PONTIAC, Mich. -
Henmueller, the president of Chief Pontiac, has joined the growing crowd of credit union executives who are deciding to employ "Software as a Service" (SaaS). In other words, Chief Pontiac allows a remote, third-party provider to host almost all of the credit union's software, applications and data.
The $92-million credit union stores everything from Microsoft applications to the core processing system and government reporting programs at the Galaxy Data Center Network (DCN), located in Troy, said Henmueller. DCN is offered by Galaxy Credit Union Solutions.
"The only software we still host ourselves is the vending machine," he joked, adding that the credit union does maintain a few pieces of software in-house because of licensing limitations.
In addition, data, ranging from transaction data to the contents of Henmueller's monthly letter, can be encrypted and stored at the DCN.
The DCN delivers everyday software and data to employees' desktops over private communication lines from a remotely-located server, so there's no need for Chief Pontiac to keep a large in-house IT staff or expensive equipment, according to Vince Francone, senior vice president of information technology and operations at Galaxy.
Hopping Onto 'Cloud Computing'
Why else would a CU want to hop onto "cloud computing" and store all of its applications, software and data off-site? For Chief Pontiac, SaaS saves money and allows employees to focus on credit union business, instead of fixing computer servers, said Henmueller.
"To me, a server is someone who brings the pancakes and the coffee," Henmueller continued. "My job is to know what kind of services, financial products and education to offer our members, not what kind of technology we need."
With the DCN service maintaining and updating all of the software and backing-up and encrypting all of the data for one year now, Chief Pontiac has been able to eliminate the budget line-item for at least one IT employee, according to Claudia York, the credit union's executive vice president.
"Since going with DCN, the credit union has lost three employees due to retirements," York said. "These positions have not been filled. DCN is believed to account for the further reduction of 1.5 full-time employees."
Chief Pontiac staff that used to work on data processing and network issues has been reassigned to new projects, including a business lending venture, stronger security, better training and a shared branching outlet, York said.
"Within 12 months of going with DCN, we have recovered all of our costs," Henmueller added.
Nick Arvon, CEO at the $41-million CAMC Federal Credit Union in Charleston, W.V., tells a similar story about the savings he's seeing from SaaS.
'Our Biggest Problem'
"Our biggest problem in the past was the network going down," Arvon said. "We spent 300 to 400 hours per year doing some sort of IT work that has now been eliminated by DCN."
York agreed: "So many things that felt like an annoyance are now all going away."
SaaS just makes "immediate sense," especially for those credit unions under $100 million in assets, according to Francone.
He pointed to a story, headlined "Will Only the Big Dogs Survive" in the July 16 edition of Credit Union Journal, which traces the ongoing dissolution of the small credit union.
"DCN offers economies of scale," Francone said. "We provide two data centers plus another for backup. For a credit union to replicate that kind of disaster recovery would be next to impossible. We also provide the data line security and an experienced staff whose only job is to solve the same problems for dozens of credit unions."
DCN can't cover all the bases, however, said Francone.
"Some credit unions still suffer the emotional barrier of storing all their software and data in one place with a third party."
Henmueller sees it as "just the opposite," he said. "I used to work at a credit union with an in-house computer operator and systems. Fraud was much more prevalent there."
more
Read more about SaaS and off-site technology at cujournal.com and search the following bolded terms in the archive:
* Will Only The Big Dogs Survive?
* What's Next On the Net
* Trashing Your Network Security
For more info on this story:
* Chief Pontiac FCU, www.chiefpontiac.com
* CAMC FCU, www.camc.org
* Galaxy, www.fiserv-galaxy.com
