though outsourcing is not really part of the natural corporate culture of our main shareholder!” As for the choice of Luxembourg, it was not without significance. As the leading fund management services provider in Europe, CACEIS chose to install its information systems in Europe’s leading investment fund market. Christophe Pierron states: “We are in the habit of operating where the expertise is greatest; the United States for alternative funds, ‘agent transfer’ in Luxembourg, custodial and depository services in France. As for our suppliers, we select them on the basis of the same criteria: CSC’s expertise was the first criteria, its international position the second.”
Present in Luxembourg since 1986, essentially to serve DuPont de Nemours, CSC created CSC PSF Luxembourg in 2007 initially to lead the CACEIS project; today other major projects are underway. From less than 40 people in 2007, staff levels have grown to almost 100 now. As for the infrastructure of CACEIS, it is hosted in two Tier IV data centres, one of which is the European Data Hub managed by CSC. “Now we can grow without worrying about IT,” asserts Christophe Pierron. “Our operational costs were significantly reduced and our processes optimized. More important however is knowing that we have given ourselves the means to respond to the new challenges facing the financial services sector with an increased quality of service. Today, we are clearly on the lookout for new opportunities.”