Dutch bank ING has signed a £274m, seven-year document
processing contract with UK outsourcing supplier Astron. The deal
is part of the IT multisourcing drive announced by ING last
November.
The agreement, which is due to be finalised in the third
quarter, will cover the processing of banking and insurance
documents and involve up to 800 ING employees transferring to
Astron.
It is the second large outsourcing contract ING has agreed since
it set out plans to transfer about 2,200 employees to outsourcing
partners in a bid to make annual cost savings of £158m.
Rather than manage all these new business relationships itself,
the bank is understood to have taken on Accenture as its
multisourcing integrator, with a remit to manage the outsourcing
contractors as they come on board.
ING told a Gartner conference in London earlier this year that
it decided to outsource its IT to multiple suppliers after carrying
out a far-reaching evaluation of its IT infrastructure and supplier
relationships.
The banking group, which operates in the UK as ING Direct, said
a string of acquisitions and mergers had left it with a
particularly complex, diverse and expensive-to-maintain legacy
infrastructure. Multisourcing was seen as the best way to cut costs
and rationalise and consolidate its numerous systems.
Dirk Karl, who is in charge of the new strategy for ING, said
the bank decided to evaluate its sourcing options because of the
maturity of the market compared to a few years ago. He said
positive experiences of sourcing across other industries had
convinced the bank there were savings to be made, but only if a
multi-supplier approach was adopted.
“The traditional one-party approach to ousourcing cannot fully
address our needs. With only one supplier, there is no internal
benchmarking or competition. There is also a danger that
proprietary or custom solutions will not be flexible or
interoperable enough.
“Standardisation and commoditisation of core systems is, we
think, more likely to offer a long-term solution.”