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Outsourcing Technology for a bank is like outsourcing the bank

“In many ways, we see ourselves as a technology company with a banking license.” Michael Corbat, Citibank CEO

Consulting firms over last two decades have guided Banks to “Outsource Technology to Technology Providers”. This has helped the banks in focusing on their core competency, which is “Banking”. Based on this approach, technology teams within the bank moved
from “Development Approach” to “Outsourcing Program Management Approach”. In last two decades, they have attained skills in architecture, support, outsourcing and controlling multiple partners, while losing skills in pure technology and development.

With continuous improvement in technology, the banking knowledge has moved deep into codes algorithms. This has resulted in slow and steady reduction in banking knowledge within each organisation. In most of the banks, the intricate accounting, interest
calculation, charging algorithms is known to a very few, which was once known to each person in a branch (when this was done manually).

Digital wave arrival of Fintechs has shown the banks that technology can drive the business models.

  • Customers are now used to interacting with banks through digital channels from on-boarding to off-boarding and everything in between.
  • Sales teams are now becoming more productive through sales tools available in their tablets.
  • Operations staff continues to increase their productivity through tools like OCR, API, RPA etc.
  • Fraud management units have started relying on triggers from Artificial Intelligence Platforms running on continuous stream of transactions.

Banking Industry as such is moving from

High Value, Low Volume, High Touch, Defect Prone, Slow Processing Industry

TO

Low Value, High Volume, Low Touch, Defect Resistant, Fast Processing Industry

Business and technology are getting so close to each other that they cannot be segregated and for sure one part (technology) cannot be outsourced anymore. Some banks could sight this mega trend and had started investing in their digital strategy and technology
units. These banks have moved digital initiatives into the centre of banking to create differentiated profitable business model. They have hired best talents in the market around Artificial Intelligence, Development, Design, API, Digital Payments, Digital
Lending etc.

In these organisations, technology teams are now additionally responsible (beyond running the bank, which based on my own experience is challenging in itself) for:

  • Co-building Digital Strategy of the bank
  • Driving Digital initiatives in partnership with business teams.
  • Partnering with external entities like Fintechs / Financial Institutions for generating new streams of Business
  • Selling technology driven services to customers (like API based integrations to corporates)
  • Guiding the bank in acquiring / investing into Fintech / software companies
  • Building digital culture in the organisation

The change in role needs rebuilding technology teams in alignment with the change in expectations. Digital initiatives need knowledgeable and agile in-house technology teams. There is a need to review the areas to be outsourced and need to be in-sourced.

In the current business environment, Outsourcing Technology for a bank  is like outsourcing the bank.

Article source: https://www.finextra.com/blogposting/14105/outsourcing-technology-for-a-bank-is-like-outsourcing-the-bank

Outsourcing could become a stumbling block in public sector pay …

The union representing low-paid civil servants has rejected the Government’s efficiencies “wishlist” outlined in the ongoing pay talks and warns there can be no further productivity deals.

And one of the items on that wish list — outsourcing — could become a significant bone of contention as the Government seeks to potentially weaken the safeguards around how outsourcing can happen.

The sides held detailed negotiations on outsourcing, apprenticeships, and various other non-pay issues yesterday. As those talks were due to begin, Civil Public and Services Union general secretary Eoin Ronayne told his members in a posting on its website that the wish list tabled by the Department of Public Expenditure and Reform contains items rejected by the unions during the Haddington Road and Lansdowne Road Agreement talks.

“It is not unexpected that DPER would table fresh productivity demands although the breadth and nature is,” he said. “We will continue to hold our position that there can be no further productivity deals and that FEMPI for our grades must be ended.”

Among the measures being sought by the Government are the outsourcing of some public services; making Saturday a normal working day and therefore not subject to any premiums; and the widening of potential redeployment limits from 45km to 60km.

In spite of Mr Ronayne’s comments, other sources have speculated there will be no new deal without some productivity concessions.

In discussions regarding outsourcing yesterday, sources said the Government appears to be seeking to weaken the controls which exist on how services can be given over to the private sector. At present, a business case must be presented as to why the service should be outsourced, and that business case is not allowed to includes labour costs.

It is feared that if labour costs were to be included, the private sector could offer the service at the lowest possible wage and most basic conditions — it would leave little chance that the public service could compete.

Today, the sides are due to discuss two further controversial issues — there will be a presentation on pensions in the morning and talks on the restoration of hours in the afternoon. The Government has indicated that it will require public servants to pay more towards their pensions in any new deal and it has also signalled that it is not willing to restore public servants to the hours they were working before the financial crisis.

© Irish Examiner Ltd. All rights reserved

Article source: http://www.irishexaminer.com/ireland/outsourcing-could-become-a-stumbling-block-in-public-sector-pay-talks-450766.html

Unions in pay talks oppose plan to allow more outsourcing

Public service trade unions have signalled they will strongly oppose any reforms proposed by the Government that would facilitate more outsourcing of services.

It is understood that at the talks on the new public service pay deal the Government indicated that it wanted to remove measures which unions view as safeguards against the external provision of existing public services.

Sources said Government representatives had not given any details of specific services which it would want to outsource in the future.

Under the existing Lansdowne Road agreement, Government departments and agencies have to consult unions on any plans for outsourcing of services and, in such circumstances, the cost of labour must be excluded from the business case supporting such an initiative.

It is understood that as part of the talks on the new pay accord, the Government wants to be allowed to consider labour cost savings in the cost-benefit analysis of any future outsourcing plan.

Union sources said their position was not that there should be a blanket ban on outsourcing but that they would strongly oppose any removal of the curent safeguards.

Sources also said that talks on Tuesday regarding Government proposals to reform rostering arrangements ended inconclusively and that the management side had not tabled any specific proposals.

Meanwhile, the Government is expected on Wednesday to begin discussing highly controversial proposals to have some public service groups – which are considered to have more valuable pensions – contribute more for their pension benefits. Strong opposition is expected from groups such as gardaí.

The talks on Wednesday are also expected to feature the requirement for staff to work additional hours without extra payment – another highly controversial area for many unions.

Article source: http://www.irishtimes.com/news/ireland/irish-news/unions-in-pay-talks-oppose-plan-to-allow-more-outsourcing-1.3093895

NelsonHall Names Unisys an Application Outsourcing Leader

BLUE BELL, Pa., April 10, 2017 /PRNewswire/ — Unisys Corporation (UIS) today announced that leading Outsourcing Research and Analysis firm NelsonHall has positioned the company as a Leader in the new NelsonHall Vendor Evaluation and Assessment Tool (NEAT) report on Application Outsourcing.

The report identifies Unisys specifically as a Leader in the “Overall” market segment, stating that the selection “reflects Unisys’ overall ability to meet future client requirements as well as delivering immediate benefits to application outsourcing clients.”

The report also calls out Unisys’ strengths, including its holistic approach to service delivery by integrating infrastructure and application services:

By integrating many of its capabilities into tools (such as ITSM and monitoring) that can span both applications and infrastructure, [Unisys] can present a compelling case for economies of scale.

Unisys’ use of automation and analytics positions it well, and it will be even better positioned once its cognitive solutions are offered later this year. Its parallel efforts to build out toolsets targeted at specific industry needs also represent an important step in evolving its capabilities.

In addition, the report remarks that Unisys provides “[b]road toolset offerings across DevOps” and notes the extra value that Unisys Stealth® micro-segmentation security software – which creates segments within an organization where only authorized users can access information, while others cannot even see that those segments exist – can yield for “target markets such as public sector and FSI [financial services industry].”

“Unisys seeks to differentiate itself in application outsourcing by providing solutions focused on security and integration with the client’s total infrastructure,” said David McIntire, NelsonHall research director and author of the report. “That integrated approach to developing and refining applications is important to enterprise clients in an era when success in digital business depends on marshalling all enabling technologies to deliver new levels of service to customers and seize quickly on continually evolving business opportunities.”

“Unisys is proud to be positioned as a Leader in this influential report,” said Andy Stafford, senior vice president, Services, Unisys. “This recognition demonstrates the value of our approach: providing clients with secure, contemporary applications, tailored to their specific vertical industry, that draw on a range of integrated IT resources to provide a competitive edge in digital business.”

Click here for a copy of the NelsonHall NEAT Report on Application Outsourcing.

Click here for information on Unisys Application Services.

About Unisys

Unisys is a global information technology company that specializes in providing industry-focused solutions integrated with leading-edge security to clients in the government, financial services and commercial markets. Unisys offerings include security solutions, advanced data analytics, cloud and infrastructure services, application services and application and server software. For more information, visit www.unisys.com.

Follow Unisys on Twitter and LinkedIn.

About NelsonHall

NelsonHall is the leading global BPS and ITS research analysis firm. Founded in 1998, the company takes a global approach to analysis of vendors and outsourcing markets and is widely respected for the quality and depth of its research. NelsonHall also offers a suite of “Speed-to-Source” tools, including NEAT, that assist buy-side executives in saving time and money, while enhancing the quality of their sourcing decisions, in BPS and ITS evaluations.

RELEASE NO.: 0410/9493

Unisys and other Unisys products and services mentioned herein, as well as their respective logos, are trademarks or registered trademarks of Unisys Corporation. Any other brand or product referenced herein is acknowledged to be a trademark or registered trademark of its respective holder.

UIS-C

To view the original version on PR Newswire, visit:http://www.prnewswire.com/news-releases/nelsonhall-names-unisys-an-application-outsourcing-leader-300436687.html

Article source: http://finance.yahoo.com/news/nelsonhall-names-unisys-application-outsourcing-115600585.html

Outsourcing service left Scottrade Bank customer data exposed

Business process outsourcing (BPO) service provider Genpact left customer information at Scottrade Bank vulnerable through a cloud server that did not have the right level of security.

According to Scottrade Bank, information about 20,000 people and businesses in its small business-to-business (B2B) unit was not fully secured.

Genpact has admitted the mistake and secured the information  as soon as it was alerted and discovered the origin of the error.

“Genpact works exclusively with the B2B bank unit and has no access to any other information at our firm,” said Scottrade in a statement. “This appears to be a case of isolated human error by the supplier in handling the dataset.

“It is important to note that we hold all of our third-party suppliers to rigorous information security standards. The supplier has acknowledged responsibility for this incident. This is a discrete issue with no link to any other aspect of our business. Our own systems remain secure and were not involved in this matter.”

Genpact is currently trying to find out whether the data was accessed and has hired a forensics firm to help it.

The case fires a warning to enterprises to be prepared to deal with problems caused by service providers.

In the UK, the Information Commissioner’s Office can impose a maximum fine of £500,000. In October 2015, TalkTalk was hit with a record £400,000 fine over the cyber attack in 2015 that exposed personal details of more than 150,000 customers. But the reputational damage for businesses can be far greater.

This is a particularly important issue for UK companies, which are highly dependent on BPO and IT service providers, yet may be unprepared for disruption caused by supplier mistakes.

According to research from Deloitte, 80% of UK businesses are very dependent on services from outsourcing providers. The same research found that one-third of businesses in the UK have  experienced major disruption or complete failure due to the actions of an outsourced service provider in the past three years, but also revealed that only 11% were prepared for this.

It is essential to ensure cloud contracts protect the customer’s business against data loss. Talking to Computer Weekly in February, outsourcing consultant Bob Fawthrop cited a case he was involved in where a cloud-based financial transaction supplier that was going to move data from one system to another would not take responsibility for data loss, despite the fact that it was moving the data.

Article source: http://www.computerweekly.com/news/450416537/Outsourcing-service-left-Scottrade-Bank-customer-data-exposed