Needs of searching for sources of improvements on both the costs and service quality dimensions.
The increasing dissatisfaction on services received from the bank BPO supplier and the limited economies of scale acknowledged, associated with the need of searching for sources of improvements on both the costs and service quality dimensions, have convinced the bank to launch this review.
In order to quickly achieve this goal, we have proposed to pursue the following objectives as deliverables of the review, leveraging on our “Frame” methodology:
Produce true argumentations to be used to push the BPO supplier to review the 2017 Service costs in a way more favourable for the bank,
Elaborate recommendations for optimization aiming at reducing the internal FTEs devoted to manage the outsourcer through the elimination of redundancies in process tasks, reassigning tasks to the outsourcer where contractually supported,
Revise the bi-party project offer process, in order to gain a better alignment between the bank projects being part of its IT strategy implementation and the core banking system evolution,
Perform a light audit on the bank’s current contractual IT architecture in comparison to the bank’s ambitions, and formulate recommendations, if any, on how to better manage the outsourcer evolution strategy for its core banking and peripheral applications.
The deterioration of service quality, the even increasing costs for any project performed together with the suppliers, and especially with the BPO supplier, associated with unclear requirements fulfilling, delays in delivery of key functionalities and a progressive deviation of the IT strategies of the BPO community from the client needs, brought the bank to look for differentiated solutions to face these issues.
These issues have requested, as first, a reduction of the operating model complexity, establishing new service quality parameters and new target implementation and maintenance costs for IT solutions.
Of course a strengthening in the governance processes and a realignment of skills available in the company have been considered as part of the target solutions.
All that said, our recommendations have been formulated following the need of tactically approaching all the concerns.
We have proposed measures and directly implemented them, producing savings of more than 15% in the service costs, building a clear path to the execution of a revised IT strategy, realigning all the ongoing IT projects to the business initiatives and contributing to the right-sizing of the bank units in coordination with the outsourcer, re-distributing activities and responsibilities.