By John San Filippo
In February of 2022, financial technology provider Jack Henry announced a massive core processing modernization initiative that will result in a brand-new, built-from-the-ground-up core system with a first-of-its-kind modular design. At that time, Finopotamus spoke with Jack Henry CEO David Foss to clarify some of the finer points of the initiative and what it means to credit unions running the company’s Symitar core platform. At the 2023 Jack Henry Connect, the company’s annual user conference, Foss sat down for a face-to-face interview with Finopotamus to provide an update on the project.
In the Cloud
At the time of the previous interview, the new core was unnamed. During the conversation at the Indiana Convention Center in Indianapolis, Foss disclosed its new moniker: the Jack Henry Platform. What also wasn’t made clear in 2022 is the platform’s reliance on the Google Cloud.
“What we've created is this platform that sits on the Google Cloud, and it's underpinned by all the functionality that Google brings to bear in the cloud environment,” explained Foss. “The database that underlies all this stuff is going to be the Google Cloud database. The security infrastructure that underpins all this is the Google Cloud security infrastructure. All the development tools that we use to develop all the new stuff we're doing, that's all provided by the Google Cloud. The design technology to make everything look the same and feel the same and operate like modern technology, that's all being provided by the Google Cloud.”
Asked what else the Google Cloud “brings to bear,” Foss continued, “Look at the DevOps environment [provided by the Google Cloud]. That's a whole different way of developing software. The idea is that you're able to do rapid release of software. That's point number one: You can do DevOps in that environment, and you can't do it in a traditional development environment.”
Equally important, he added, is the ability to do “burst” processing. “The Google Cloud offers essentially limitless processing,” said Foss. “Jack Henry has big data centers, but we have a limit to our processing capacity. So when you get to the end of the month or the end of the quarter and you're running these big jobs in our current environment, there’s a limit to how much we can process, which means it takes a little longer.”
According to Foss, burst processing eliminates this issue. “Say you're running along every day, you consume this much processing power, and then at the end of the month, you can consume as much extra power as you need – which you of course pay for – but then you scale right back down again to your normal day to day.” He added that, for example, a job that takes 10 hours in the current environment might only take an hour in the Google Cloud.
“The security environment in the Google Cloud environment is better than anything in the world according to experts,” he added. “I'm not the expert at that, but all the people that are talking to me say it's the best security environment.”
The Componentized Core
Foss told Finopotamus that the Jack Henry Platform’s architecture will allow credit unions to customize their core with only features they need. “Because we have created these components or modules, as opposed to a monolithic core, you can pick and choose which things you want to run to support whatever it is that you are doing at your credit union,” he explained. “So if you're some type of specialty credit union that only wants to offer these specific services, you can buy those components that support those services. They may be core components, or they may be things that are traditionally thought of as complementary.” He noted that while third-party products will be easily integrated via API (application programming interface), only Jack Henry components will plug directly into the platform.
Asked whether a credit union runs the risk of over-complicating its technology stack because there are so many options, Foss said that’s a common question. “Most people will buy some kind of bundle. They will say to us, “This is what I want to accomplish. These are my pain points. This is my strategy. Tell me what pieces I should buy from Jack Henry in order to do all that.’ So we'll propose a bundle that'll be this, this, this, and this. And in some cases, the bundle's going to look just like a traditional core.”
Symitar’s Future
When Finopotamus spoke with Foss in 2022, he said he anticipated that some credit unions would continue to run the Symitar platform, some credit unions would run the Jack Henry Platform in tandem with Symitar to achieve greater functionality, and some credit unions would opt to migrate completely to the new system.
“The benefit that I have now is we've actually talked to a whole bunch of prospects and customers about what we're doing, and it's absolutely what's coming true’” said Foss. “It's very common in these conversations when people talk about mergers, the idea that I could potentially merge with another credit union and put some of their functionality on the public cloud. I can kind of minimize the risk of a full-blown conversion and start to consume things on the public cloud that will de-risk the whole situation.”
Foss said the company has absolutely no plans to force anyone into a core migration. “The thing that I stress all the time – and I just hosted the CEO Forum yesterday – I stressed in there and I stress all the time that we are not slowing down our investment in our current cores,” noted Foss. “Symitar is the leading core solution in the credit union industry. We are not slowing down at all. That's important because we know we're going to have customers running Symitar for many years.” He added that there currently is no firm timeline for the general release of the Jack Henry Platform.
In closing, Finopotamus asked what this shift to the cloud has done for Jack Henry’s once-flourishing hardware business. “Our hardware business is minuscule these days,” responded Foss. “We would rather not be in the hardware business, so I'm totally fine with us not selling hardware. That's not a strategic offering from Jack Henry.”