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Barclays takes application development back in house

Paul Kunert

Barclays Bank is to bring IT application development back in house after deciding not to renew a £400m outsourcing agreement with Accenture.

Some 230 out of 900 technology staff who moved from the bank to Accenture when the deal was signed will move back to Barclays, Computer Weekly has learned.

The news follows a decision by the bank last month to bring the management of its desktop systems back in house.

Barclays cited "commercial reasons" for the decision not to renew the six-year contract with Accenture.

A spokeswoman at Barclays said the contract was due to expire on 30 June. "We will not be renewing this as we are bringing the resource in-house." The change followed a strategic review to ensure it had "the most efficient model that supports our business", she said.

The Accenture outsourcing deal, signed in 2004, included application development and management of Barclays' UK-based commercial and retail banking systems. It was designed to cut costs and improve the agility of the bank's IT development.

A spokeswoman at Accenture said the company had "evaluated the service delivery model against business objectives and mutually agreed to end the contract as scheduled on 30 June 2010".

Computer Weekly revealed last month that Barclays intended to bring the management of its desktop systems back in house.

The bank notified systems integrator Getronics that it would end its five-year desktop management contract six months earlier than planned and run the function internally.

Claude Roeltgen, CIO at Luxembourg bank BayernLB, said outsourcing contracts can become more expensive over time, making it cost-effective to take the work back in-house.

"Over time you have many services added to original contracts and the total bill rises so much it is better to do it in-house," he said.

Other changes at Barclays will see BT replaced by Cable & Wireless for the provision of local and wide are network services across UK branches.

Related Topics: IT outsourcing, VIEW ALL TOPICS

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