Donald Westermann Rebuilds Eastern Bank's IT Foundation

Elite 8 honoree SVP, Technology Engineering and Operations, Donald Westermann is re-architecting Eastern Bank's technology to prepare for the economic recovery and a return to growth.
Take one look at the bustling IT shop at Eastern Bank and one would probably feel as if beamed back in time about four years, when the financial crisis was still unthinkable and banks’ coffers were flush with funding. Donald Westermann, SVP, technology engineering and operations, at the Boston-based bank and his team are busy rebuilding Eastern’s entire IT infrastructure from the ground up so it’s ready for the upturn. In the two years he has been on the job, Westermann has guided some pretty significant transformational projects, all in the name of making the bank a more nimble, more competitive financial institution.

“Two years ago, we sat back and asked ourselves what we were doing at Eastern from a business perspective and how we, as an infrastructure team, could assist the business lines in achieving their targets,” Westermann relates. “We came up with some key constructs. First, security in general, with the monetization of information breaches, is always a great concern. Second, we have to realize that security and functionality are often at odds with each other. Expense management was also vital, with the consolidation and all that has been going on in the past couple of years in the industry. So we needed to balance all these elements as we developed our strategy.”

The result of this strategizing was what Westermann calls the bank’s infrastructure services architecture framework. The new framework, he says, gave him and his team a road map for how they would rebuild Eastern Bank’s ($6 billion in assets) foundational architecture to best support the business. According to Westermann, the tenets of that framework include realizing economies of scale by standardizing and simplifying technology, leveraging advanced and emerging technologies, gaining efficiencies and cost reductions with the use of common processes and technologies, and increasing the bank’s scalability and flexibility to allow for future growth.

“We have grown through a series of acquisitions and hope to continue growing with the upturn in the economy,” Westermann notes. “That’s our focus as a bank as we prepare for the upturn.”

The use of standardized technologies is playing a large role in the re-architecting endeavor as the bank seeks to unify its IT following those acquisitions, Westermann relates. Key to the effort, he reports, was moving from Novell(Waltham, Mass.) to Microsoft(Redmond, Wash.) as the base technology at the bank.

“We started with an incredibly mixed environment two years ago,” Westermann says. “We started along the path to collapsing what I call ‘islands of administration’ — whether they be individual work group servers or multiple Windows domains. We rebuilt the common core services to enable larger-scale projects. We’ve also systematically reduced our management footprint.” As a result, Eastern has consolidated seven or eight administrative domains when the project began down to just one or two, Westermann notes.

The icing on the cake is that Westermann was able to embark on the project, which is ongoing, without staff reductions. Bucking the trend of other small banks that lean toward outsourcing and more out-of-the-box solutions, Eastern instead sought to build out its internal expertise.

“Historically, a number of our processes and technologies on the infrastructure side had been outsourced, like managed services such as security,” Westermann explains. “We believe in being creative in managing and implementing technology. A lot of these managed-services relationships need you to fit into some kind of mold or cookie cutter; we were too customized for these companies to offer us quality support. So we tore out a lot of those managed services and staffed up in the engineering areas to get those skills in-house. But it’s a mix for us. If we think we can get a strategic advantage by bringing skills in-house to provide that extra level of performance and scale, then that’s what we’ll do.”

And Westermann remains undeterred by naysayers who advise caution and thrift during times of crisis. On top of the re-architecting work, he has begun migrating the bank’s entire telecommunications infrastructure to voice over IP technology. “This goes back to being platform-centric,” he says. “We ran individual phone systems in each of our locations, so you can imagine what the overhead was like. VOIP has resulted in significant cost reductions for us.”

Breathing Room

With so many projects to juggle at once, Westermann admits, it’s hard for him and his staff to come up for air. "I have an absolutely extraordinary team," he says. "They’ve been running full speed for two years. Trying to take our foot off the accelerator to give everyone a little breathing room is the toughest thing for us now, especially as the team has such a high sense of ownership of the overall technical environment. The team just wants to keep on running. It’s a great problem to have."

It's no wonder that Westermann says he just can’t unplug when he’s out of the office. "I find it difficult for me to mentally disconnect,” he relates. "I constantly focus on projects or issues on my commute, nights and weekends. I’m always connected to it. I’m not necessarily pecking away at my BlackBerry, but I’m mentally trying to prepare for the next day or week.”

And, incidentally, Westermann points out, he’s exclusively a BlackBerry man — no iPhone for him. However, he acknowledges, the younger generations are good bellwethers in terms of which technologies the industry should pursue next.

"Personally, I go more for the application-type tools as opposed to the more collaborative ones," Westermann notes. “For example, I see a lot of value in something like [personal financial management site]Mint.com. And I’m still pretty old school in that I talk to my friends on e-mail and on the phone. But when I talk to my peers about these applications and I watch my wife on Facebook, you just kind of see the ebb and flow of this technology. They initially find it interesting, but then their interest wanes. So I wonder at the long-term viability of these technologies.

The Elite 8 2009

"However, harnessing the underlying concepts and innovations here is key. And if it's so engaging for the younger generations, then it's important to see if it will be the next e-mail." Plus, Westermann adds, he never loses sight of security, which is another reason why he is not quite so active on the social networking scene.

With his degrees in economics, business administration and management information systems, Westermann recalls, he landed a position in the technology risk consulting practice at Arthur Andersen. When his group later moved to Grant Thornton after the Andersen implosion, he noticed that one of Andersen’s clients, Eastern Bank, was also a Grant Thornton client. The familiarity eventually led to a position with the bank.

“When you focus on information security, systems analysis and risk management, they tend to trend you toward the financial services industry,” Westermann explains of his move to Eastern Bank. “And it has been an interesting two years for me.”

Things will no doubt become more interesting as Westermann’s work progresses and the bank further positions itself for the economic recovery. “In relation to the rest of the business, IT has gone through a lot of changes over the last few years,” Westermann notes. “Much of these changes were welcome as people were given the tools to more easily collaborate and were better able to interact with the customers. We have quite a partnership with our [internal and external] customers, and I hope it continues to grow.”