Blog: Managing mortgage transformation


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Garry Sukhija, Director at Retail Banking Consultancy

Lenders must constantly adapt and evolve their proposition to compete in today’s rapidly changing market. However, projects to support this often have flaws – incurring considerable financial outlay and failing to return on investment.

As lenders continue to implement technological solutions to overcome business challenges, it’s critical to consider business process re-engineering, an unbiased RFP process and the long-term cost of customising systems.

Wider business problem analysis

While the overall mortgage journey follows a logical process from enquiry to disbursement, each lender’s business processes, underwriting criteria, and proposition is unique. So, before embarking upon any technology transformation, it’s vital to have a deep understanding of the business problems and supporting processes that need to be addressed.

Consider the example of mortgage processing and underwriting involving several manual hand-offs between different teams before a case can be offered. In this situation, configuring a replacement technology solution to replicate this will not address the business problem with application submission to offer turnaround times. It’s at this point that business process re-engineering requires consideration.

Business process re-engineering

In the above example of several manual hand-offs of a case between different teams, an analysis of how to create a leaner business process to increase case flow and accuracy is highly effective.

Often delivered in a series of lean rapid improvement workshops over six months, the sessions help to streamline the application journey and properly document business processes, which can also be used for technology solution consideration. In addition, this process increases buy-in and adoption of any transformation through team collaboration.

An unbiased RFP process

Following this analysis, it’s commonplace for a request for proposal (RFP) process to be embarked upon with good intentions – often with governance that demonstrates how an objective decision to use a supplier was made. However, human emotions often creep into the RFP process, and sometimes a decision is made based on exasperation with a current supplier or an emotional connection with a new one.

It can also be commonplace for suppliers to showcase future features that are not yet available or for existing suppliers to be discounted on a previous experience or relationship. Acknowledging this and adopting an unbiased assessment is critical to maximising project success.

Software adoption versus customisation

Upon deciding on a new system, lenders often customise a technology solution to cater to their business needs.  However, there is often a long-term cost for short-term solutions. The software customisation presents risks of delayed delivery, as features which do not yet exist must be built first and then tested. In addition, customisation to suit existing business processes may erode some of the expected efficiency gains.

The biggest pain of customisation is felt in the long run when the software is live and the vendor needs to release new features or upgrades. There is a risk that these may break existing code, meaning releases are delayed or even indefinitely postponed. Therefore, there is a risk of being stranded on a legacy version of software whilst rivals benefit from the latest version. Unfortunately, there are actual examples of this within the mortgage industry.


By focusing on the wider business problem and placing business process re-engineering hand-in-hand with technology transformation, lenders can maximise anticipated benefits. In addition, implementing an unbiased RFP process and taking a long-term view of the customisation of a solution will give lenders a greater chance of success.

Garry Sukhija, Director at Retail Banking Consultancy

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