HSBC’s IT department, with a team of around 3,500 in the UK alone, is looking at using shared services and more collaborative work. It is organised to work closely with the business, and uses dual skilled business relationship managers to ensure that technology fulfils the needs of the business. Wherever possible, technology and systems are now shared between the different parts
of the business.
IT now has a good understanding of the needs of the business, and can source solutions from other HSBC businesses, so there is more internal work being done, rather than core building. Business management has become key, so direct reports to senior executives have an impact on delivery to other areas of the business.
Cost efficiency is still a big driver for the bank. IT operations expect a reduction in the unit rate of 10 per cent annually, apart from development costs, and the IT operation is now in the top quarter of HSBC benchmarks for costs in the organisation in Europe, and the top half in HSBC Group metrics on service. Process control targets for the business are working well for IT.
HSBC is at the beginning of a new era in IT operations, with CIO Rumi Contractor taking up the post in January. One of the first issues that confronts him will be the latest compliance issue, the EU’s Single European Payments Area (SEPA), which aims to drive down pan-European transaction costs, and is due to come into force in 2008.
The financial institution has always prided itself on the integrity of its master data and data management techniques, and claims it has had fewer problems meeting regulatory compliance like Basel II and Sarbanes-Oxley than other companies. It says it uses one customer number across the businesses, and good data management has been going on for the last 10 years.
Combating fraud and business continuity are still high on the agenda. HSBC will introduce a two-factor authentication technology in the UK to cut internet crime for its online customers later this year. Its business continuity planning now also takes into account the risk of a bird flu pandemic. As much of its business is in Asia and the Far East, HSBC has predicted that as many as half its staff could go sick if a pandemic begins, and has made plans for staff to work at home, or via video or teleconferencing links.