Align, focus and believe: Lessons from Commonwealth Bank’s core banking transformation

With ambitions for customer experiences that had outgrown what its existing systems could deliver, Commonwealth Bank of Australia resolved to transform its most critical technology platform and take its core banking infrastructure into the cloud.

CBA banks one in three Australians and one in four businesses, so it was embarking on a program that was significant in terms of its scale and ambitious timeframes.

“It’s been about combining reliability with innovation to help deliver better, and more relevant experiences for our customers” CommBank CIO Business Technology Vicky Ledda says.

The project helped set the foundations for faster, more dynamic experiences for customers, with AI-enhanced personalisation and data-driven customer services, as well as improved reliability and resilience. From a technology perspective, it aimed to simplify operations, lift performance, and deliver a platform for future innovation.

The transformation touched nearly every part of the bank’s technology operations, requiring coordination across hundreds of teams and systems.

With years of planning and a little inspiration from TV’s most famous football coach, Ted Lasso, the project delivered a transformation of CBA’s SAP core banking platform, which manages 40 per cent of payments across the economy, and underpins 16 million active customer accounts.

The case for change

‘‘We put the original core banking platform in 16 years ago. A lot has changed about digital banking since 2010,” says CBA technology lead for core banking Simon Davies, who had key responsibility for delivering the project across the bank.

Modern infrastructure was required, and that meant moving into the cloud.

“Moving the core into the cloud can assist us in using our data more intelligently, anticipate needs, personalise support and respond to fraud and scams faster and with agility,” says Ledda.

But before the move to cloud could take place, a detailed, multi-year evaluation was undertaken. It considered both bespoke and off-the-shelf software models and worked through several proofs of concept before deciding on a solution the bank would move forward with.

The final model emphasised simplicity and standardisation for operational efficiency and resilience, with differentiation at the experience layer to ramp up the customer experience.

A decision was also made to run core banking on the same cloud infrastructure as other CBA systems, which not only assisted in simplifying architecture but also streamlined integration with other CBA platforms.

Partner ecosystem

The migration project itself took 18 months and was delivered in close collaboration with [partners] SAP, SAP Fioneer, Accenture, Amazon Web Services and Red Hat. “It was very much one team,” says Davies.

CBA wanted to keep configurations to vendor-supported standards where possible, he says. But co-innovation was also needed where standard setups did not meet the bank’s requirements.

Combining partner and CBA expertise proved key. For example, together with Red Hat and AWS, “we engineered a bunch of enhancements to their products that got us to a sub two-minute failover”, Davies says.

Scope and scale

The migration encompassed a total of nine SAP applications, but the core banking platform was “the Jupiter of the solar system” in terms of size and complexity, Davies says.

“There are very few banks in the world that have a real-time core ledger,” he says. And with high customer expectations on service speed and availability, a long cutover period was out of the question.

Where other organisations of similar size had taken more than 30 hours to make the final cutover to cloud, CBA had to get it done in eight hours or less, and make sure the new code base, middleware and infrastructure immediately worked at least as well as the old systems. 

“There was global interest in what we were doing here,” Davies says.

When cutover day came, CBA was only fully offline for three hours. But thanks to the way it was done, the impact on customer services was minimal.

Benefits

Right from the start, the migration of the core banking platform to the cloud delivered improvements across customer experience and performance, resilience, operational simplicity and cost.

With core banking sitting now closer to applications, customer services are now more responsive, Davies says. Payment updates that used to take about six seconds are now updated by the time customers have changed screens.

“Payments are now designed to update in real time, performance is faster, and the experience is more seamless,” Ledda says.

Thanks to some careful planning, the new cloud infrastructure also delivered more cost-efficient operations.

“We did extensive modelling on how to optimise our FinOps for this particular workload,” Davies says. “What would we have on demand, versus where we could buy compute savings? We did a lot of modelling upfront on what this would look like.”

Resilience was another major gain. The transformation made it possible for the bank to introduce a new “always available” layer that is designed to allow its mobile app to remain online during planned outages.

The bank remained online to customers during the final cutover to cloud.

“The fact that we can have downtime and remain online to our customers means that a shift-worker that’s coming out of work at 3am and wanting to pay for petrol on the way home can still transact. Those things are increasingly important in a digital world,” Davies says.

From siloes to cloud-native DevSecOps

Internally, the shift to a unified cloud architecture has also had an impact on how teams operate. “Being able to move to what’s essentially just one team top to bottom is the biggest benefit for us operationally,” Davies says.

Previously, eight different teams each managed different layers of the stack. “You basically had eight groups looking at their own individual dashboards,” Davies says. The borders between teams’ responsibilities made support more challenging.  

Now, the siloes that existed around different applications and architecture have been replaced by a single, integrated team that has the cloud operations, security, and engineering skills to oversee the entire operation.

“Shifting to full-stack teams and greater automation strengthened our agility and resilience,” Davies says.

Key decisions and success factors

With a huge, complex task and challenging deadlines, staying focused on the challenging parts of the project early and sticking to priorities was key to successfully delivering it on time, Davies says.

Constant calibration allowed resources to be moved where they were needed. Team dynamics were also a big focus. “We spent a lot of time with the team understanding what their workflow looked like, where they were getting stuck, where the breakdowns were,” Davies says.

To improve collaboration and speed, offshore partner delivery teams were flown to Australia and co-located with local teams, a move which proved to be a gamechanger, Davies says.

Like any large-scale transformation, the migration faced some challenges. For example, environment stability was a recurring issue, particularly during testing, Davies says. Testing itself was also a massive undertaking. “In the end there were 54 different crews who were involved in testing,” Davies says. To support them, the team embedded defect resolution specialists and created a responsive support model.

The team originally planned for three dress rehearsals to ensure confidence in the final cutover. “We did five in the end,” he says. But these rehearsals helped surface issues early and refine processes under realistic conditions, something that proved key during the final cutover.

Lessons learned

Ledda and Davies knew that creating the right culture was always going to be essential to make sure such an ambitious project didn’t become overwhelming and stall.

“A culture of courage, bias to action, and a genuine belief that we could achieve something extraordinary kept the business running as we transformed it,” Ledda says. “Being transparent about the ‘why’ and aligning stakeholders from the top down created shared ownership across the organisation.”

Alignment across the business was a vital ingredient for success, Davies agrees. “You can't do something of this scale in an organisation without the entire organisation pointing in the same direction,” he says.

Davies says there was some initial scepticism about whether the ambitious deadlines could be met. “We said ‘No, this is the date we are going to hit. You are the best people in the world to do this thing’.”

And for some extra motivation, “we borrowed the ‘Believe’ thing from Ted Lasso,” says Davies, referring to the famously upbeat football manager from the TV series of the same name.

“One day I came in and someone had printed out that ‘Believe’ poster and stuck it to the pillar,” says Davies. He says it started out as a bit of fun but quickly became a genuine rallying point for the team, who, like the footballers in the show, would touch the poster as they walked past.

“It gave people something to rally behind. We got two-thirds of the way through the project, and everyone turned around and said ‘Actually, we’re going to do this’.”

A platform to evolve on

“Transformations of this scale show what’s possible when clarity, culture and technology come together,” Ledda says.

With a modern, scalable platform now in place, the bank is now focused on unlocking new capabilities. People are learning “where they can leverage it more effectively to drive their ambitions”, says Davies.

CBA now has instant access to an incredible amount of data, paving the way for formidable AI and agentic capabilities and services. The platform has been built with an AI future in mind, says Ledda. “Big data and AI services are going to be key to evolving this workload,” she says. “It's a platform that we can evolve on.”