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Danish financial technologies firm BEC provides a full range of IT solutions for their member banks, spanning from workstation management solutions, to supporting applications in daily operations, to BI and analytics and data storage. BEC’s mission is to optimize their clients’ business to maximize the return on their IT investment and to allow their member banks to focus on their core businesses.
That’s why BEC’s Mortgage domain team, headed by domain architect Alexander Lorenzen, uses Camunda to power their process orchestration throughout their mortgage application processes to navigate the unique complexities of the Danish mortgage system and to increase efficiency, time savings, and value, to their member banks.
BEC’s Mortgage domain builds business processes within the mortgage realm to support all common business scenarios with full end-to-end processes. To achieve their goal of providing value to customers in the form of time savings, the team seeks to minimize maintenance costs by decommissioning legacy alternatives.
Often, this team experiences that their clients’ core systems are aging and carry a lot of legacy, and were not designed specifically with the mortgage application process in mind. Additionally, there is usually a lot of dependence upon other departments and systems, as BEC needs certain data and business functions to be exposed through standard interfaces to implement a solution for their clients. As a result, substantial efforts have been required from other departments to support the mortgage application solution roadmap.
Adding to this technological complexity is the mortgage application process itself; in Denmark, a multi-party system governed by stringent regulations means that by design, most all steps involved in realizing a mortgage loan are manual tasks and the full end-to-end process can be incredibly time consuming.
In Denmark, a property is rarely financed by a single entity. Instead, the typical mortgage follows this pattern:
All mortgage loans, including bank loans, are secured through mortgage deeds. These are put up as collateral and registered in a public ledger (the Danish Public Landregister). This ledger keeps a prioritized list of creditors with claims in the property in the event that the loan(s) cannot be maintained. This system means that there are several stakeholders involved in any mortgage related business process – a mortgage provider, the Danish Public Landregister, as well as the customer(s) themselves.
BEC’s Mortgage domain team seeks to overcome that complexity and improve mortgage application workflows for their clients by:
This project was extremely visible both to teams in BEC and to their customers; mortgage related processes are considered business critical for these banks, netting high attention and interest in the solution’s performance. A success in a business critical domain reflects positively on the organization as a whole.
To create a solution that can deliver on its goals, the Mortgage domain team needed to design it as a “green field” that leverages existing capabilities in surrounding core systems. However, designing this process is more complex than it initially appeared.
“I think of a mortgage process as a constellation of several subprocesses, each of which should be orchestrated by its own right,” explained Lorenzen.
Some of the subprocesses that the team needed to take into account when building their solution included:
The BEC team decided to start with the ‘remortgage’ process, whereby an existing loan is redeemed and replaced by a new one. This decision was driven by the potential value that process brings to BEC’s member banks – for example, when the national interest rate changes and better credit terms can be provided through a different loan product.
The goal with this process redesign was to create a standardized process across all of the banks using the system. Minimizing variance and breaking down complexity were both requirements for BEC in order to provide a robust solution which offers both scalability and reusability.
For Lorenzen, the biggest obstacle to overcome was getting everyone to agree on what the process should actually look like. By focusing on this first, the team could deliver orchestrational value up front and ensure that they would automate the right things in the right way. That’s why a process orchestration platform with BPMN capabilities – like Camunda – is so valuable to BEC.
“Using BPMN to model the business process as-is allowed us to bridge the gap between the business and the ‘techies’,” explained Lorenzen.
The team started with an orchestrated but only partially automated process and gradually automated the individual tasks over time.
BEC’s mortgage solution consists of a microservice-oriented architecture based on Java applications. Camunda fits in seamlessly and acts essentially as a dependency to a standard Java application. The solution has an AngularJS-based frontend on top, calling REST APIs in the backend. Some of these APIs interact with Camunda to start a process or to facilitate user tasks that are part of an existing process.
Mathesien noted that while sharing a codebase across several developer teams is always challenging, it has highlighted a burning need to establish a shared set of principles and modeling standards, particularly when it comes to BPMN.
Currently, Camunda orchestrates the process from granting a loan all the way to signing off and closing the case. In the happy path scenario, when everything has been granted and set up, the advisor can order an offer, and the process takes care of the rest. The process emits certain tasks or notifications when something happens that requires the advisor’s attention, but generally, it is fully automated.
This automation helps BEC customers focus on their core business and provide faster, more efficient service. On average, the Camunda-powered remortgage process saved agents 100 minutes per case. That’s 100 minutes of otherwise manual labor which can now be invested elsewhere, such as in cases that require exception handling or other human intervention. Additionally, automation is not just a time saver, but can minimize the potential for human error within these processes, protecting both the bank and their clients.
Lorenzen’s team also enjoyed several benefits from incorporating process orchestration into their mortgage process solution, including:
Overall, the mortgage process has been made more efficient for BEC’s clients, allowing them to better focus on their core business and deliver superior service to their customers.
Lorenzen’s team is hard at work expanding the roadmap of mortgage-related business processes to be added to the solution in the near future, including the supplementary mortgage, change of ownership, and prepayment processes.
Additionally, the team is looking at a number of complex cases that, while the processes are running, remain unsupported in their solution. Until every process is supported, BEC cannot fully decommission the old legacy systems, which is their end goal.
Additionally, Lorenzen is constantly on the lookout for ways to streamline and unify existing business process models to make them more generic and reusable.
“I would like to see our BPMN repository as a set of LEGO bricks which can be combined into any mortgage related business process,” he explained.
Also, he believes that much of the value that Camunda and process orchestration has brought to the Mortgage domain, and by extension the customers using the system, can be transferred to other domains. Since so much of the business functionality relies on surrounding core systems, with BEC effectively orchestrating on their behalf, a shared Camunda platform could deliver multiple returns.
Lorenzen gave the example of document management, which is managed by the Core Banking team. With a shared Camunda platform, the Core Banking team(s) could build their own, generic document management process, and they could use that instead of building their own.
Orchestrating more business processes gets BEC one step closer to having a full end-to-end perspective on the user journeys for more complex business processes, allowing for more data-driven conversations and decisions with customers. The value of process orchestration helps BEC tackle its vital mission – to optimize their clients’ business, maximize the return on their IT investment, and to allow their member banks to focus on their core businesses.
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