Companies in the financial sector have to comply with strict regulatory requirements. Triggered by the financial crisis in 2007, the legislator expanded the security regulations. These include so-called resolution planning: a kind of emergency concept that the competent authority uses in a crisis situation to minimise damage. Read how otris contract supports the Wüstenrot Group in this demanding task.
What should be done when a crisis situation threatens? Most companies only deal with this question when the specific case arises. Financial institutions are an exception: Above a certain size and systemic relevance, they must prepare a resolution plan. The plan contains important data and facts that the resolution authority needs in the event of a case in order to secure deposit funds. An orderly resolution led by the authority aims to ensure the continuity of critical functions, avoid negative impacts on financial stability and protect public funds and secured deposits of customers.
Resolution planning and contract management
The European SRB (Single Resolution Board) specifies what information a resolution plan must contain. “Much of what is in a resolution plan concerns ongoing contractual relationships and thus contract management,” explains Katharina Unger-Rumplmayr, Legal Affairs Wüstenrot Group. Service, maintenance, leasing and many other contracts are fundamental to maintaining the critical infrastructure of a financial institution. “Before the digitalisation of our contract management, these contracts were in paper form and locally at the responsible corporate unit,” Katharina Unger-Rumplmayr explains the initial situation and adds: “For the complex requirements of the settlement plan, we needed more transparency about the total stock of contracts. In short: we needed a digital contract management system for the entire Wüstenrot Group.”
Good advice, good software
Those responsible at Wüstenrot contacted otris software via a recommendation. In a direct comparison with other providers that Wüstenrot had shortlisted, otris scored with two advantages: An easy-to-use software interface and good advice. “After the initial discussions, we were convinced that the expertise to implement our complex requirements was there. This expectation was fully met by otris – the consulting in the project was excellent”, Katharina Unger-Rumplmayr describes the cooperation.
Tailor-made contract management.
In a software project, good consulting means that implementation and execution also function as specified in advance. One challenge in Wüstenrot’s contract management project: developing an understanding of what SRB settlement planning requires and how otris contract can provide the best possible support through customisation. In the implementation, otris consulting elaborately extended the digital contract files, created a workflow and integrated numerous data fields and dependencies into the software. Always in mind: the system must remain comprehensible for users. The solution that otris developed according to Wüstenrot’s specifications reflects exactly that: a complex system that is nevertheless user-friendly.
The legal department became aware that Wüstenrot needed digital contract management not only because of the regulatory requirements of settlement planning. “For example, when it was clear that Brexit was coming, we immediately needed transparency on all contractual relationships with British companies,” recalls Katharina Unger-Rumplmayr. “Finding that out was very costly with our decentralised, analogue system.” Today, the digital contract database with its filtering, sorting and search functions enables research “at the touch of a button”. This not only improves transparency, but also speeds up the research process.
Another process accelerator is the workflow-controlled contract release. Contracts that concern Wüstenrot’s critical infrastructure or outsourcing are subject to a multi-stage approval process before they are concluded. Only after the respective specialist departments have checked the draft contract economically and legally does it receive approval for signing. The digital procedure not only makes the process faster, but also more transparent: “If the approval process falters, we can see where the draft contract is. Colleagues can then speak directly with the department through short official channels to clarify open questions,” says Katharina Unger-Rumplmayr.
Security and cost optimisation.
More transparency and accelerated processes – not only security but also cost aspects speak for this in contract management. Automated deadline warnings, clear reports or informative evaluations can be used to prepare renegotiations in detail and optimise contractual relationships across the group.
More than 120 users at Wüstenrot use the new digital contract management system. Depending on the task and access rights, they use it for research, operational contract management work, contract approval or in the area of compliance to meet regulatory requirements. What all users have in common: they benefit from easy-to-use software that simplifies their daily work.
In 1925, Wüstenrot brought building savings to Austria. Since then, more than 500,000 homes have been built in Austria with Wüstenrot financing. Today, the Wüstenrot Group is a Central European financial group. Some 2,400 employees in Austria, Croatia and Slovakia very successfully serve more than 2.1 million customers with complete solutions from a single source in the areas of saving, financing, provision and insurance. Through targeted customer and service orientation as well as the ongoing development of innovative products, the trust and loyalty of customers will be maintained and further expanded in the future.
The photos used (banner, quote) were kindly provided by Wüstenrot (AT).